401k and Mortgage deduction are on the table

[an]

[quote=flu]Enron, it doesn’t matter .Both parties always throw the moderate wealthy under the bus..They just call it differently.

GOP calls moderate wealthy “middle class”.
Democrats calls moderate wealthy “rich class”.

Whenever government needs to tax more, they just love to hit this group…

And while “wealthy means $200k for someone single”, it also means $250k for a couple….I don’t know why, but I guess maybe some people think women shouldn’t have a meaningful career after they are married but just be a stay at home mom..(and no I don’t think that way)…But regardless, it also means a LOT of you slightly above middle class families are gonna get shafted… Like I’ve been saying all along..Really rich people…Not gonna get hit by this at all..[/quote]
Ding ding ding. The tallest grass will get cut. The truly rich are not in the same lawn.

First, it’s the 1%, then 2%, then 5%, then 20%. After all, top 20% is still only 20%. 80% of the population won’t be affected. The top 20% can afford to pay a little more.

[SK in CV]

[quote=SD Realtor]It wouldn’t surprise me if some of the expenses on your schedule E are proposed for the chopping block. You know how rich all those evil landlords are.[/quote]

Because of the way the code is written, it would seem unlikely. The same code sections that allow little landlords to deduct their repairs and supplies and property taxes, are the same code sections that allows General Electric to deduct its expenses. Over the last few decades, the only deductions that have been messed with at all are depreciation and the deductibility of business meals. I don’t expect it to happen now.

[Hobie]

The higher income as well as the self employed write their own checks to pay their taxes. They see every dollar going out. The average W-2 worker just tends to look at the net so the full impact of how much tax is withheld is ‘lost in the numbers’ meaning not many study their pay stub, especially with direct deposit.

When politicians want to raise a tax they like to use the sales technique showing the lowest unit cost to you. ie. “this will only cost you $60/yr, or a penny a day, etc. Hey, you can afford that” Most simply grin and bear it as they never really write a total annual check for tax liability. This makes it easier to slide new/modified tax laws on the middle class.

I hope this makes sense as I’m out the door. I getting my hard hat as SK is gonna want to take me to the woodshed. 🙂

[SD Realtor]

I hope that is the case SK.

I have no problem with the top 1% paying more however it is a drop in the bucket with regards to the real problem.

We have a spending problem not a revenue problem.

[SK in CV]

[quote=SD Realtor]I hope that is the case SK.

I have no problem with the top 1% paying more however it is a drop in the bucket with regards to the real problem.

We have a spending problem not a revenue problem.[/quote]

It’s an attactive narrative, but it’s hardly true. It’s only a drop in the bucket if 10 drops fill the bucket. Restoring the economy to 2004 growth levels adds another 3 or 4 drops. Eliminating war spending is another couple drops. Another few drops and we have a balanced budget.

[moneymaker]

flu… Didn’t i make that recommendation a while back about getting access to one’s 401K without penalty. Wouldn’t cost the government a dime and would definitely spur the economy on. Did I just end a sentence with a run on?

[SD Realtor]

No I don’t think it is a narrative at all. Given the cost to service our debt if we even see a modest rise in the interest rates we are in big trouble. I agree with you about war spending. We may or may not see an economy to 2004 growth levels but I doubt we will see sub 5% employment levels. Seems to me we are also seeing substantial increases in general welfare spending, food stamps, etc. While reduction in defense spending is needed, the resulting rise in unemployed white collars will not be consumed by the private sector.

So, I guess while your post makes sense about a few drops here and there, physical evidence especially over the past 4 years are absolutely contrary to it. I guess we will see how things go this year.

So yes to me it is a spending issue and that is not just narrative. It was under Bush and it has been perpetuated by Obama.

[SK in CV]

[quote=SD Realtor]No I don’t think it is a narrative at all. Given the cost to service our debt if we even see a modest rise in the interest rates we are in big trouble. I agree with you about war spending. We may or may not see an economy to 2004 growth levels but I doubt we will see sub 5% employment levels. Seems to me we are also seeing substantial increases in general welfare spending, food stamps, etc. While reduction in defense spending is needed, the resulting rise in unemployed white collars will not be consumed by the private sector.

