From: Mike Lorrey (mlorrey@datamann.com)
Date: Mon Jul 08 2002 - 13:50:56 MDT
Randy wrote:
>
> On Sun, 7 Jul 2002 23:30:31 EDT, you wrote:
>
> >Someone said:
> >"Well, my biggest gripe with taxes is that those "teeny slices" add up to
> >over 60% of my income!"
> >
> > Let me offer an example from the other end of the spectrum. I am
> >studying accounting and this semester I am doing a course in payroll
> >accounting. The problems we work on are fictious in that the names are made
> >up. But they are "live ammunition" in that the conditions are entirely
> >typical of what we will see in practice.
> > Last week we did a paycheck for a woman with two children that made
> >about $15,000 per year. She is making so little that the law says she gets
> >an income credit against her taxes.
> > My point is this: after paying state taxes, local taxes, FICA, health
> >tax, etc. she was still paying more than such a person could afford. But
> >what was worse was realizing that the small break she got on her income taxes
> >was strictly window dressing for political purposes. Work it out for
> >yourself and take a look.
> > Now, someone will question whether I am advocating "soak the rich" to
> >the advantage of the poor.
>
> So what would be so wrong with that?
The only problem is that the above example is entirely fictitious (if
the woman is a US resident or citizen) If she has two kids and earns
$15k per year, she will pay about $1500 in witholding, unemployment, SS,
etc over the course of the year, but at tax time will get about $3k-4k
from the government, thanks to the EITC.
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