Thread: 9-9-9 Tax Plan - Impacts

Originally Posted by Bquat

Will the future TSP retirement lump sums be 9% taxed and the monthly withdrawls? Would be easier to figure your W4's not worring about a higher bracket.

Good point. I always hoped they would some day tax IRA withdrawals as capital gains (15%) instead of ordinary income - at least the earnings portion, but this (9%) would be even better.

My simple mind figures it will just about double my taxes paid. Please correct me if I'm wrong...

Front page of the 1040 is for your income with a few "adjustments" toward the bottom to arrive at your "adjusted gross income" (AGI). On the second page is a line called "tax" The tax is figured on your "taxable income" after deductions and exemptions. My tax usually ends up being about 9 to 10% of my adjusted gross income before deductions and exemptions. That offsets one of the 9's...and I'm supposed to pay another 9% sales tax?

Again...please tell me I'm mistaken.

When I figure it, my total tax goes from 15% of AGI, to 9%. Of course then I'd pay 9% sales tax on purchases. Seems like my total would be reduced but I'm not 100% sure.

Originally Posted by Birchtree

If you are still living here you should pay a tax for that privilege especially if your only contribution to society is to have illegitimate children.

It's about time everyone pays some sort of their fair share to compensate for the rich overpaying theirs

Originally Posted by KevinD

My simple mind figures it will just about double my taxes paid. Please correct me if I'm wrong...

Front page of the 1040 is for your income with a few "adjustments" toward the bottom to arrive at your "adjusted gross income" (AGI). On the second page is a line called "tax" The tax is figured on your "taxable income" after deductions and exemptions. My tax usually ends up being about 9 to 10% of my adjusted gross income before deductions and exemptions. That offsets one of the 9's...and I'm supposed to pay another 9% sales tax?

Again...please tell me I'm mistaken.

Kev, more than likely you are NOT mistaken. I read another analysis the other day, forget where, most of us middle-class types would end up paying higher taxes. the logic trail in that analysis connected dots for me. will see if can relocate that article I read.

Originally Posted by KevinD

My simple mind figures it will just about double my taxes paid. Please correct me if I'm wrong...

Front page of the 1040 is for your income with a few "adjustments" toward the bottom to arrive at your "adjusted gross income" (AGI). On the second page is a line called "tax" The tax is figured on your "taxable income" after deductions and exemptions. My tax usually ends up being about 9 to 10% of my adjusted gross income before deductions and exemptions. That offsets one of the 9's...and I'm supposed to pay another 9% sales tax?

Again...please tell me I'm mistaken.

I think you might be right in some respects to your sistuation....But I really think there will be some major adjustments to the 1040's...

But what I think would really make all this work, would be to stop the April 15th filings all together for non business or in other words, personal/family filings would be abolished

I think tax returns should be filed on election day!

Originally Posted by tsptalk

When I figure it, my total tax goes from 15% of AGI, to 9%. Of course then I'd pay 9% sales tax on purchases. Seems like my total would be reduced but I'm not 100% sure.

The Problem with a flat tax is that it is a consumer tax. When market fluctuates and consumerism falls, it automatically costs the government. Less jobs, less earners, less taxes, less government revenue. Also, when the government needs to operate above it's revenue stream I agree it will cause the government to increase the levels and thus, taxation above the promise. Progressive tax works but distribution of the levels needs to address progressively, and not layered like a cake. But that means that it has to be lowered to reach the levels of those who are currently not paying...And hence, not fair. And no, do not pay taxes on election day...Then it's too late.....Taxes should be an honor to pay, not a burden......

My understanding of a flat tax is that there are no deductions. So if you earn $100,000.00 you will pay $9,000.00.

Originally Posted by Buster

I think you might be right in some respects to your sistuation....But I really think there will be some major adjustments to the 1040's...

But what I think would really make all this work, would be to stop the April 15th filings all together for non business or in other words, personal/family filings would be abolished

With a flat tax why would you have to file. Matter of fact the goverment can automatically take out your tax and there would be no delenquent tax payers. I don't know why they don't automatically take tax out of your pay and have you file for your deductions in a return. Then everyone would file to get their part back. Don't know about the ones who work for cash and don't claim income, like maids, car washers, auto detail and lawn and garden businesses and so on.

A national sales tax is an awful idea. It is a brand new tax to raise along with income tax. Why not get by the way we did for the first 150 years. No sales tax, no income tax. Tax booze.