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> The middle and lower classes pay basically 0 tax, or even get refunds (negative taxes) This is a common misunderstanding of how taxes work, or specifically w
by roganartu 6y ago
> The middle and lower classes pay basically 0 tax, or even get refunds (negative taxes)
This is a common misunderstanding of how taxes work, or specifically what refunds mean. Getting a refund does not mean you paid zero or negative tax. Getting a refund simply means that you had more tax withheld than you should have. The tax withheld from your regular paycheck is not authoritative, it's just a prepayment of your estimated tax bill for the year, and it is almost always slightly inaccurate.
You can see this for yourself assuming you earn above the poverty line. Your tax return has three fields related to this: total tax withheld, total taxable income, and the tax owed given your taxable income. Getting a refund just means the tax withheld is greater than the tax owed. The total tax owed on your tax return is the tax you actually paid for the year, and for the vast majority of people it is >$0 even if they get a refund. In fact, the approximate tax paid on the median US household income (~$68k) would be ~$13k (assuming the household files a joint married return) which is decidedly non-zero.
- pandaman 6y agoGetting a refund does not necessarily mean that you paid zero or negative tax, that's true, but when you pay zero or negative tax you do get a refund too. E.g. you can get negative taxation through https://en.wikipedia.org/wiki/Earned_income_tax_credit https://en.wikipedia.org/wiki/Earned_income_tax_credit
- Godel_unicode 6y agoThis is absolutely not true, many people get refunds in excess of their payments, and many people in this category pay no taxes and still get refunds as a result. This is by design.