Author Topic: Good tax news for U.S-based microstockers (Read 5006 times)

zimmytws · « **on:** December 11, 2010, 17:43 »

It looks like the recent tax laws passed by Congress will be giving us about a 2% or 4% break on our 2011 taxes. Since the SS tax rate is being cut from 6.2% to 4.2% and as "self-employed" workers, we also pay the "employer" portion of the SS taxes, that means we should get 4%(or 2% for sure) break in 2011. (although I am not 100% sure the "employer" part is being reduced)
That should at least help offset some of the hit many of us will be taking at IS in the new year.

http://finance.yahoo.com/news/With-Tax-Deal-Obama-Makes-Bet-dg-894885590.html?x=0

lisafx · « **Reply #1 on:** December 11, 2010, 17:51 »

Sorry to be a total wet blanket, but I would much rather they keep the 2-4% and apply it to the massive deficit. All these tax giveaways are just being borrowed from China.

michaeldb · « **Reply #2 on:** December 11, 2010, 18:09 »

Quote from: lisafx on December 11, 2010, 17:51

... I would much rather they keep the 2-4% and apply it to the massive deficit.

Good news, you are free to give the money back if you want to. On your 1040 tax form, you can choose to pay as much as you want to over and above what you owe.

Me, I'll be keeping the money. I don't think we have a taxes-are-too-low problem in the US, I think we have a government-spends-too much problem. If we give gov more money, they will just spend it.

Until spending is brought under control, deficits will continue to grow. Gov can always spend more more than we pay in taxes, no matter how high taxes go.

pancaketom · « **Reply #3 on:** December 11, 2010, 18:27 »

While any more $ into my pocket are appreciated, I fear this is really a back door to try to damage social security. Look, we took away the payroll taxes for a few years so we could keep the billionaires tax cuts and now your retirement is unsustainable. Sorry. I am feeling cynical this evening.

michaeldb · « **Reply #4 on:** December 11, 2010, 18:41 »

Quote from: pancaketom on December 11, 2010, 18:27

...your retirement is unsustainable...

'unsustainable'

IS and SS (meaning 'Social Security, not Shutterstock) are both Ponzi schemes?

zimmytws · « **Reply #5 on:** December 11, 2010, 19:04 »

...and I realized my original post was a little confusing, because I used "SS" to refer to Social Security, not Shutterstock as is customary here.

KB · « **Reply #6 on:** December 11, 2010, 19:10 »

Quote from: zimmytws on December 11, 2010, 19:04

...and I realized my original post was a little confusing, because I used "SS" to refer to Social Security, not Shutterstock as is customary here.

So no break on the Shutterstock tax rate after all?

The employer part is not being reduced, so self-employment tax will be 10.4% instead of 12.4% (plus Medicare's 2.9%, of course).

zimmytws · « **Reply #7 on:** December 11, 2010, 19:43 »

I really think it would have been better to have reduced only the employer part by 2%, and left the employee rate at 6.2%. Having to pay both parts as a self-employed worker is unfair, but Lisa is right, Social Security is going broke, so at some point, all the tax rates are going to have to be raised. But I think there is some validity in cutting taxes when the economy is in the toilet.

Sean Locke Photography · « **Reply #8 on:** December 11, 2010, 20:13 »

Yeah, I think things should stay the same, plus 2%, straight to the debt. Not to adding more entitlements. And not just me. Everyone.

louoates · « **Reply #9 on:** December 11, 2010, 20:18 »

I just knew this topic would get political real fast. Social security is going broke unless fixed with a sensible solution. It was the world's largest Ponzi scheme at the beginning, middle, and fast approaching final stage. Time to pull the plug on it.

lisafx · « **Reply #10 on:** December 11, 2010, 20:49 »

Quote from: sjlocke on December 11, 2010, 20:13

Yeah, I think things should stay the same, plus 2%, straight to the debt. Not to adding more entitlements. And not just me. Everyone.

Exactly! Spending cuts, tax hikes - if we don't get the deficit under control and start paying off the debt it won't be either or. It will be BOTH. By a whole lot.

adijr · « **Reply #11 on:** December 11, 2010, 21:07 »

I am a canadian living in the US as a student. Canadian taxes are skyhigh compared to here. Most people I know in Canada and with whom I've at least mentioned finances are quite content to pay their taxes, even those taxed at 50%.

I am really curious why (some?) people are sooo eager to not pay taxes here in the US. In my mind, the equation was very simple, more taxes = more social programs, infrastructure, etc. (of course, assuming no excess of corruption). Even if I don't always agree with how the money is being spent, wanting the money back in my pocket is *not* the right choice, IMO. Coming from Downtown Toronto (5.5 million people in the GTA) to Boston there's a large difference in infrastructure, cleanliness and social programs, and from what I understand Massachusetts is one of more social systems around.

