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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: KLP who wrote (138915)	7/6/2004 7:36:03 AM
From: Maurice Winn	Read Replies (1) \| Respond to of 281500

Wow, I'd have guessed a LOT more than 50% of taxpayers are paying Federal income tax. But a lot of them must own shares in companies which are paying tax, which means they are paying tax as the company itself is just an abstract representation of the owner's property and companies pay a LOT of tax. Some of that ownership will be in pension plans, trusts or something, but it's still those people paying the tax, with their surrogate legal entities doing the actual transfer of money to the US government. Mqurice

To: KLP who wrote (138915)	7/6/2004 9:08:06 AM
From: jttmab	Read Replies (3) \| Respond to of 281500

What do you think the average American is paying, Mq? The bottom 50% of the taxpayers for Federal Income Tax payments are currently paying $00.00, nada, zip, zero. I don't know what Mq means by average, but you are talking about the median. For Tax year 2002, the median income [AGI] was $28,654. A taxpayer starts paying taxes with a taxable income of $5. [see your 1040] 63% of taxpayers use the standard deduction and I would think it's more than reasonable to claim that the vast majority of persons at or below the median are using the standard deduction. To claim that the bottom 50% of taxpayers are paying $0.00 in taxes, that means that the personal and dependent exemptions have to exceed all but $5 of AGI. The earned income tax credit drops out at $2,600 AGI and accounts for 21.7 million returns....that's worth a pause ... nearly 22 million taxpayers [plus dependents] have an AGI of less than $2,600 per year.... ~22% of taxpayers have an income of less than $2,600/year. [I've seen many a conservative claim that there is no poverty in the US.]...how far would you get with an income of $2,600 per year? Hence, I don't believe your claim. I think the US Government begins to think someone is rich when the family of 4 income is about $70,000-75,000. The US goverment works in percentiles for their statistics. "Wealthy" is not a category. For TY 2002, the top 1% has a break point at $285,424. The top 10% has a break point at $92,663. The bottom 10% has a break point at $5,392. I would imagine that the bottom 10% views the top 10% as "wealthy" and I would guess that no one who makes $100,000 AGI views themselves as wealthy. For discussion purposes, I would arbitrarily set "wealthy" as the top 1%. jttmab