100 Days Until Taxmageddon

Sunday will mark the start of the 100-day countdown to “Taxmageddon” – the date the largest tax hikes in the history of America will take effect. They will hit families and small businesses in three great waves on January 1, 2013:

First Wave: Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for small business owners, families, and investors (later re-upped by President Obama and Democrat Congress in 2010). The following tax hikes will occur on January 1, 2013:

Personal income tax rates will rise on January 1, 2013. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which the majority of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below:

-The 10% bracket rises to a new and expanded 15%
-The 25% bracket rises to 28%
-The 28% bracket rises to 31%
-The 33% bracket rises to 36%
-The 35% bracket rises to 39.6%

Higher taxes on marriage and family coming on January 1, 2013. The “marriage penalty” (narrower tax brackets for married couples) will return from the first dollar of taxable income. The child tax credit will be cut in half from $1000 to $500 per child. The standard deduction will no longer be doubled for married couples relative to the single level.

Middle Class Death Tax returns on January 1, 2013. The death tax is currently 35% with an exemption of $5 million ($10 million for married couples). For those dying on or after January 1 2013, there is a 55 percent top death tax rate on estates over $1 million. A person leaving behind two homes and a retirement account could easily pass along a death tax bill to their loved ones.

Higher tax rates on savers and investors on January 1, 2013. The capital gains tax will rise from 15 percent this year to 23.8 percent in 2013. The top dividends tax will rise from 15 percent this year to 43.4 percent in 2013. This is because of scheduled rate hikes plus Obamacare’s investment surtax.

Second Wave: Obamacare Tax Hikes

There are twenty new or higher taxes in Obamacare. Some have already gone into effect (the tanning tax, the medicine cabinet tax, the HSA withdrawal tax, W-2 health insurance reporting, and the “economic substance doctrine”). Several more will go into effect on January 1, 2013. They include:

The Obamacare Medical Device Tax begins to be assessed on January 1, 2013. Medical device manufacturers employ 409,000 people in 12,000 plants across the country. This law imposes a new 2.3% excise tax on gross sales – even if the company does not earn a profit in a given year. Exempts items retailing for <$100.

The Obamacare Medicare Payroll Tax Hike takes effect on January 1, 2013. The Medicare payroll tax is currently 2.9 percent on all wages and self-employment profits. Starting in 2013, wages and profits exceeding $200,000 ($250,000 in the case of married couples) will face a 3.8 percent rate.

The Obamacare “Special Needs Kids Tax” comes online on January 1, 2013. Imposes a cap on FSAs of $2500 (now unlimited). Indexed to inflation after 2013. There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. This Obamacare cap harms these families.

The Obamacare “Haircut” for Medical Itemized Deductions goes into force on January 1, 2013. Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI). The new provision imposes a threshold of 10 percent of AGI. Waived for 65+ taxpayers in 2013-2016 only.

Third Wave: The Alternative Minimum Tax and Employer Tax Hikes

When Americans prepare to file their tax returns in January of 2013, they’ll be in for a nasty surprise—the AMT won’t be held harmless, and many tax relief provisions will have expired. These tax increases will be in force for BOTH 2012 and 2013. The major items include:

The AMT will ensnare over 31 million families, up from 4 million last year. According to the left-leaning Tax Policy Center, Congress’ failure to index the AMT will lead to an explosion of AMT taxpaying families—rising from 4 million last year to 31 million. These families will have to calculate their tax burdens twice, and pay taxes at the higher level. The AMT was created in 1969 to ensnare a handful of taxpayers.

Full business expensing will disappear. In 2011, businesses can expense half of their purchases of equipment. Starting on 2013 tax returns, all of it will have to be “depreciated” (slowly deducted over many years).

Taxes will be raised on all types of businesses. There are literally scores of tax hikes on business that will take place. The biggest is the loss of the “research and experimentation tax credit,” but there are many, many others. Combining high marginal tax rates with the loss of this tax relief will cost jobs.

Tax Benefits for Education and Teaching Reduced. The deduction for tuition and fees will not be available. Tax credits for education will be limited. Teachers will no longer be able to deduct classroom expenses. Coverdell Education Savings Accounts will be cut. Employer-provided educational assistance is curtailed. The student loan interest deduction will be disallowed for hundreds of thousands of families.

Charitable Contributions from IRAs no longer allowed. Under current law, a retired person with an IRA can contribute up to $100,000 per year directly to a charity from their IRA. This contribution also counts toward an annual “required minimum distribution.” This ability will no longer be there.



