TakeYouToTasker Posted July 2, 2012 Share Posted July 2, 2012 While the passage of this bill will obviously put a huge strain on our already failing economy as these new taxes are slowly implemented, there exists a death blow which no one has really talked about much as of yet. If the Bush tax cuts are not extended, the tax on dividends for those earning above $250,000/yr. will be be raised from 15% to a staggering 43.8%. I'm sure the some of the more left leaning liberals, and those who don't understand how investment growth is reported on your taxes will be dancing in the streets chanting varied versions of, "Eat the rich!" However, after coming to understand the real economic implications of this hike in the most volatile economic environment our country has ever seen, the facts should give even the Reddest Hammer-and-Sickleite pause. Actual growth of Capital and dividends are not necessarily linked when reporting real gains and losses. Investment that yield high dividends for the purposes of income do not always reflect growth of the actual investment. And investment that loses 10% in a given year can, and often does, report a 5% dividend. So what this serves to accomplish is nearly a 50% tax on money that was lost. Investment carries risk, and most investment outside of 401K's, 403b's, 457's and other employee sponsored qualified accounts is made by those with higher earnings, because the are the ones who can afford to carry that risk of loss. That risk is calculated and mitigated, however, by the potential upside of gains, and that upside has been greatly diminished by this legislation. "So what?" you may ask. Well, what we are about to witness, if these tax cuts are not extended, is one of the greatest capital flight driven selling frenzies the market has ever seen, leading to massive job loss as businesses struggle to recapitalize, and the sinking of the entire retirement account system of the United States. The bold in the below article is mine: http://www.businessinsider.com/here-are-the-new-obamacare-taxes-2012-7" Here Are The New Taxes You're Going To Pay To Pay For Obamacare...Henry Blodget Obamacare is now official, which means that a lot more people in the United States will have health insurance. And it also means a lot more people will be paying more taxes. (You didn't think Obamacare was free, did you?) Here are some of the new taxes you're going to have to pay to pay for Obamacare: A 3.8% surtax on "investment income" when your adjusted gross income is more than $200,000 ($250,000 for joint-filers). What is "investment income?" Dividends, interest, rent, capital gains, annuities, house sales, partnerships, etc. Taxes on dividends will rise from 15% to 18.8%--if Congress extends the Bush tax cuts. If Congress does not extend the Bush tax cuts, taxes on dividends will rise from 15% to a shocking 43.8%. (WSJ) A 0.9% surtax on Medicare taxes for those making $200,000 or more ($250,000 joint). You already pay Medicare tax of 1.45%, and your employer pays another 1.45% for you (unless you're self-employed, in which case you pay the whole 2.9% yourself). Next year, your Medicare bill will be 2.35%. (WSJ) Flexible Spending Account contributions will be capped at $2,500. Currently, there is no tax-related limit on how much you can set aside pre-tax to pay for medical expenses. Next year, there will be. If you have been socking away, say, $10,000 in your FSA to pay medical bills, you'll have to cut that to $2,500. (ATR.org) The itemized-deduction hurdle for medical expenses is going up to $10,000. Right now, any medical expenses over $7,500 per year are deductible. Next year, that hurdle will be $10,000. (ATR.org) The penalty on non-medical withdrawals from Healthcare Savings Accounts is now 20% instead of 10%. That's twice the penalty that applies to annuities, IRAs, and other tax-free vehicles. (ATR.org) A tax of 10% on indoor tanning services. This has been in place for two years, since the summer of 2010. (ATR.org) A 40% tax on "Cadillac Health Care Plans" starting in 2018.Those whose employers pay for all or most of comprehensive healthcare plans (costing $10,200 for an individual or $27,500 for families) will have to pay a 40% tax on the amount their employer pays. The 2018 start date is said to have been a gift to unions, which often have comprehensive plans. (ATR.org) A"Medicine Cabinet Tax" that eliminates the ability to pay for over-the-counter medicines from a pre-tax Flexible Spending Account. This started in January 2011. (ATR.org) A "penalty" tax for those who don't buy health insurance. This will phase in from 2014-2016. It will range from $695 per person to about $4,700 per person, depending on your income. (More details here.) A tax on medical devices costing more than $100. Starting in 2013, medical device manufacturers will have to pay a 2.3% excise tax on medical equipment. This is expected to raise the cost of medical procedures. (Breitbart.com) So those are some of the new taxes you'll be paying that will help pay for Obamacare. Any big ones I've missed? Note that these taxes are both "progressive" (aimed at rich people) and "regressive" (aimed at the middle class and poor people). The big ones--the 3.8% investment income hike and the Medicare tax increase--only hit you if you're making more than $200,000 a year. The rest hit you no matter how much you're making. Link to comment Share on other sites More sharing options...
