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Originally Posted by KMA-628
Correct.
In the case above, without the child tax credit, the final tax burden would be next to nothing (or nothing) with all/most of the income taxes paid being returned.
It does go to show, that if the income went down below $35K, then the EIC would apply and you would then get back more than was paid--and the EIC is not part of Bush's tax cuts.
So, as income goes down, the tax burden goes down, and the person/family has a very good chance of getting back more in a refund than was paid in income taxes.
This is why I discount argument related to "tax burdens" on people/families making roughly $35K or less.
The burden gets real hefty after $115K--I know some people that do whatever they can to keep their taxable income below $115K, because it is a big jump in tax rates if you make over $115K.
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OK, KMA, now we're getting somewhere.
First, I don't think the EIC is very much at all. As you get lower into that bracket, it begins to come out to be in the hundreds, if I remember. I've never qualified for it either, but I've always calculated it to see if I did and also to see just what the heck I was missing out on--and it wasn't ever very much.
I think that $1500 over the span of a year, while it helps out, isn't very much, for a reference marker.
Second, I don't hear too many people around me arguing that people in the <$35K are bearing the brunt of the tax burden. What we are saying, however, is that people making 35K, or less, aren't making enough to live on period. regardless of tax burden.
Now here's where it gets a bit tricky in the argument: when tax cuts go in effect, lots of money goes different places. A lot of it goes to the wealthy. Your $2K is paltry compared to hundreds of thousands and even millions in a number of cases (corporations being extremely harmful in this regard).
in order to pay for all that, we have to cut programs. or not increase their funding (so the argument can literally be made that one didn't cut a program's funds, even if the increase in funding was less than the period before--which in reality is a cut).
and the programs that get cut?
welfare, school funding, military (reservists, VA benefits, the stuff not in front of the camera), fees go up for things like parks, beaches, lakes, other recreational things, police, firefighters, hospitals, etc.
the poor get hit disproportionately when services are cut. They aren't taken care of by our political system, and it would be strange for anyone to argue that they actually ought to--according to our tenets of the powerful rightfully holding the reigns of power and morally deserving their position. According to that, no one really could expect the wealthy and politically powerful to do anything about the impoverished if they don't get up and actualize themselves. I understand that side of the argument.
But you need to understand this side of the argument, too. The tax pie is larger than the dollars that flow out of your pocket and sometimes back into your bank account. If you've looked at that larger pie and considered that the money back is worth the programs lost, all the power to anyone who makes that free choice. But, and this is critical to my mind, if I had three children, I don't think 2 or 3 thousand dollars will make up for the lack of textbooks in their classes, let alone computers. If I had a daughter or two, I'd much rather have the free clinic down the road providing sliding scale pap-smears and birth control than that 2 grand.
If one of my children falls and breaks an arm, and I'm sitting in that 35K bracket or lower, that 2K isn't going to cover my day off from work and non-insured visit to the doctor. that's just getting in the door. we have no idea what's going to happen to low-income health insurance.
The best scenario: that savings can offset the rise in state taxes.
and then when most people are talking about <35K bearing a brunt of actual taxation, they are usually referring to what would happen if we went to a flat tax. for example, comparing the fact that they don't pay anything now to the idea that they would pay 17% of their income under a new system that didn't take into consideration all these factors I am glossing over right now.