So "Joe the Plumber's" take-home pay out of his biz is over $250,000

[Lex]

and he's bitching about a nominal tax increase?

[patrice]

1. Yeah, darn! he'll have to buy a Lexis instead of a Porsche, to fucking bad!

[Ichingcarpenter]

8. If only he bought a company where he wasn't $4000 over 250?

It horrible.......... I'm tired of rich fuckers.

[Lex]

11. The "worth" of the company isn't even what's taxed.

It's so stupid.

[Eric J in MN]

2. No, he's saying that he wants to buy the business where he works...

...and the business makes $250,000 or more.

His doesn't say if that is revenue or gross.

Nor does he say what his current income is:


http://blogs.abcnews.com/politicalpunch/2008/10/spread-the-weal.html

[Lex]

4. It makes a difference. A big difference. A biz grossing $250,000 is not taxed

on its gross. There are all kinds of deductions it takes to lower it down to its net, which is taxable.

And what Mr. Joe the Plumber takes for himself as salary out the biz is another thing altogether.

I'm confused by Joe the Plumber's 'problem'.

[Eric J in MN]

10. I don't think it reflects well...

...on Joe-the-Plumber or Obama or McCain that they had so much discussion of this without clarifying between revenue and profit.

[MtUpWithWngsAsEgles]

17. Obama should have kept his response short on this

[gardenista]

31. Agreed! Everyone is missing this! Obama, McCain, the media

HOnestly, it would end the discussion right here if this point could just be clarified.

[The Magistrate]

3. Among Other Things, Ma'am, That Means The Business Must Gross In the Vicinity of $3,000,000 Yearly

To buy it, he would have to be raising something near that sum in cash or credit, or combination of both....

[Lex]

7. See, that's what I think too. But it's not being dissected that way

at all. And I don't understand why not.

[The Magistrate]

23. It Is Not, Ma'am, Because People Do Not Really Understand Business

The fact is, very few people are in business of any real sort, and so most have no ready feel for the numbers involved. The three million figure is based on an assumption of a profit in the vicinity of 8%, which is not a bad take for a small business. The fellow said the business made a quarter million a year, but he may not be distinguishing between profit and the salary of its owner. He said he worked for the business, which requires it to be large enough to employ people regularly, so it is not a case of a single craftsman, a form of business in which normal calculations of profit percentage do not apply. If he is conflating the owner's salary with profit, the yearly figure could range down to perhaps as low as a million, if there were no more than a couple of employees. But even then, the purchase sum required would be a major investment, and the increase of three cents in tax on every dollar netted above a quarter-million could hardly be a deal breaker. It is possible the man is simply considering the gross of the firm as its revenue, and the fact is that the business takes in a total of a quarter million a year, out of which it pays all expenses, and nets whatever fraction of a quarter million is left after these are met. Not unreasonable for an operation where a senior craftsman employes a junior, and perhaps a family member to do the secretarial stuff. But of course, then the actual income would be nowhere near the increased tax bracket he claims to fear.

[liam_laddie]

28. Excellent reply, Magistrate!

I was one of three part-owners of a small corporation, under $2mil/year consulting biz, in the late-70's' to mid-90's. We had up to 10-12 employees at times (full-time, not free-lancers) and the owners never took out more than about 20% of the gross (salary, profit-sharing for all employees, bonuses.) No way that Joe could finance a business, in the current loan climate, big enough to take out $250K, unless he's married to a beer heiress or is selling the family farm to a developer. And that scenario is highly unlikely in NW Ohio at present. I posted a similar response on a dKos thread; also used the $2-3million figure.

[wtmusic]

12. One hell of a plumbing business that pulls in $10K/day nt

[OPERATIONMINDCRIME]

5. To Me That Was An Obama Missed Opportunity.

I wanted him to say "I want the best for Joe and I would like nothing more than to see Joe buy his business. But I think before we start putting all our energy behind someone being able to buy a business that will earn 250000 dollars, that we first take care of all the people out there who are fighting to be able to even afford hiring a plumber to begin with."

[Ichingcarpenter]

24. chapter three! on your wonderful opinions.

Now, for your education on shopping at Walmart and SUVs.

[OPERATIONMINDCRIME]

25. Are You Feeling Ok? You've Got Some Issues.

I think that would've been an awesome answer if he had given it. You don't?

Ehhhh, let me not pretend to care what you think. I ain't lettin your childish baiting get me down. I'm too giddy!

19 days to victory! GOBAMA!!!!!!

[Ichingcarpenter]

30. Are you still defending you SUV and shopping at WAL-Mart?

We all know you did for years.....

What are you doing now to support Obama and the earth?

[wtmusic]

6. It's frustrating that Obama doesn't call McCain on these glaring

inconsistencies that happen time. and. time. again.

