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Politics : John McCain for President -- Ignore unavailable to you. Want to Upgrade?

To: chalu2 who wrote (479)	2/21/2000 7:09:00 PM
From: Peter O'Brien	Read Replies (1) \| Respond to of 6579

chalu2, I appreciate the tone of your reply much more than the other poster, but my mathematics are not crooked... You say: "the marginal tax rate does not change with the allowance or disallowance of tax credits". This is simply not true... The phase-out of tax credits (like the child credit I cited) may dramatically impact a family's marginal rate. You say: "to say that the $7100 comes completely out of the $10000 sliver between $100K and $110K is silly..." No, it is not silly... This is precisely the definition of what a marginal tax rate is, i.e., how many cents are paid in taxes on an incremental dollar that is earned. Sure, the McCain website doesn't come right out and say "71% marginal tax rate", but that is indeed the effect!! By earning only an additional 10K, this family's final tax bill increases by huge $7,100. Case closed. Unfortunately, our tax code is littered with such hidden phase-outs. Not only is there the child care credit, but personal exemptions and itemized deductions also phase out at income levels > 100K. This is a very sneaky and unfair way to raise marginal rates on "those evil rich people" making > 100K. McCain is apparently unconcerned about this: see his own words, on his own web site! In fact, in the case of the child credit, McCain has compounded the problem by increasing the dollar amount of the credit without any corresponding increase in the phase-out range.