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President Bush’s Tax Overhaul Panel Recommendations – A Hefty Middle Class Tax Increase By Another Name.
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President Bush’s tax overhaul panel recommended two alternatives to the tax code: one that streamlines the current income tax code, the other would replace the tax code with a consumption tax – BOTH VERSIONS HAVE BIG WINNERS AND LOSERS. The streamlined version is most likely to be proposed, and in summary includes the following: 1. CREATES 4 INCOME-TAX BRACKETS of 15%, 25%, 30% and 33% (the max is below the current 35% rate). 2. REPLACES THE MORTGAGE-INTEREST DEDUCTION WITH A TAX CREDIT OF 15% of mortgage interest paid. So instead of getting an approx. effective 15 to 35% decrease in taxes for the mortgage interest paid you will be paying roughly the difference of the credit and decrease. TO TOP IT OFF, THE CREDIT WILL BE LIMITED TO INTEREST ON MORTGAGES BETWEEN $172,000 and $312,000 – depending on the geographic region. The current limit on the mortgage interest deduction is for mortgages up to $1,000,000. So the proposal effectively eliminates at least 2/3 of mortgage interest deductions, and then chops at the remainder the higher your tax bracket. This is a HUGE hit for the middle class. 3. ELIMINATE THE MARRAGE PENALTY. 4. REDUCE THE TAX ON CAPITAL GAINS AND ELIMINATE THE TAX ON DIVIDENDS. Good for you that have investments outside your 401K & IRAs. And the list goes on… See WSJ of 10/19/05 Page A4
About this poster:
Posted by:
LHU
(male, late-30s)
(Posted 10/19/05)
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Resource Links:
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Responses (1)
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Anonymous
(11/12):
Did you ever read what Dubya's instructions to the commission were? To promote business and investment, and to be "revenue-neutral". For those who can add and subtract accurately (leaves out W.) and honestly (leaves out Rove), that comes down to: screw the wage slaves.
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