Maybe Joe Plumber's business is worth $250K. Does he pull that in in yearly profit? NFW. I call bullshit, and I wish Obama would do the same.

[Lex]

9. My thought exactly. For that guy to be pulling out $250,000 as salary

what must his gross for his biz be?

[wtmusic]

15. I was thinking after the debate ended that McCain would latch onto this guy

as a new symbol of his campaign, but it would be too easy to tear this flimsy premise apart.

Old Joe may fade from view quickly.

[TahitiNut]

13. It's a TWO-PERSON shop! No fucking way does Obama's proposal hurt him.

He's an ass ... obviously a brain-dead buckeye who should hire an accountant ... not only for advice but just to manage his checkbook.

[Ichingcarpenter]

20. I'm offended by that...... I worked as a carpenter and an independent contractor

in Florida after living in Hawaii and being treated so fair.

I only went back to Florida because my mother died and being with
my father and my daughter.

FUCK THAT RIGHT TO WORK STATE!

[TahitiNut]

29. It's pretty clear that Joe is no higher than the 5th percentile in financial aptitude.

If he's no better as a plumber than he is at estimating finances, he hasn't a prayer. (There've been several times in my life that I'd wished I were a plumber. THEIR WORK can't be off-shored.)

[Bozita]

14. Did I hear correctly? ... He works 12 hr/day, 7 days/week?

Joe needs a fucking union.

[Porschenut1066]

16. From what I heard Joe Plumber is buying a business for $250k

Since it is often the practice to value a business at up to 10x earnings, it might be that his business is only making net after expenses $25,000 per year in which case he is not going to be taxed more. Even if the business was valued at 5x earnings he would still only be pulling in $50k a year.

Or did I hear what he said wrongly?

In any case Obama was not talking net worth but earnings. I don't know about where you are but businesses in AZ always seem to have a tremendous amount of expenses by the end of the year and so their bottom line or "net" is always a great deal smaller than one might think.

If Joe Plumber said his business was bringing in net $250k then it is likely his business would / might be valued at about $2.5 million dollars, and at that level he would be doing OK for himself.

[Lex]

21. Exactly. This numbnut "Joe" thinks the value of his business and Obama's

$250,000 line have something to do with each other.

He's an idiot. Only if he draws out of the business in income $250,000 or more would Obama's tax plan impact him in the way he's saying.

[aquart]

Joe is a union man. He knows about paying his dues.

[JackRiddler]

18. No, it's not. He needs to talk to Joe the Accountant.

And if he is clearing 250,000 after expenses, depreciation, deductibles, etc., he needs to get a clue.

[JackRiddler]

19. No, it's not. He needs to talk to Joe the Accountant...

Who can explain to him the difference between profits and revenues.

And if he is clearing 250,000 gross after expenses, depreciation, deductibles, etc., which there's no way unless he's running a large business, then he needs to get a clue that he's doing better than 98% of everyone else, 50% of whom probably work the same hours.

[Liberalatus]

22. I've never understood their logic anyway...

If McCain wins, lets say his tax rate is about 33%, and let's say if Obama wins, it goes up to 50%. So, if McCain wins, he would bring home 66% of 250,000, or an extra $165,000. But if Obama wins, he will "only" make an extra $125,000. So, his logic is he cannot buy the business because he will ONLY make $125,000 extra than he makes now? This type of backwards, greed logic is insane.

I have people at my job tell me they don't want to work overtime, because the government will just take more taxes out. And they cannot understand that they cannot out-tax their earnings. They will STILL bring home MORE money by working more. They cannot work so much, and the taxes be so much, that they actually make LESS than not working overtime.

And don't taxes come from income anyway? For a business? Does the government tax money you don't make? Don't you only pay taxes when you sell your product or service? So, if you pay higher taxes, it is off of what you made, right? So, even if the taxes are at 50%, if you make a million dollars in sales, you still have $500,000 left. Of course it would be nice to get to keep all of it, but its not like the government is going to take the $500,000 whether you made it or not. If you only make $500,000, they will only take $250,000. I don't see the problem. Just might take you a little longer to spend money on what you want or need. Of course, I know very little about all this stuff, and probably have it all wrong.

[devilgrrl]

26. I know a plumber - a GOOD one too! He could only wish to make 250k

:crazy:

[Lex]

27. My plumber had to let some of his guys go because he couldn't afford--guess what?

The health insurance premiums for them. And he didn't want to employ them without covering that for them because they had little kids. He was hoping a bigger company might hire them and be able to afford to cover their health care insurance.

Health care insurance skyrocketing is one thing that is killing small business owners.

[gardenista]

32. Thank God someone else gets it!

Too bad Obama didn't clarify. Oh well.