MCViewPoint

Opinion from a Libertarian ViewPoint

Hands Off My Income | The Libertarian Institute

Posted by M. C. on January 19, 2023

Instead, most of Americans’ tax money is spent on welfare, grants, subsidies, vouchers, transfer payments, unconstitutional agencies and programs, foreign aid, hundreds of foreign military bases and tens of thousands of U.S. troops all over the globe, and offensive military intervention.

Taxes are not the price we pay for a civilized society, as is engraved on the exterior of the Internal Revenue Service building in Washington, D.C. Rather, taxes are the price we pay for the welfare/warfare state.

https://libertarianinstitute.org/articles/hands-off-my-income/

hands-off-my-income/

by Laurence Vance

pexels nataliya vaitkevich 6863244

House Democrats finally obtained former president Donald Trump’s tax returns and promptly released them to the public. No one should have his tax returns released: not presidents, not politicians, not celebrities, not sports figures, not cab drivers.

Released was nearly 6,000 pages of six years of individual and business income tax returns for the years 2015 through 2020. The returns show that Trump paid $750 in federal taxes in 2017, $0 in 2020, and had negative adjusted gross income in four of the six years. His highest year for charitable giving was 2017, when he donated $1.8 million.

But regardless of how “little” Trump may have paid in federal income tax, he neither wrote the tax code nor prepared his tax returns. His accountants merely did for him what they did for other rich businessmen. If there are loopholes, deductions, and credits that Trump’s accountants took advantage of, then good for them. As Supreme Court Justice Learned Hand wrote in the Helvering v. Gregory (1935) case: “Anyone may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one’s taxes.”

Democrats took the opportunity to blast “the rich” for using the tax code to their advantage: “Trump’s returns likely look similar to those of many other wealthy tax cheats—hundreds of partnership interests, highly-questionable deductions, and debts that can be shifted around to wipe out tax liabilities,” said Senate Finance Chair Ron Wyden.

But who actually pays the majority of income taxes in this country?

According to the latest figures released by the Internal Revenue Service (IRS), as reported by the Tax Foundation:

The bottom 50 percent of taxpayers (taxpayers with AGI below $44,269) faced an average income tax rate of 3.5 percent.

The top 1 percent of taxpayers (AGI of $546,434 and above) paid the highest effective income tax rate of 25.6 percent — more than seven times the rate faced by the bottom 50 percent of taxpayers.

In 2019, the bottom 50 percent of taxpayers (taxpayers with AGI below $44,269) earned 11.5 percent of total AGI and paid 3.1 percent ($48.4 billion) of all federal individual income taxes.

The top 1 percent (taxpayers with AGI of $546,434 and above) earned 20.1 percent of total AGI in 2019 and paid 38.8 percent of all federal income taxes.

In 2019, the top 1 percent of taxpayers accounted for more income taxes paid than the bottom 90 percent combined. The top 1 percent of taxpayers paid $612 billion in income taxes while the bottom 90 percent paid $461 billion in income taxes.

But this is not the whole picture. The IRS dataset excludes the refundable portion of tax credits. Not only do “the poor” pay little or no federal income taxes, they receive “refunds” of tax money that they never paid in via refundable tax credits like the Earned Income Tax Credit that can give them over $6,000 each year.

See the rest here

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