Like I said, I'm just a visitor to stock and the US, but I'm wondering why people value the stuff tax money (is supposed to) pay for a lot less than 'money in your pocket'. Or is that you don't trust the government to pay for the right stuff?

lisafx · « **Reply #12 on:** December 11, 2010, 21:20 »

Quote from: adijr on December 11, 2010, 21:07

Like I said, I'm just a visitor to stock and the US, but I'm wondering why people value the stuff tax money (is supposed to) pay for a lot less than 'money in your pocket'. Or is that you don't trust the government to pay for the right stuff?

I wish I could explain it to you, but it baffles me too. I think a big part of the problem is Americans don't see our tax money being spent on programs that benefit us. We don't have universal, single payer healthcare, we don't have much in the way of a social safety net, our infrastructure has been crumbling for a few decades, etc. Meanwhile we are growing broke fighting unwinable wars all over the globe. On top of that, we are constantly propagandized that paying taxes is evil, and social programs are money wasted supporting lazy worthless people.

Not all Americans think that way, but those of us who don't are generally shouted down by the others. If you don't believe it, watch what happens in this thread after my post

adijr · « **Reply #13 on:** December 11, 2010, 21:26 »

Quote from: lisafx on December 11, 2010, 21:20

Quote from: adijr on December 11, 2010, 21:07

Like I said, I'm just a visitor to stock and the US, but I'm wondering why people value the stuff tax money (is supposed to) pay for a lot less than 'money in your pocket'. Or is that you don't trust the government to pay for the right stuff?

I wish I could explain it to you, but it baffles me too. I think a big part of the problem is Americans don't see our tax money being spent on programs that benefit us. We don't have universal, single payer healthcare, we don't have much in the way of a social safety net, our infrastructure has been crumbling for a few decades, etc. Meanwhile we are growing broke fighting unwinable wars all over the globe. On top of that, we are constantly propagandized that paying taxes is evil, and social programs are money wasted supporting lazy worthless people.

Not all Americans think that way, but those of us who don't are generally shouted down by the others. If you don't believe it, watch what happens in this thread after my post

"If you don't believe it...". On the contrary, this was exactly my impression, but I'm eager to hear people's actual opinions and answers - maybe they can tell me why they think how they do.

I've met quite a few people so far whose parents have voted republican since the 60s or 70s, and they're respecting that regardless of how things change. (I'm not bashing on republicans here this is just the case study of people I've met. It may well be that way with other parties). It's a confusing mind set.

Graffoto · « **Reply #14 on:** December 11, 2010, 23:31 »

The USA are the de-Facto 'world police'.
Huge amounts of our taxes go to the military industrial complex.

More huge amounts go international aid programs.
No one throws more money at other countries in need than the US.
And for the most part all we get is grief in return.

Canada has a socialist system. Socialized medical, heavily subsided transportation systems, etc, etc.

Its an apples vs oranges argument.
Aside from speaking English, our two countries are really nothing alike.
(PS - I was married to a Canadian for 24 years and went to visit many times - so I know a bit about it).

adijr · « **Reply #15 on:** December 12, 2010, 00:30 »

Quote from: nosaya on December 11, 2010, 23:31

Canada has a socialist system. Socialized medical, heavily subsided transportation systems, etc, etc.

Its an apples vs oranges argument.

Could you explain a little more why it's an apples vs oranges ~~argument~~ question? In the items you gave as an example, it sounds to me like a choice of what to do with money.

A side point - I looked up some data, and you are indeed right the US seems to be a very strong aid-giving country, but this also has to do with size. Per capita, US seems to me below many others, including Canada. This is not to say US is not giving enough - again, I'm sure you can easily argue the opposite. Yet you can see why I'm confused about you saying this is apples vs Oranges.
src: http://www.globalissues.org/article/35/foreign-aid-development-assistance#ForeignAidNumbersinChartsandGraphs

Also I wouldn't go as far as saying that the only thing we have in common is English

I mean, come on, we also tend to launch equally strong microstock business at least.

Graffoto · « **Reply #16 on:** December 12, 2010, 00:59 »

OK, I'm not much of a typist so I tend to say things in as brief a way as possible.
Of course we have more in common than language.... but our governments work much differently.

People generally don't mind paying taxes when they see services that they can use being implemented with that tax money.
It just does not work that way in the US.

OK, maybe we give less in reported aid per capita... but that is on top of all the military spending.
Frankly is would take volumes of books to explain the where all the tax dollars are going... pay-offs to corrupt third world regimes, monetary & military hardware support for out allies, etc, etc.

My late father worked for the CIA for a few years, based out of Turkey.
I learned some things about how the world really works from him.
Trust me, its a messy game we play.
I also held a federal government job for a few years in the 1980s.
I had a good up close and personal look at how it works.
Mostly it doesn't work.
Scads of people are employed whose only real job is trying to figure out how they can justify their positions!
Its ludicrous. Anyone that has worked for the US Federal government, will understandably be miffed about how our tax dollars are (mis)spent.

