2011 "Changes" - Wave #1

So much for “Change” and “no tax increases” Change is all we will have left in our pockets – no folding money.

This came from the Senior Tax Editor for Kiplinger Letters

In just three months, on January 1, 2011, the largest tax hikes in the history of America will take effect.

They will hit families and small businesses in three great waves.

On January 1, 2011, here’s what happens... (read it to the end, so you see all three waves)...

First Wave:

Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families.

These will all expire on January 1, 2011.



Personal income tax rates will rise.

The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed).

The lowest rate will rise from 10 to 15 percent.

All the rates in between will also rise.



Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates.

The full list of marginal rate hikes is below:

• The 10% bracket rises to an expanded 15%

• The 25% bracket rises to 28%

• The 28% bracket rises to 31%

• The 33% bracket rises to 36%

• The 35% bracket rises to 39.6%


Higher taxes on marriage and family.

The "marriage penalty" (narrower tax brackets for married couples) will return from the first dollar of income.

The child tax credit will be cut in half from $1000 to $500 per child.

The standard deduction will no longer be doubled for married couples relative to the single level.

The dependent care and adoption tax credits will be cut.



The return of the Death Tax.

This year only, there is no death tax. (It’s a quirk!) For those dying on or after January 1 , 2011 , there is a 55 percent

top death tax rate on estates over $1 million. A person leaving behind two homes, a business, a retirement account , could easily pass along a death tax bill to their loved ones. Think of the farmers who don’t make much money, but their land, which they purchased years ago with after-tax dollars, is now worth a lot of money. Their children will have to sell the farm, which may be their livelihood, just to pay the estate tax if they don’t have the cash sitting around to pay the tax. Think about your own family’s assets. Maybe your family owns real estate, or a business that doesn’t make much money, but the building and equipment are worth $1 million. Upon their death, you can inherit the $1 million business tax free, but if they own a home, stock, cash worth $500K on top of the $1 million business, then you will owe the government $275,000 cash! That’s 55% of the value of the assets over $1 million! Do you have that kind of cash sitting around waiting to pay the estate tax?

Higher tax rates on savers and investors.

The capital gains tax will rise from 15 percent this year to 20 percent in 2011.

The dividends tax will rise from 15 percent this year to 39.6 percent in 2011.

These rates will rise another 3.8 percent in 2013.

[QUOTE=Chubminnow;431092]So much for “Change” and “no tax increases” Change is all we will have left in our pockets – no folding money.[/QUOTE]

When I saw this line it reminded me of a saying we had back in England in the '80s:

"America has Ronald Reagan, Johnny Cash and Bob Hope. We have Maggie Thatcher, no cash and a lot less bloody hope!" ;)

DAVE

[QUOTE=ThreeLions;431216]When I saw this line it reminded me of a saying we had back in England in the '80s:

"America has Ronald Reagan, Johnny Cash and Bob Hope. We have Maggie Thatcher, no cash and a lot less bloody hope!" ;)

DAVE[/QUOTE]

Hey is that a warning of things to come??:)

I know my medical insurance will be used as income,and my meager pension is taxed by Ky, sure I'm pissed off. But what really frosts my buns is the dodges that huge corporations use to escape paying income tax. Micro soft, no taxes, CISCO, no taxes, google ma maybe 2.4% or less on a billion.And the senate stalled a bill that would have at least looked at these tax dodges.A lot is said about the welfare system, but not the corporate welfare system WHY?

The new idea of of no tax, no oversite and no investment is going to be the decline of the good old USA.

99% of the ones crying for no tax and no investment are those that are established. They are looking backwards, have the mindset "I got mine".

However, we just keep falling further behind in our (the USA) ability to compete in the world.

Most of the technological advances in the 21st century were a direct result of US government investment after WWII. The idea that corprate america is going to lead the world in inovation is misleading at best. Research and developent continues to be only a minute fraction of corperate budgets.

Semiconductors, internet, solar panels, GPS, Nicad batteries all the result of government comitment to invest.

We are in the 22nd century now.

Germany has some of the highest wages for workers, highest union represntaion and lowest unemployment rate.

This election we elect a senator for 6 years. Do we move 6 years forward, or 6 years back?

I am concerned this Tea Party mentality will move us backwards and further behind in the world. The false belief that somehow corperate america will rescue us is just crazy. Even Haliburton out last Vice Presidents former employer has moved their headquarters to Saudia Arabia.

Better think before you pull a lever.

There are a few distorted facts in that particular chain letter and one or two outright lies. For one, nobody's "medical insurance will be used as income." The amount employers pay towards employees' premiums will be included on W-2's, but until 2018 that's for informational purposes only. 2018 is when the portion of ObamaCare about "Cadillac plans" takes effect, basically a tax on the money employers pay towards premiums over a certain threshold. That threshold is currently set to be $27,500 to start with. I don't know about you, but that's WAY more than my employer pays towards mine, and I have pretty good insurance. I don't think that particular change is going to affect me or the rest of the middle class. But good or bad, it's not changing anything until 2018. Personally, the biggest change coming for me in 2011 is that I won't be able to pay for over the counter medicine with my HSA. I liked being able to do that, but it's not a big deal. Now when it comes to the Estate Tax (the so-called "Death Tax"), this chain letter just has it flat out WRONG. IF it's brought back (which is not a certainty), it will only be for estates worth more than $3.5 million for individuals, or $7 million for couples. The rest of those increases listed will only occur if Congress fails to extend ANY of Bush's tax cuts. Most likely they're going to extend at least some, possibly all of them.

