Why the U.S. is going BANKRUPT
Here's a rough-out of my tax situation. I'm retired. Last year I had approximately $100,000 of gross income, almost all in the form of qualified dividends, from various sources, including part of the earnings of my mother's estate from the prior years. After exemptions and itemized deductions, that was reduced to taxable income of about $82,000.
Now, I knew that the Bush tax cuts limited the top tax rate on qualified dividends to the ridiculously low rate of 15%, so I assumed I would be paying tax of about 15% on almost the entire $82,000, which would result in taxes of about $12,000. I was absolutely floored when the accountant told me my total taxes would be about $2,100 (little more than 2.5% of my taxable income). But, as it turns out, under the BUSH TAX CUTS, the first $67,900 (for married persons filing joint returns) of taxable income derived from qualified dividends is NOT TAXED AT ALL. That's right. The tax on the first $67,900 of income from qualified dividends is not taxed at all. The total tax is zero, zippo, nada, nil!
So, I am only taxed on the difference between the $82,000 and the 67,900 (i.e., on $14,100), and even then the tax is limited to 15%. So, in the end, my total tax is just a shade over $2,100.
And you wondered why we're going bankrupt in this country! My state income taxes are higher than my federal taxes!
Meanwhile, of course, a person who had taxable income of only $16,800 in taxable income from "earned income" sources would pay the same tax I do. That's roughly what someone earning the minimum wage would make. And, the rich still complain they pay too much in taxes!
Jesus must be weeping.