Posted by Ryan Ellis on Friday, September 21, 2012 10:19 AM EDT
http://www.atr.org/days-taxmageddon-a7203

What is a Republic? A Democracy? Understanding the American Form of Government

A really great video explaining the differences between a Democracy and a Republic. Very informative and easy to understand. This is a short video (10:35) but delivers a great lesson that every American needs to understand.

"2016 Obama's America" - Movie Preview

2016 Obama's America takes audiences on a gripping visual journey into the heart of the world’s most powerful office to reveal the struggle of whether one man's past will redefine America over the next four years. The film examines the question, "If Obama wins a second term, where will we be in 2016?"

Chairman Obama's 2-million person Truth Team

article from: RT.com

Desperate to win re-election, President Obama is taking inspiration from a tactic used by China’s Chairman Mao during so-called "Cultural Revolution."

In order to spread his ideology, he creates his own army of brainwashed propagandists who are supposed to popularize talking points sent to them directly from the White House.

Modern days hongweibings (Chinese for red guards) are called the Truth Team, and if everything goes as planned, the president will have an army of over two million Americans on his side.

What If The Government Takes Over Wikipedia?

article by: Gongalo Lira

As most people know, Wikipedia will go offline on Wednesday—in protest over the Stop Online Piracy Act (SOPA) and the Protect Intellectual Property Act (PIPA). The Financial Times has a brief but fairly comprehensive overview of what’s going on here.

Will Hunting Got It, Why Don't Most Americans

I was watching the movie Good Will Hunting this evening and having not seen the movie since it was released I had forgotten about the following scene of the movie. Looking back I am amazed that this scene actually made it into the movie. The two minutes of dialog in this scene speak volumes about US foreign policies.

Are We Seeing The Build Up To World War III?

article by Craig Hasten

I hope the American people are paying close attention to the what is going on around the globe recently. After 21 years of war in the Middle East it looks like The United States is setting the stage for the next conflict. It was announced yesterday that the CVN 70 Carl Vinson battle group entered the Arabian Sea off the Straits of Hormuz joining the CVN 74 John Stennis battle group which has been in the area for the past two months.

Now riddle me this!

The Romney Con

As we start to see the race for the White House heat up I find myself wondering what happened to the desire that everyone felt for "Change" three years ago. It quickly became obvious to those that voted for him that Obama had no intentions to delivering his promise of "Hope and Change" that got him elected in 2008. Never before had we seen such support for a candidate that simply promised two things, "Hope and Change".

Sadly, it looks like the American people who cried out for a change from the business as usual politics are being led down the same path again.

Penn State; My Final Loss Of Faith

By Thomas L. Day

I’m 31, an Iraq war veteran, a Penn State graduate, a Catholic, a native of State College, acquaintance of Jerry Sandusky’s, and a product of his Second Mile foundation.

And I have fully lost faith in the leadership of my parents’ generation.

Penn State football coach Joe Paterno arrives home Wednesday, Nov. 9, 2011, in State College, Pa. (Matt Rourke - AP)
(Read Day’s follow up to this post in his chat Monday with readers here. )

I was never harmed by Sandusky, but I could have been. When I was 15, my mother, then looking for a little direction for her teenage son, introduced me to the Second Mile’s Friend Fitness program. It was a program resembling Big Brother, Big Sister with a weekly exercise regimen.

Epic Failure: The Supercommittee Was A Super Joke

article from: The Economic Collapse



Does anyone need any additional evidence that our political system is completely broken?  The bipartisan congressional supercommittee that was given two months to come up with at least $1.2 trillion in deficit cuts over the next decade has failed to reach an agreement.  It is an epic failure and a national embarrassment.  The truth is that they never even came close to an agreement.  In fact, as you will read below, the two sides on the panel have been barely even talking to each other.  In the end, the supercommittee was a super joke.  Meanwhile, the U.S. national debt has passed the 15 trillion dollar mark and we are facing trillion dollar deficits as far as the eye can see.  We are heading directly for a national financial disaster, and our "leaders" seem powerless to do anything about it.

Horrible Bosses, Pitchforks & Torches

D. Sherman Okst
Zero Hedge
November 22, 2011

If you haven’t seen the movie “Horrible Bosses” I’d recommend that you do. Please see it. Go enjoy yourself. As bad as things are getting it is incredible to realize that we can still laugh.

And trust me, you’ll laugh hard at this movie.

When I left the theater with my wife, I realized why it was that movie theaters did well in the last Great Depression. For an hour and forty minutes we escaped all the negativity that has crept into this world. It had a long lasting effect. For at least a week I was in a good mood.