B-Large Posted July 2, 2012 Share Posted July 2, 2012 Has anyone considered, for just a moment, that the ACA may create more jobs that is supopsedly will cause to be lost? 30-40 millions people now buying insurance, is is not possible we will be expansion of healthcare facilites, LTC companies, home health agencies, insurance compaines to keep up with this huge increase in demand and access? Healthcare is one of the few sectors that is steady and growing, has been and continues to be for the last decade, plus. Addtionally, the wages we pay here are relatively high, secretaries making 30+, middle management making 100K or so... Have we also considered how many hungry enterprising folks may be willing to quit that job they have kep because of insurance and finally start that business they were afraid to? Link to comment Share on other sites More sharing options...
Chef Jim Posted July 2, 2012 Share Posted July 2, 2012 Has anyone considered, for just a moment, that the ACA may create more jobs that is supopsedly will cause to be lost? 30-40 millions people now buying insurance, is is not possible we will be expansion of healthcare facilites, LTC companies, home health agencies, insurance compaines to keep up with this huge increase in demand and access? Healthcare is one of the few sectors that is steady and growing, has been and continues to be for the last decade, plus. Addtionally, the wages we pay here are relatively high, secretaries making 30+, middle management making 100K or so... Have we also considered how many hungry enterprising folks may be willing to quit that job they have kep because of insurance and finally start that business they were afraid to? So you counter a thread on real taxes with potential job growth. Why not give us your opinion of raising taxes on dividends nearly 300% to a whopping 43.8%? And that doesn't even include state taxes. It's !@#$ing crazy. So much for the allure of dividend paying stocks. Link to comment Share on other sites More sharing options...
Buftex Posted July 2, 2012 Share Posted July 2, 2012 (edited) From a political debate pov, this should turn into one hell of an argument. Romney is in a very odd position...he agrees with the president, apparently, that the penalty for not having insurance is, in fact, a penalty, not a tax! MSNBC has been running lots of clips of Romney defending his plan against the same attacks that Republicans are making on the plan the last few days...to a word, Romney takes Obamas' stance on all of them...and, he can't make the argument that he was only talking about a state by state mandate...in at least two clips he refers to "insuring up to 45 million Americans that are not currently insured"... it will take a Houdini for him to get out of this. http://www.bostonherald.com/business/healthcare/view/20120702romney_agrees_with_obama_health_care_mandate_not_a_tax/srvc=business&position=recent_bullet Edited July 2, 2012 by Buftex Link to comment Share on other sites More sharing options...
CosmicBills Posted July 2, 2012 Share Posted July 2, 2012 (edited) From a political debate pov, this should turn into one hell of an argument. Romney is in a very odd position...he agrees with the president, apparently, that the penalty for not having insurance is, in fact, a penalty, not a tax! MSNBC has been running lots of clips of Romney defending his plan against the same attacks that Republicans are making on the plan the last few days...to a word, Romney takes Obamas' stance on all of them...and, he can't make the argument that he was only talking about a state by state mandate...in at least two clips he refers to "insuring up to 45 million Americans that are not currently insured"... it will take a Houdini for him to get out of this. http://www.bostonherald.com/business/healthcare/view/20120702romney_agrees_with_obama_health_care_mandate_not_a_tax/srvc=business&position=recent_bullet Santorum called it. Maybe the only thing during the whole race he was correct about. "There is one candidate who is uniquely disqualified (re: Healthcare). That's why I'm here and he's not," Santorum said about Romney. "He is the worst candidate to go up against Barack Obama." Edited July 2, 2012 by tgreg99 Link to comment Share on other sites More sharing options...
