Who Is Paying Taxes - Part II

Who is paying taxes

Well here is new data about who is paying taxes, some of which is quite concerning.

About 47 percent will pay no federal income taxes at all for 2009!!

Here are some disturbing points:

...a family of four making as much as $50,000 will owe no federal income tax for 2009...

Less noticed were tax cuts for low- and middle-income families, which were expanded when Obama signed the massive economic recovery package last year.

The result is a tax system that exempts almost half the country from paying for programs that benefit everyone, including national defense, public safety, infrastructure and education.

The bottom 40 percent, on average, make a profit from the federal income tax, meaning they get more money in tax credits than they would otherwise owe in taxes. For those people, the government sends them a payment.

In 2007, about 38 percent of households paid no federal income tax, a figure that jumped to 49 percent in 2008, according to estimates by the Tax Policy Center.

But income tax rates were lowered at every income level. The changes made it relatively easy for families of four making $50,000 to eliminate their income tax liability.

Here's how they did it, according to Deloitte Tax:


The family was entitled to a standard deduction of $11,400 and four personal exemptions of $3,650 apiece, leaving a taxable income of $24,000. The federal income tax on $24,000 is $2,769.
With two children younger than 17, the family qualified for two $1,000 child tax credits. Its Making Work Pay credit was $800 because the parents were married filing jointly. The $2,800 in credits exceeds the $2,769 in taxes, so the family makes a $31 profit from the federal income tax. That ought to take the sting out of April 15.

As I said before, when you get half the people in a nation that do not pay for any services that the nation provides, the system will never change. Why would anyone who is receiving benefits from the government want to change the system. The national debt will continue to rise and it will cost those of us that pay taxes more. Our "share" of the cost of government will go up!