I AM NOT MOVING - Short Film - Occupy Wall Street

Incredible Speech By Wall Street Protester "End The Fed" 2011

In all the media coverage I have viewed over the course of the past few weeks I failed to hear anyone who put forth a compelling argument as to what they were protesting against. Then I saw this young man and I was truly blown away. Here is a young man who truly understands what is going on in this country and gives one of the best speeches I have heard in a long time.

Obama Goes All Out For Dirty Banker Deal

by Matt Taibbi / Rolling Stone

A power play is underway in the foreclosure arena, according to the New York Times.

On the one side is Eric Schneiderman, the New York Attorney General, who is conducting his own investigation into the era of securitizations – the practice of chopping up assets like mortgages and converting them into saleable securities – that led up to the financial crisis of 2007-2008.

On the other side is the Obama administration, the banks, and all the other state attorneys general.

This second camp has cooked up a deal that would allow the banks to walk away with just a seriously discounted fine from a generation of fraud that led to millions of people losing their homes.

The idea behind this federally-guided “settlement” is to concentrate and centralize all the legal exposure accrued by this generation of grotesque banker corruption in one place, put one single price tag on it that everyone can live with, and then stuff the details into a titanium canister before shooting it into deep space.

‘Before NATO intrusion, Libya was African Switzerland’

Jon Stewart Wants To Know: Why Is The Media Ignoring Ron Paul?

Over the weekend Dr. Ron Paul placed second in the Iowa Ames Straw Poll by a narrow margin of 200 votes behind Michelle Bachmann. One would have thought that the canidate who came in second in the Straw Poll would have received some serious media attention right?

Wrong!

As Jon Stewart points out in this clip from his show "The Daily Show", there seems to be a complete media blackout on Dr. Ron Paul. Furthermore I find it troublesome how the clip shows how every news outlet is on board with blackballing Dr. Ron Paul.

Bank of America's Back-Door TARP!

Taxpayer-owned Fannie Mae just bought the servicing rights to a bunch of bad loans from the struggling Bank of America. Where does it end?

By Abigail Field

FORTUNE -- Taxpayers may not realize it, but they just bailed out Bank of America again, this time to the tune of more than a half billion dollars.

The Charlotte, NC-based bank was one of the biggest recipients of bailout funds during the financial crisis. But Bank of America (BAC) continues to face deep problems related to its troubled mortgage portfolio and investors have battered the stock, which has plunged over 40% so far this year. That's escalated concerns that the bank may need to raise more capital. Yves Smith at Naked Capitalism has even started a BofA death watch.

Video: MSNBC’s Dylan Ratigan has a meltdown over the meltdown

Finally, someone at MSNBC has the balls to say on air what the root of the problems is in this country. Money and politics!

MSNBC's Dylan Ratigan is mad as hell about the U.S. financial crisis--and he's not gonna take it anymore!
While convening a roundtable discussion on the market meltdown on his eponymous MSNBC show on Tuesday, Ratigan exploded.

"We've got a real problem!" an exasperated Ratigan shouted. "This is a mathematical fact! Tens of trillions of dollars are being extracted from the United States of America. Democrats aren't doing it, Republicans aren't doing it. An entire integrated system, financial system, trading system, taxing system, that was created by both parties over a period of two decades is at work on our entire country right now. And we're sitting here arguing about whether we should do the $4 trillion plan that kicks the can down the road for the president for 2017, or burn the place to the ground, both of which are reckless, irresponsible, and stupid."

Lets Take A Moment To Dissect Bernake's Latest Zero Interest Rate Policy

by: Bruce Krasting / ZeroHedge.com

I had this to say last week:

The Fed could easily attempt to buy some market peace by issuing a statement that the policy of zero interest rates would be extended for a minimum period of one year. I consider this to be a “high probability" to happen in the next 30 days.

I got it right, but I got it completely wrong. I feared that the Fed could extend the ZIRP language for as long as a year. Not in my wildest dream did I think they could take the extremely risky move of guaranteeing that interest rates will remain at zero for another 24 months.

Having been shocked, my thoughts.

I'm 63 and I'm Tired

By Robert A. Hall


I'm 63. Except for one semester in college when jobs were scarce and a six-month period when I was between jobs, but job-hunting every day, I've worked, hard, since I was 18. Despite some health challenges, I still put in 50-hour weeks, and haven't called in sick in seven or eight years. I make a good salary, but I didn't inherit my job or my income, and I worked to get where I am. Given the economy, there's no retirement in sight, and I'm tired.

Very tired.