Internet chain letters generally are not a good source of facts.

With the amount of out of state money being poured into these elections in Kentucky it is no wonder why there are so many people with a real misconception of the facts.

Corp. financing of our elections is so out of control we should assign names to the election just as we now do with out University Stadiums. Papa Johns stadium in Louisville, The Halliburton senate race of 2010.

This senate seat will be filled till 2017. When you vote for someone that will not commit to protecting basic cival liberties we are in real trouble. To trade fundemental cival rights for a preceived pitance of a tax break would just be selling out Kentucky.

RP will probably win KY. Palin may well win in 2012. And we will find ourselves with the next big banking crisis, terroist attack, securities fraud. Halliburton will be doing well in Saudia Arabia and Big Oil will continue to stiffle any inovation in energy independance.

So we will just put off rebuilding America till 2017.

[QUOTE=kydonky;431263]With the amount of out of state money being poured into these elections in Kentucky it is no wonder why there are so many people with a real misconception of the facts.

Corp. financing of our elections is so out of control we should assign names to the election just as we now do with out University Stadiums. Papa Johns stadium in Louisville, The Halliburton senate race of 2010.

This senate seat will be filled till 2017. When you vote for someone that will not commit to protecting basic cival liberties we are in real trouble. To trade fundemental cival rights for a preceived pitance of a tax break would just be selling out Kentucky.

RP will probably win KY. Palin may well win in 2012. And we will find ourselves with the next big banking crisis, terroist attack, securities fraud. Halliburton will be doing well in Saudia Arabia and Big Oil will continue to stiffle any inovation in energy independance.

So we will just put off rebuilding America till 2017.[/QUOTE]

What do you mean the next big banking crisis, terrorist attacks and securities fraud?? Because of Palin and or RP? These two hold the key to everything? I'm not following that train of thought. Sounds more like sour grapes to me.

As far as another post you made about how great Germany is right now.....I have to say really? I have no clue of how they are doing so if you have something that shows how great it is over there please post it for me.

When I lived there it was amazing at how many days off they had..... often wondered how anything got done! Their military was slack, their civilian population seemed to be off all the time for some holiday drinking their life away.

Heck, maybe your right... things over there are so well run by the gubment that everyone works and gets paid just fine. Sounds more like Unions and Gubment equals happiness in your world....I'm still happier here in the United States even with all our problems.:)

They continue to invest in infastructure, education, and inovatin.

They have not suffered the economic downfall that has plagued us. And they have not boosted economic growth on the backs of the middle class.

BTW they spend as much in education on persons already in the work force as general education. The do concentrate on technical and continuing education.

Hard to deny their reputaion for inovation and quality. Look at the sticker on a new a new Mercedes.

We can bury or heads in the sand, save $200.00 a year in taxes and spend it on Korean DVD players. That will not help our economy grow.
Deregulation of banking/securities, bending to corporations that only abandon the good ole Usa to the highest bidder will move us backwards for the next 6+ years.

G.W. was such a good President. Did not release a statement for over 4 days after 9/11 no one even knew where he was. This was based on the famous $200.00 tax rebate of the 2000 election. So we got what we paid for.

I'm not much on German made cars. Expensive p.o.s. is what I hear folks say. Lexus and other asian cars seem like a better bang for the buck. Owner of the company I work for traded his in for a ford though. Got tired of spending money on maintenance he said.
Not sure why Bush was brought up again??? Not surprised.... just thought all that was over with.
I'm in the middle of Halloween stuff so I can't search but I seem to remember Germany having a tough time as well. I'll look it up.

[QUOTE=kydonky;431252]The new idea of of no tax, no oversite and no investment is going to be the decline of the good old USA.

99% of the ones crying for no tax and no investment are those that are established. They are looking backwards, have the mindset "I got mine".

However, we just keep falling further behind in our (the USA) ability to compete in the world.

Most of the technological advances in the 21st century were a direct result of US government investment after WWII. The idea that corprate america is going to lead the world in inovation is misleading at best. Research and developent continues to be only a minute fraction of corperate budgets.

Semiconductors, internet, solar panels, GPS, Nicad batteries all the result of government comitment to invest.

We are in the 22nd century now.

Germany has some of the highest wages for workers, highest union represntaion and lowest unemployment rate.

This election we elect a senator for 6 years. Do we move 6 years forward, or 6 years back?

I am concerned this Tea Party mentality will move us backwards and further behind in the world. The false belief that somehow corperate america will rescue us is just crazy. Even Haliburton out last Vice Presidents former employer has moved their headquarters to Saudia Arabia.

Better think before you pull a lever.[/QUOTE]

The U.S. government does not create jobs. Corporate America and small business create jobs. Semi conductors , the internet, solar panels, GPS, Nicad batteries were all developed by private companies. Germany's unemploment rat has been hovering about 8 to 9 percent. Wages are set by the government. We don't need any more social programs. They are gonna break us like they are breaking Germany. Like you said, Think before you pull the lever!