marble columns

June 27, 2003 6:19 AM

Over 2000 wealthy tax payers paid no tax in 2000. Meanwhile, states are plunging into budget deficits. Perhaps the tax cuts are meant not to spur the economy, but to defund social programs?
posted by the fire you left me (17 comments total)

While tfylm forgot to mention that these folks only represent 0.084 percent of all tax filers with incomes of $200,000 or more, it does seem odd that among the reasons to offset taxes is "extraordinary losses from personal businesses".
posted by magullo at 6:51 AM on June 27, 2003

It was 2000, I'm going to guess "stock market" on the reason for their losses.

Does it freak anyone else out to hear that 400 individuals control more than 1% of all money made in America? (info comes from the same IRS report)
posted by mathowie at 8:09 AM on June 27, 2003

I am so tired of this left wing class warfare drivel. So there are 2000 taxpayers that avoided paying income tax in 2000? Good for them!!!
posted by Durwood at 8:43 AM on June 27, 2003

Those lucky duckies.
posted by hari at 8:43 AM on June 27, 2003

Yes, Durwood. Good for them. Bad for everyone else.
posted by ook at 9:01 AM on June 27, 2003

I have difficulty in understanding those that vehemently defend the Club, but aren't even allowed in the door.
posted by four panels at 9:08 AM on June 27, 2003

You do realize that federal income taxes have very little to do with state budget shortfalls, right? You can't blame these people for state budget problems.

Frankly, unless these people lived in an apartment (no property tax) in Vancouver WA (no state income tax) and did all their shopping in neighboring Portland OR (no sales tax), it is misleading to say they paid "no tax."
posted by ilsa at 9:08 AM on June 27, 2003

Durwood re: "I am so tired of this left wing class warfare drivel"

Me too! That's why I'm starting the "Income Concentration Project", which aims to promote the happy trend of increasing income concentration among America's wealthy. Our goal is OWC*

Members of the project feel that income concentration in the US is far from optimal, and are working to promote a level of wealth concentration charactoristic of far more enlightened countries such as Guatemala and El Salvador - countries which also acknowledge the necessity of suppressing leftist sentiments among priests, nuns, labour activists, academics and other such subversives through the unfortunate but necessary expediencies of death threats, torture, and extra-judicial executions. Harsh medicine, yes, but necessary in the fight for optimal wealth concentration (OWC).

According to the New York Times which - as a paper with known communist tendencies - probably downplays this happy trend, The very richest's share of income in the US grew even bigger in the 1990's

Our target date for optimal OWC is 2025.

*Optimal Wealth Concentration - we believe that OWC will be achieved when the top one percent of Americans control at least 90% of the nation's overall wealth. When we have achieved OWC, we feel that the enlightened wealthy will be able to implement progressive solutions to the problem represented by the poor masses. We look to Jonathan Swift's writings for inspiration.
posted by troutfishing at 9:25 AM on June 27, 2003

You do realize that federal income taxes have very little to do with state budget shortfalls, right?

Um, right.

Federal Funding in the State Budget.
posted by four panels at 9:38 AM on June 27, 2003

Ilsa, you do realize that state budget shortfalls are -- at least in part -- caused by reduced federal funding of state programs, right?

You're right, of course, that it's incorrect to say that these people paid no taxes at all. They paid no federal income taxes. So, let's see; 2000 people, income at least $200,000 each, 36% tax bracket, that's $144,000,000 that could have -- should have -- gone to support the system that made these people rich in the first place.

I'm in that bracket. I pay my taxes. These people should as well.

[on preview: four panels beat me to it]
posted by ook at 9:40 AM on June 27, 2003

Not that I necessarily believe it, but an argument can be made that the tax cuts are to force local governments to pick up the tax burden from the federal. This means that the state gets less money from the feds, and so gives less to the local, so the local raises property taxes...therefore those that get the services PAY for the services.

It can be shown that that's not a good idea, considering we still have county police in Montana, even though a county is a bazillion square miles and only a few people live in it. We're supposed to be helping each other out a bit more than that.
posted by taumeson at 9:41 AM on June 27, 2003

ook - being in that tax bracket, you ought to know that the 36% is only a MARGINAL rate. People making this kind of money don't pay 36% on every dollar they earn - which is what your $144 million number assumes.
posted by schlyer at 10:02 AM on June 27, 2003

I have difficulty in understanding those that vehemently defend the Club, but aren't even allowed in the door.

Yeah because there are a bunch of cigar-chompin' old white men sitting around who decides whether someone will break the $200k club. With a defeatist attitude like that no wonder you'll never join the "Club"
posted by gyc at 10:21 AM on June 27, 2003

That's essentially correct. Income disparity is becoming increasingly entrenched, and upward mobility is declining.
posted by George_Spiggott at 10:56 AM on June 27, 2003

it does seem odd that among the reasons to offset taxes is "extraordinary losses from personal businesses".

Why is it odd to deduct business loss? While I grant that this is a device rich with fraud potential, it's also a legitimate deduction if applied honestly. I don't find it that hard to believe that in 2000, a couple thousand people lost money overall.
posted by scarabic at 11:28 AM on June 27, 2003

One thing lots of people overlook with this sort of thing is that you can have a lot of money tied up in real estate, but lose your job and not make a penny of actual income for a year.

You're still considered "wealthy" since you've got a lot of equity, but you're not paying income tax because (surprise surprise) you're not making any.
posted by wrffr at 2:36 PM on June 27, 2003

(not that that's really relevent to the article, but still... hehe.)
posted by wrffr at 2:40 PM on June 27, 2003