The US taxation system is broken. There are large loopholes for the very, very wealthy, while the middle class gets raped.

adijr · « **Reply #17 on:** December 12, 2010, 01:21 »

Quote from: nosaya on December 12, 2010, 00:59

OK, I'm not much of a typist so I tend to say things in as brief a way as possible.
Of course we have more in common than language.... but our governments work much differently.

People generally don't mind paying taxes when they see services that they can use being implemented with that tax money.
It just does not work that way in the US.

OK, maybe we give less in reported aid per capita... but that is on top of all the military spending.
Frankly is would take volumes of books to explain the where all the tax dollars are going... pay-offs to corrupt third world regimes, monetary & military hardware support for out allies, etc, etc.

My late father worked for the CIA for a few years, based out of Turkey.
I learned some things about how the world really works from him.
Trust me, its a messy game we play.
I also held a federal government job for a few years in the 1980s.
I had a good up close and personal look at how it works.
Mostly it doesn't work.
Scads of people are employed whose only real job is trying to figure out how they can justify their positions!
Its ludicrous. Anyone that has worked for the US Federal government, will understandably be miffed about how our tax dollars are (mis)spent.

The US taxation system is broken. There are large loopholes for the very, very wealthy, while the middle class gets raped.

Aha, okai. Thank you for the explanation. I DO believe you when you describe your world view, i just didn't understand what you meant.

So to understand the a v o from the earlier messages you meant in terms of how well the government spends its money. I can understand that. So, really, you think the main reason people want to pay low taxes is because of a lack of trust of government's ability to do something useful with them?

And other countries that do better spending (No country is perfect and let's not say that Canada or whoever else does not waste some money, but lets say less) do so because ...? Simple better people? Better transparency? More protests?

Just wondering.

cardmaverick · « **Reply #18 on:** December 12, 2010, 05:08 »

As long as there is a Federal Reserve printing money uncontrollably, YOU NEVER HAVE TAX BREAKS. It's called an "inflation tax", and we are headed for enormous amounts of it.

gaja · « **Reply #19 on:** December 12, 2010, 06:57 »

Do you really pay less than 10% tax?

PaulieWalnuts · « **Reply #20 on:** December 12, 2010, 08:28 »

Quote from: adijr on December 11, 2010, 21:07

I am really curious why (some?) people are sooo eager to not pay taxes here in the US.

Because the money is not spread equally among all people. I'm in the middle class and tax increases rarely benefit us.

There are a never ending supply of loopholes for the rich and free handout programs for the poor. 50% of people in the US are considered "too poor" to pay taxes so they are essentially waived from paying certain taxes. That means somebody else needs to pay to make up for what they're not contributing and that's mostly the middle class.

ThomasAmby · « **Reply #21 on:** December 12, 2010, 08:43 »

I'm curious to know how much the average American citizen pays in taxes? Just an approximation. My guess would be around 20% but I honestly have no clue.
Here in Denmark most of us pays just about 45% but it goes up to 60%+, depending on how much money you earn. Several deductions make it difficult to calculate the effective rate though. Way too much nevertheless.

reckless · « **Reply #22 on:** December 12, 2010, 09:06 »

Slow boring Sunday...Maybe we can just bash them Americans again.

cclapper · « **Reply #23 on:** December 12, 2010, 09:52 »

Quote from: ThomasAmby on December 12, 2010, 08:43

I'm curious to know how much the average American citizen pays in taxes? Just an approximation. My guess would be around 20% but I honestly have no clue.
Here in Denmark most of us pays just about 45% but it goes up to 60%+, depending on how much money you earn. Several deductions make it difficult to calculate the effective rate though. Way too much nevertheless.

I think the average American joe in the working class pays about 28-30%. Lower income people pay around 15%. I'm not certain what upper class folks pay...never had the luxury of finding out!

gaja · « **Reply #24 on:** December 12, 2010, 10:40 »

Quote from: cclapper on December 12, 2010, 09:52

Quote from: ThomasAmby on December 12, 2010, 08:43
I'm curious to know how much the average American citizen pays in taxes? Just an approximation. My guess would be around 20% but I honestly have no clue.
Here in Denmark most of us pays just about 45% but it goes up to 60%+, depending on how much money you earn. Several deductions make it difficult to calculate the effective rate though. Way too much nevertheless.

I think the average American joe in the working class pays about 28-30%. Lower income people pay around 15%. I'm not certain what upper class folks pay...never had the luxury of finding out!

According to Eurostat the average in Denmark is 48 %. Norwegians pay about 42% on average, and I have absolutely no problem with that. Health care is free, schools are free (including universities), we have more than one year maternety/paternety leave with full pay, and noone starves. Sure there are loads of issues with all kinds of things, and it is hard getting really filthy rich, but it is also difficult to get really poor. To me, that's a good trade off.

The right wing people in my home town recently refused to increase the local taxes with 0,001% ($30 per person). Because of that, the kindergartens will have to fire 2 persons next year. I would much rather pay 30 bucks more, to make sure the kindergartens keep up the good quality.