Home > Uncategorized > AMERICAblog – New tax law will hurt 51 million Americans

AMERICAblog – New tax law will hurt 51 million Americans

From AMERICAblog:

New tax law will hurt 51 million Americans

by Chris in Paris on 12/19/2010 12:09:00 AM

Unless the working poor want to step up their campaign contributions they’re going to have to move aside. This is the new Democratic Party that has different priorities than in the past.

Why is the payroll-tax cut not as beneficial to those workers? Because at lower income levels, a 2-percent decline doesn’t add up to much.The Tax Policy Center, a non-profit, non-partisan research organization, estimates that 51 million households, including many making $40,000 or less, would do worse under the new law. (On the Tax Policy Center’s table illustrating that point, see the fourth column from the right, in the row labeled “All,” for the total number of households benefiting more from Making Work Pay than from the Social Security payroll tax cut; the number is in thousands, so add three zeros to it.)

With the Making Work Pay tax credit, individuals between $6,452 and $75,000, have been eligible for up to $400 a year. Couples making between $12,903 and $150,000 have recieved up to $800. But, as Roberton Williams, a senior fellow with the Tax Policy Center, points out, the 2-percent drop in the payroll tax doesn’t yield $400 until a worker makes $20,000. So workers making less won’t get as much under the new system.

To confirm the TPC’s assertions, I checked with both Barbara Weltman, a tax attorney and author of J.K. Lasser’s 1001 Deductions and Tax Breaks, and John W. Roth, a senior tax analyst with CCH Wolters Kluwer, publisher of tax information and software. Both agreed with the TPC’s assertion. “The net will be a negative for the lower working class,” Roth said.

Advertisements
  1. No comments yet.
  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: