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On the other hand, that's a whole lot of people -- probably almost everyone who is not a homeowner, and quite a few who are.
by amalcon 3y ago
On the other hand, that's a whole lot of people -- probably almost everyone who is not a homeowner, and quite a few who are.
- ghaff 3y agoThat list suggests that if you have a 1099 (which I assume is most people with meaningful savings), you probably won't qualify.
- bigbillheck 3y agoI think there are probably a lot fewer people with meaningful savings than you might think.
- ghaff 3y agoIt looks like about half have brokerage accounts although some of those are probably just 401Ks and there's obviously a strong correlation with income levels.
- jancsika 3y agoI'd bet once you start digging down into the details, having a brokerage account becomes less and less relevant as a metric for who can pay simple taxes. For example, how many of those respondents in the Gallup poll answered yes only because they have a Simple IRA? For those respondents, their contributions don't preclude them from taking the "simple tax" branch when filing taxes. (That's the "simple" part-- well, one of the simple parts, at least for the employee.) Moreover, there were some changes to simple IRA administration in Secure 2.0 act that make automatic enrollment mandatory (for the employer to do 3% matching or whatever). So the category of respondent I mentioned above-- who technically has a brokerage account but can file simple taxes-- is likely to grow quite a bit in the next few years and decades. Edit: I'd also be interested in how many people with simple IRAs contribute anything more than the 3% matching-- I'd bet its more than a majority. Perhaps that could change now that Secure 2.0 lets them contribute to a Roth IRA.
- kgermino 3y agoEspecially meaningful savings with taxable interest. Yes, most people with more than a few hundred bucks in savings accounts will get a 1099-INT, but a lot of people just use checking accounts and if you're at a big bank like Chase even savings account interest is so low you still might be under the $10 threshold. The average American's investments (if they have any at all) are in retirement accounts so they'd avoid those taxes too.
- junar 3y ago"Interest of $1,500 or less" is eligible according to the announcement. Dividends and capital gains are not mentioned, and presumably not eligible.
- deleted 3y ago[deleted]
- amalcon 3y ago> Interest of $1,500 or less The only 1099 that most people will get, even with meaningful savings, meets this description.
- greyface- 3y ago"Gig work" typically results in 1099 rather than W-2 income, and is common.
- smt88 3y agoGig work is not common[1]. It just gets disproportionate attention. 1. https://www.pewresearch.org/internet/2021/12/08/the-state-of-gig-work-in-2021/ https://www.pewresearch.org/internet/2021/12/08/the-state-of...
- greyface- 3y agoYour [1] shows 4% of Americans currently engaged in gig work, and 16% of Americans having ever done gig work. What's your threshold for 'common'?
- smt88 3y agoDefinitely more than 4% at any given time. At least 20%, I'd say. In the context of the IRS providing a useful filing tool, covering 96% of Americans' income sources would be fantastic.