IDBillzFan Posted July 2, 2012 Share Posted July 2, 2012 it will take a Houdini for him to get out of this. If by Houdini you mean the next few jobs reports, then yes, you're correct. Health care won't doom Romney because the economy will doom Obama first. But cheer up! Maybe on Friday unemployment will drop to 8.1% on news that another 69,000 jobs were created last month. Yee-haw! Summer of Recovery 4.0 is right around the corner. Link to comment Share on other sites More sharing options...
CosmicBills Posted July 2, 2012 Share Posted July 2, 2012 If by Houdini you mean the next few jobs reports, then yes, you're correct. Health care won't doom Romney because the economy will doom Obama first. But cheer up! Maybe on Friday unemployment will drop to 8.1% on news that another 69,000 jobs were created last month. Yee-haw! Summer of Recovery 4.0 is right around the corner. ...But it sure doesn't help that the GOP candidate will be unable to debate Obama's core, and most politically explosive, piece of legislation. Link to comment Share on other sites More sharing options...
B-Large Posted July 2, 2012 Share Posted July 2, 2012 So you counter a thread on real taxes with potential job growth. Why not give us your opinion of raising taxes on dividends nearly 300% to a whopping 43.8%? And that doesn't even include state taxes. It's !@#$ing crazy. So much for the allure of dividend paying stocks. alot of my income comes from rents collected, I can't imagine I would be thrilled about paying more taxes.... but I am sure there will be negotiated loopholes built in somwhere my accountant will find that will be just up my alley.... Link to comment Share on other sites More sharing options...
IDBillzFan Posted July 2, 2012 Share Posted July 2, 2012 (edited) ...But it sure doesn't help that the GOP candidate will be unable to debate Obama's core, and most politically explosive, piece of legislation. He doesn't need to debate it. He only needs to stay on message: the economy sucks and Obama is making things worse.Over and over and over. And THAT is something Obama can't debate because, let's be honest, "It could've been worse" is not a very good sales pitch. Edited July 2, 2012 by LABillzFan Link to comment Share on other sites More sharing options...
CosmicBills Posted July 2, 2012 Share Posted July 2, 2012 He doesn't need to debate it. He only needs to stay on message: the economy sucks and Obama is making things worse.Over and over and over. And THAT is something Obama can't debate because, let's be honest, "It could've been worse" is not a very good sales pitch. You're not wrong about the economy. But are you really thinking that the issue won't come up in the debates? Especially with Romney claiming his first act will be to repeal his own (bastardized version) Health Care bill? He set himself up to take a big hit on that point over the next few months. It might not be enough to cripple his campaign, but it doesn't help. Link to comment Share on other sites More sharing options...
TakeYouToTasker Posted July 2, 2012 Author Share Posted July 2, 2012 Has anyone considered, for just a moment, that the ACA may create more jobs that is supopsedly will cause to be lost? Not anyone who examines real economies and human motivation. As an aside, jobs lost is incredibly difficult to quantify, and an ugly business politically, so you'll never see it attempted. 30-40 millions people now buying insurance, is is not possible we will be expansion of healthcare facilites, LTC companies, home health agencies, insurance compaines to keep up with this huge increase in demand and access? No. It is not possible. It will mean greater profits for insurers and big pharma, and the LTC marketplace has already begun drying up due to the rapidly rising costs of elder care. Home health agencies only service those who are of means, a market the ACA will diminish. As to demand and access: what happens to prices and availability when demand rises but supply decreases or stays the same? Healthcare is one of the few sectors that is steady and growing, has been and continues to be for the last decade, plus. Addtionally, the wages we pay here are relatively high, secretaries making 30+, middle management making 100K or so... Are you familiar with the business cycle? Have we also considered how many hungry enterprising folks may be willing to quit that job they have kep because of insurance and finally start that business they were afraid to? You believe that in times of economic uncertainty and bad lending and business climates there are people lining up to quit a steady pay-check and risk their own capital? Link to comment Share on other sites More sharing options...
