3 ms·

About half of Americans pay no effective tax anyway, why not set a threshold say 100k a year and if you are under it you owe no federal taxes and don't have to

About half of Americans pay no effective tax anyway, why not set a threshold say 100k a year and if you are under it you owe no federal taxes and don't have to file anything. Can make up the difference by taxing capital gains at the same rate as W2 income.

Something1234 3y ago
Because of the earned income tax credit. It’s involved and stupid how much welfare is done through that program. Plus congress wants the poor idiots who vote republican to feel like taxes are a punishment otherwise how will they whip up their base.
- triceratops 3y ago
  Correction: they want all poor idiots (I include myself here) to feel like taxes are a punishment so that they will want to vote Republican.
  - asdff 3y ago
    Not just the poor idiots, but the rich idiots too. Paying taxes isn't so bad once you realize that money was spoken for from the minute it hit your checking account.
    - triceratops 3y ago
      Paying taxes is (mostly) fine. Filing taxes sucks. Politicians don't understand that making the filing process suck won't change how I feel about paying taxes. It will change how I feel about them.
  - deprecative 3y ago
    Two Santa Claus theory.
autoexecbat 3y ago
Does the IRS have way to know all of your income?
- willcipriano 3y ago
  Your bank, employer, cash app and brokerage all report to the IRS so unless you are a drug dealer or similar, yeah for the most part they already know it. Heres the best bit, people working under the table are going to be making less than 100k generally so it doesn't really matter, anyone making real money will be making big enough waves in the financial system to be detected, small movements of cash doesn't matter at this scale. The highly taxed routes (capital gains) are also already highly policed for tax purposes so no transition is needed there.
  - jdsully 3y ago
    Banks don't report every transaction and even if they did it may not be "income". E.g. moving money from one account to another is a transaction but no income was earned and it is not taxable.
    - voxl 3y ago
      How does this meaningfully affect the thesis of the comment you're responding to? What is the point of nitpicking something like this? I conjecture there isn't a point beyond "I found someone wrong in a comment you spent less than 5 minutes on even though the core thesis is still correct."
      - jdsully 3y ago
        Its not possible for the IRS to auto create a return for you from your bank statements full stop. The idea is flawed. Surveys show as much as half of workers make money outside normal employment so this is not some obscure side effect but the common case. [1] https://finance.yahoo.com/news/side-gigs-2023-50-americans-110022968.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAACaSl8JyAjoKHk4kMbRfn6tHZq9jft_1onIr-_eW1gDaeS2ec7sxlBdlJQFCFhrXi3cUZK9DkBHDuGWMRvJlP-d-oKHrlVEb8bByZOsePauLicRH5rDusGe1Wweh8s_fUSkIarPTMov3hmmjroCJvmbN4PxrwPO5aI3bUsm02Rvp https://finance.yahoo.com/news/side-gigs-2023-50-americans-1...

Something1234 3y ago

Because of the earned income tax credit. It’s involved and stupid how much welfare is done through that program. Plus congress wants the poor idiots who vote republican to feel like taxes are a punishment otherwise how will they whip up their base.

triceratops 3y ago
Correction: they want all poor idiots (I include myself here) to feel like taxes are a punishment so that they will want to vote Republican.
- asdff 3y ago
  Not just the poor idiots, but the rich idiots too. Paying taxes isn't so bad once you realize that money was spoken for from the minute it hit your checking account.
  - triceratops 3y ago
    Paying taxes is (mostly) fine. Filing taxes sucks. Politicians don't understand that making the filing process suck won't change how I feel about paying taxes. It will change how I feel about them.
- deprecative 3y ago
  Two Santa Claus theory.

autoexecbat 3y ago

Does the IRS have way to know all of your income?

willcipriano 3y ago
Your bank, employer, cash app and brokerage all report to the IRS so unless you are a drug dealer or similar, yeah for the most part they already know it. Heres the best bit, people working under the table are going to be making less than 100k generally so it doesn't really matter, anyone making real money will be making big enough waves in the financial system to be detected, small movements of cash doesn't matter at this scale. The highly taxed routes (capital gains) are also already highly policed for tax purposes so no transition is needed there.
- jdsully 3y ago
  Banks don't report every transaction and even if they did it may not be "income". E.g. moving money from one account to another is a transaction but no income was earned and it is not taxable.
  - voxl 3y ago
    How does this meaningfully affect the thesis of the comment you're responding to? What is the point of nitpicking something like this? I conjecture there isn't a point beyond "I found someone wrong in a comment you spent less than 5 minutes on even though the core thesis is still correct."
    - jdsully 3y ago
      Its not possible for the IRS to auto create a return for you from your bank statements full stop. The idea is flawed. Surveys show as much as half of workers make money outside normal employment so this is not some obscure side effect but the common case. [1] https://finance.yahoo.com/news/side-gigs-2023-50-americans-110022968.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAACaSl8JyAjoKHk4kMbRfn6tHZq9jft_1onIr-_eW1gDaeS2ec7sxlBdlJQFCFhrXi3cUZK9DkBHDuGWMRvJlP-d-oKHrlVEb8bByZOsePauLicRH5rDusGe1Wweh8s_fUSkIarPTMov3hmmjroCJvmbN4PxrwPO5aI3bUsm02Rvp https://finance.yahoo.com/news/side-gigs-2023-50-americans-1...