Big Ed had a radio caller today who feared a tax increase on his $265K income

[Bozita]

Said he made $265,000 last year, had 4 kids in college, and couldn't afford a 3.5% tax hike.

Caller thought the tax hike would be on the entire $265k.

Ed tried to explain to him that his tax increase would be based on his earnings ABOVE $250,000.

Caller's tax increase would be $15,000 times 0.035 equals $525.

Ten bucks a week!

Just how fucking hard is this to understand?

Sounds to me like this is a teachable moment for the Dems.

[gateley]

1. Did the guy get it?

[Bozita]

3. Arrived at my destination before the discussion was concluded.

I'm hoping someone who heard the broadcast would let us know.

[gateley]

5. Usually when "those" people call, they refuse to listen to the facts.

[LuvLoogie]

6. The guy got it, but

Ed really didn't explain it well. Ed gets too emotional sometimes. The guy was getting it at the end, and was explaining it better than Ed was. Ed was clearly irritated and could not succinctly articulate that the first $250G would be taxed at the current rate, and the increase would only be applied to the income over that amount. I mean I wonder if Ed even gets it.

[Bozita]

12. Thank you. I agree.

Ed wasn't explaining it as well as he could.

His mom was a teacher. Ed isn't.

[patrice]

2. It's being "forgotten" on purpose. Should be repeated MUCH more than it is. nt

[Hassin Bin Sober]

4. I hope Ed also pointed out tax rates are based on Adjusted Gross Income (AGI) -- AFTER deductions.

In other words, if this guy owns a home and/or pays a mortgage, or pays RE taxes, or contributes to a 401k, or ALL OF THE ABOVE he isn't affected.

[LuvLoogie]

7. Even better!

[Bozita]

8. I wish now that I had driven in the slow lane.

Some DUers must have heard the whole discussion.

[dems_rightnow]

30. AGI isn't after deductions

Tax rates are applied to TAXABLE income, which is after deductions.

[Hassin Bin Sober]

34. You are correct. I misspoke.

Even his AGI probably isn't over $250K (with 4 kids in college I believe tuition comes off agi. no? Iras? Yes?)... and surely his taxable isn't over $250k. No fucking way.

All these Joe The Plumbers who "make $250k" need to be laughed off the stage when they complain. There sure are a lot of $250k earners these days. Eh? And they are all calling in to radio shows. Gee, you wouldn't think that was the top 2%(?) or anything.

When they start to get over the $300k plus range - maybe $350k then they can start to whine about their tax increase. Even then they should be told to STFU!

[Make7]

9. I thought job creators was supposed to be smart. ( n/t )

[HiPointDem]

18. i'd expect them to know from marginal rates. seems odd that he wouldn't.

[Make7]

19. It's almost like he has no idea how much taxes...

... he's been paying all these years.

[HiPointDem]

22. yeah & in my (limited) experience, that's one thing wealthy people always know.

[lonestarnot]

10. He will cling to that $525 bucks like a tick on a dog, and lose his ass on his house when the bank

wrongfully forecloses.

[HooptieWagon]

11. How does someone that ignorant make $265K?

[LuvLoogie]

13. The President rarely explains...

the nature of his proposed tax increase. In fact I only recall him mentioning one time that the increase only effects the income above 250G--that the first 250 is taxed at the current rate. I found out about it through my own research. It is a simple thing to explain, but the President never explains it. He might be now, however.

[renate]

16. welcome to DU!

And I agree. I don't think this is emphasized NEARLY enough. In fact, I've never heard it spelled out like this at all, and I think that would be an enormous help in making the idea of a tax increase on those in the range between way-upper-middle-class and absurdly-rich more palatable to even the way-upper-middle-class.

[KSstellarcat]

14. I heard that call.

He really wasn't being a jackass. Once he was told that it was only the amount above $250,000, he commented that he wasn't aware of that. To be honest, neither was I. Of course, I make nowhere near that amount, so...

I agree that this needs to be explained better and more frequently.