Chef Jim Posted July 2, 2012 Share Posted July 2, 2012 alot of my income comes from rents collected, I can't imagine I would be thrilled about paying more taxes.... but I am sure there will be negotiated loopholes built in somwhere my accountant will find that will be just up my alley.... Guess what my friend taxes on all investment income is going up too. Now this depends on your income but if it's high ($200k/$250k - single/married) you'll be paying a 3.8% investment tax on your rentals thanks to ACA. There are a ton of new taxes on the horizon to fund ACA. It ain't gonna be pretty. Link to comment Share on other sites More sharing options...
Doc Posted July 2, 2012 Share Posted July 2, 2012 You're not wrong about the economy. But are you really thinking that the issue won't come up in the debates? Especially with Romney claiming his first act will be to repeal his own (bastardized version) Health Care bill? He set himself up to take a big hit on that point over the next few months. It might not be enough to cripple his campaign, but it doesn't help. Why would Barry bring it up in the debates? More people still hate than like it. Link to comment Share on other sites More sharing options...
Chef Jim Posted July 2, 2012 Share Posted July 2, 2012 From a political debate pov, this should turn into one hell of an argument. Romney is in a very odd position...he agrees with the president, apparently, that the penalty for not having insurance is, in fact, a penalty, not a tax! MSNBC has been running lots of clips of Romney defending his plan against the same attacks that Republicans are making on the plan the last few days...to a word, Romney takes Obamas' stance on all of them...and, he can't make the argument that he was only talking about a state by state mandate...in at least two clips he refers to "insuring up to 45 million Americans that are not currently insured"... it will take a Houdini for him to get out of this. http://www.bostonher...n=recent_bullet The OP is not talking about the tax/penalty question. He's talking about actual increase in income taxes due to ACA. Link to comment Share on other sites More sharing options...
CosmicBills Posted July 2, 2012 Share Posted July 2, 2012 Why would Barry bring it up in the debates? More people still hate than like it. For exactly that reason... It paints Romney into a corner he's trying desperately to distance himself from. It's politics 101. Call out any and all hypocritical statements made by your opponent to attempt to paint them as something other than what they are. Not saying it'll work. But imagine if the GOP had a candidate without that kind of baggage. Then they could launch a full scale attack on the ACA and Obama without looking like a fool. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted July 2, 2012 Share Posted July 2, 2012 Bush good! Taxes bad! Link to comment Share on other sites More sharing options...
Chef Jim Posted July 2, 2012 Share Posted July 2, 2012 Bush good! Taxes bad! So you're cool with a nearly 300% tax increase on dividends? Would you be happy to lose half of your income to taxes? Do you think that the lowest tax bracket should have their taxes reduced by 30% BTW these are all yes/no questions. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted July 3, 2012 Share Posted July 3, 2012 Yes. Yes. As mine as we are all out for ourselves (healtcare, etc..)... !@#$ 'em all... Except Bain Capital of course! Link to comment Share on other sites More sharing options...
WorldTraveller Posted July 3, 2012 Share Posted July 3, 2012 (edited) Has anyone considered, for just a moment, that the ACA may create more jobs that is supopsedly will cause to be lost? 30-40 millions people now buying insurance, is is not possible we will be expansion of healthcare facilites, LTC companies, home health agencies, insurance compaines to keep up with this huge increase in demand and access? Healthcare is one of the few sectors that is steady and growing, has been and continues to be for the last decade, plus. Addtionally, the wages we pay here are relatively high, secretaries making 30+, middle management making 100K or so... Have we also considered how many hungry enterprising folks may be willing to quit that job they have kep because of insurance and finally start that business they were afraid to? It flies in the face of reason to believe that a bill that creates mandates for people to buy a product that otherwise never would have and throw in huge taxes on top of that and regulations that are harmful to small businesses by mandating coverage for their employees would be a net job creator. When you take money out of the economy and add burdensome regulations that inhibit growth, it doesn't create a landscape for more job creation. It's ok that you like this bill, that is your opinion, but let's not let your enthusiasm carry you away to such a high level of naïveté. Edited July 3, 2012 by WorldTraveller Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted July 3, 2012 Share Posted July 3, 2012 How long before Chef Jim falls hook line and sinker for his own trap he set? Link to comment Share on other sites More sharing options...
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