Tea Party Aftermath

Among the comments made about the Tea patry protesters, were comments that the protesters were forgetting that the Obama Administration's stimulus package contained tax cuts for 95% of Americans. 

I did a Google search and this was the first one to come up:

Wage earners and the self-employed are eligible for up to $400 a year for single taxpayers and up to $800 for couples filing jointly in both 2009 and 2010. If you are single, the credit starts to phase out at an adjusted gross income of $75,000. If you are part of a couple filing jointly, your phaseout would begin at $150,000 of adjusted gross income. You’re probably wondering when the check will arrive. It won’t. The IRS will begin reducing withholding taxes automatically at the clip of about $30-$40 a month. If you are self-employed, you can claim your credit when you file your return for 2009.

I don't know about you, but $400 a year isn't going to break me or make me. I appreciate the effort, and like everyone else could use and additional $400, but this doesn't impress me. It's a start, but not nearly enough to really help anyone. Under the FairTax, I'll get that much (and more) each and every payday. 

I did the math for my other reader (wonderful person, but not so good on the math) and here are the results. If you are single, that $400 breaks down this way (double if you are married):

weekly: $7.70

bi-weekly: $15.39

monthly: $33.33

Wow....$7.70 a week. That's three gallons of gas, if the prices stay down. You can't have dinner out on that unless you go to Mickey D's, and that's if you leave the kids at home. I can't pay any bills, I can buy groceries for a couple of meals, if I shop carefully. Clothing? Goodwill, here I come. I don't think I can buy clothing at Walmart for $7.70. This tax reduction might pay the tax increase on cigarettes. I'm not sure, I don't smoke so I haven't been following that issue. 

And remember, since you are having less money taken out of your paycheck, your tax return next year will be less.

Now, look at your paystub. See where it lists withholding (FICA Reg, FICA Med, and FIT W/H). Those are your Federal taxes. There may be state taxes where you live; the Fair Tax won't apply unless your state adopts it, and I think all states will if the Feds finally see the way. Look at total taxes. That's how much (less insurance, and state and other taxes and deductions) that Uncle Sam takes from the money you earned.

I have no probably paying for services only the Federal government can, and is authorized by the Constitution, to perform (national defense being foremost). I object to the Feds using my tax money to subsidize programs that are best served by private groups or the states (I also object to states subsidizing programs that are best served by private groups). 

Four hundred dollars a year against $490 a paycheck? And a reduced return next year? No, I'll take the FairTax reducing the withholding to zero. I'll also reduce my tax refund to zero because I won't have to file a return! 

What a win-win situation.