[Bozita]

38. Welcome to DU, KSstellarcat!

[Iwillnevergiveup]

20. He doesn't.

Probably a right winger tool calling in with a phony story. Might be paid a pittance to disrupt.

[fasttense]

24. You would be surprised how absolutely stupid some rich people are.

They just lucked into their wealth or inherited. It doesn't take brains for either one. Just look at Romney's campaign.

[JI7]

29. and the people on that Romney video including Romney himself and their foreign policy discussion

that's why i love Lawrence o'donnells "stupid rich people" line.

[bluestate10]

39. Samuel Zell is example number 1. nt

[uncle ray]

15. so he figures people who make much less than him can afford to pay more?

talk about "entitled".

[DirtyDawg]

17. Actually...

...you're all wrong. The 'proposed' increase is 3.5 percentage points, or an approximate 10% increase on earnings above the $250k. Regardless, it's a pittance.

[Hassin Bin Sober]

35. Correction: Not earnings. Taxable. Big difference.

[ToxMarz]

21. I heard it. It was incredibly hard to listen to

On both sides. Sometimes Ed is too quick to pick a fight or become defensive. And the guy I think was generally ignorant and being honestly ignorant. I have worked as an independent contractor for almost 20 years with others that as successful as they are can't add 2 + 2. They file their taxes based on what the accountant says, and get sucked into the disinformation and think they are victims. The guy really did start to get it at the end, but I think Ed was just starting to get it at the same time.

[JohnnyRingo]

23. I should have such woes.

What's it like to take home nearly a quarter million dollars? You wouldn't hear a peep out of me about taxes if I subsisted on that kind of dough.

On the bright side, he stopped paying his share of Social Security in April of this year, but someday he'll be there at the mailbox every month for the rest of his life. Like he needs it.

[SickOfTheOnePct]

25. The cap on SS taxes should be eliminated

But regardless of that, it shouldn't matter whether he needs the SS or not - if he paid into it, he should be able to collect it, period.

[Festivito]

26. I think that's wrong. It's less. More like $70 on the next 100K$.

It's not 3% added, it's a 3% increase on the rate. So, it would be 3% of the tax not the gross.

So, if he paid 20% effective rate which is one-fifth his gross, one-fifth of that $500 would really be a $100 increase.

IIRC, it actually calculates out to $70 higher in taxes for the first 100K$ of adjusted gross income for AGI of 300K over just making 200K.

[SickOfTheOnePct]

28. No

The increase is in the marginal rate. As a result, the effective rate will increase as well, effective rates are meaningless to the IRS - taxes are calculated based on marginal rates.

[JI7]

27. if he is making that much money wouldn't he already know that ? caller could be a "joe the plumber"

type . how he lied about some business he was going to buy.

[cling2reality]

32. yes the population is dumbed down so much

that a major element of the 2004 campaign was based on the fact that Americans do not understand the difference between gross and net on business income. That is what drove the Joe the P narrative.

Now we have people at high and low income levels who do not even understand how progressive tax brackets work or how you only pay taxes on income left after deductions.

If this guy has as least 15,001 in deductions (which I am sure he does) he will pay no tax increase under Obama's plan. The repub politicians know this just like they knew the gross vs net thing with Joe the P. They just count on most people not understanding it so they keep lying.

The Dems have to get out of John Kerry mode and get basic. They need to go old school with some simple charts showing how the tax brackets work. Stop assuming people understand it. They do not. (I recommend they contact Ben Netanyahu's graphics department. Putting the message aside, he used a simplistic illustration and magic marker in a speech to the heads of nations from around the globe. That is some explaining !!)

[madrchsod]

31. well some people who make this kind of money.....

have less at the end of the week than a middle class family.

[alcibiades_mystery]

37. If you're pulling down $265,000 and you have less at the end of the week

than somebody making $70,000 under normal circumstances, then you are an unmitigated dumbass.

Being stupid and profligate does not buy one out of one's social obligations.

[Doctor_J]

33. You think this could be explained to any Repuke?

they're willfully ignorant.

[sadbear]

36. Dumbass needs to talk to his accountant

because he obviously doesn't do his own taxes.