So, I guess while your post makes sense about a few drops here and there, physical evidence especially over the past 4 years are absolutely contrary to it. I guess we will see how things go this year.

So yes to me it is a spending issue and that is not just narrative. It was under Bush and it has been perpetuated by Obama.[/quote]

I’m sure you understand that the increase in welfare and similar spending (including direct payments, SNAP, EITC, federal unemployment, medicaid, etc.) are all a function of the economy. None of these programs have undergone any signficant expansion in eligibility or benefits in years. If the economy expands, the costs of these programs drop proportionally. If the economy improves, we’ve cut spending. That was the entire basis of the republican candidate’s plan to move towards a balanced budget. His path just couldn’t possibly get us there.

[SD Realtor]

Your entire premise appears to be based on a belief that we will return to the way things were. I don’t think that is true at all. Your argument about a return to 2004 levels to me is not solid. I think it is safe to say that the 2004 economy was robust but for the wrong reasons, (see a housing boom fueled by unrealistic pricing and artificially low rates). This is not about any republican candidate at all. It is about the current level of spending and the lack of economic growth, not about increased revenues.

[SK in CV]

[quote=SD Realtor]Your entire premise appears to be based on a belief that we will return to the way things were. I don’t think that is true at all. Your argument about a return to 2004 levels to me is not solid. I think it is safe to say that the 2004 economy was robust but for the wrong reasons, (see a housing boom fueled by unrealistic pricing and artificially low rates). This is not about any republican candidate at all. It is about the current level of spending and the lack of economic growth, not about increased revenues.[/quote]

No, my premise is drops. And how a few drops can go a long ways.

[(former)FormerSanDiegan]

[quote=enron_by_the_sea][quote=flu]
It doesn’t quite work that way enron…When you rent out a house to someone else, you can deduct the mortgage as an expense but you also have to report the rental income.

However, if you rent someone else’s house, you can’t deduct your rental cost (unless your poor..And in that case, you probably can’t qualify to buy a home)…

So I’m not sure how this would be beneficial for you…Seems like a lot of paperwork to report a $0 gain.[/quote]

Oops. That is probably why this does not work. Nevermind.[/quote]

Don’t give up so easily.
I think it can work

If your goals of owning are:
1. To lock in monthly housing costs long term
2. To participate in future capital appreciation of property
this strategy works.
The rent you pay will track the rent you charge… so the amount you pay will remain fixed. At some point.in the future the interest and other costs will.be less than the standard deduction and you might actually come out ahead.

[mike92104]

Federal Spending:

2004 – 2.29 Trillion
2012 – 3.80 Trillion

65.9% increase.

I’d love to go back to the spending levels of 2004!

[(former)FormerSanDiegan]

On a related note, why is nobody talking about raising taxes on the 100%?

Food for thought: much revenue would be generated with a 1% across the board tax increase in all tax brackets, plus a 1% increase on capital gains and dividends?
Same for corporate tax rates.

12 trillion in personal income (2010) yields 120 billion.

Make it apply to all income ( no deductions) and name it the Patriot Tax Act.

[(former)FormerSanDiegan]

[quote=mike92104]Federal Spending:

2004 – 2.29 Trillion
2012 – 3.80 Trillion

65.9% increase.

I’d love to go back to the spending levels of 2004![/quote]

How about a compromise? Go back to 2004 spending + inflation AND implement the 1% Patriot tax act. Problem solved.

[an]

[quote=FormerSanDiegan]The rent you pay will track the rent you charge… so the amount you pay will remain fixed. At some point.in the future the interest and other costs will.be less than the standard deduction and you might actually come out ahead.[/quote]
I don’t think it always work out that way. If you have a good tenant, you definitely don’t want to raise their rent while they’re in there, at least while rent are rising slowly. It’ll cost you more to clean up and find another tenant and lost rent during the time in between. While on the other end, you’re at the mercy of your landlord. If you have a landlord who want to raise your rent, you have no choice but to obey, or you can move and still pay market rent. If your landlord doesn’t do proper repairs and you end up moving, you’d have to pay market rent as well.

[Author]

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