Tag Archives: tax reality

Trump’s tax cuts are coming. But not much for you, unless you’re very rich.

Republicans in Congress say they plan to pass a tax bill in November. While there’s no way to know what’ll be in a final bill, you can go to the Republican starting point to get a sense of what the end is likely to look like. For most Americans–in fact, for just about everyone except the wealthiest among us–the picture isn’t very exciting.

The grandiosely-titled “Unified Framework for Fixing Our Broken Tax Code,” released in September, would cut taxes by an average of about 1.2% for 95% of the population (everyone with income of up to about $300,000), according to an analysis by the Urban-Brookings Tax Policy Center, which is the go-to source for this stuff.

But that’s just an average; not everyone would get a tax cut. For example, about one of every three taxpayers making $150,000-$300,000 would actually see their taxes increase, mostly because of the loss of itemized deductions such as state income taxes and local property taxes.

If you’re in the top 1%, the outlook is radically different. About half of the total tax cut will go to the top 1%; their bills would be cut by an average of $146,000, according to the Tax Policy Center.

And for the top one-tenth of one percent (people making more than $3.5 million): Say Hello to an average tax cut of $747,000.

The tax breaks also shrink over time for everyone except the top 1%, as The New York Times points out here .

“The Situation” is in a not-so-good tax situation

Did you know that “Jersey Shore” reality show personality Michael Sorrentino, aka “The Situation”, and his brother Marc, grossed almost $9 million in a variety of ventures over four years? Me neither, until I read the U.S. District Court indictment, reported inThe New York Times,charging the brothers with conspiracy and filing false tax returns. Michael… Continue Reading

Super-rich have super-low tax rates, in super times or bad ones

Let’s stop a moment to reflect on the tax lives of the 400 highest-earning Americans, and how they suffered in the Great Recession of 2008-2009. Oh, wait a minute—they didn’t suffer. As James B. Stewart points out in The New York Times, the fortunate 400 still averaged $202 million apiece in adjusted gross income in… Continue Reading

Now that’s a home run: McCourts back in court over billion-dollar Dodgers franchise

Nasty multi-million dollar divorces make for some great financial insights, especially when they wind up in court. Today’s lesson: How profitable it can be to own a professional sports franchise, and how the tax code’s preferential rates for capital gains benefit the super-wealthy. Frank McCourt owned the Los Angeles Dodgers. When he and his wife… Continue Reading

“Mean”states crush the poor, feds pick up the pieces

Most talk about tax fairness focuses on federal income tax rates and how much the wealthiest pay. But states collect billions in taxes also, and as Katherine S. Newman writes in the Opinionator blog section of The New York Times, state tax systems tend to be more regressive than the federal system, and most regressive… Continue Reading

Corporations say DOMA is a big tax hassle

I always say that everything’s about taxes. The current legal wrangling about gay marriage proves it once again. More than 200 companies have signed onto a brief filed with the Supreme Court saying that the Defense of Marriage Act has become an administrative hassle, forces them to discriminate against different classes of married employees, and… Continue Reading