Should Both Pain-Ballers & 1/2-Ballers Oppose Biden-Harris Tax Plan?

Should Pain MD's Oppose Biden-Harris Tax Plan?

  • Yes, it's a greedy plan...

    Votes: 21 67.7%
  • No, I like giving my money to faceless, bureaucracies to spend any way they choose...

    Votes: 10 32.3%

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Details of Biden Tax Plan
Biden’s plan includes the following payroll tax, individual income tax, and estate and gift tax changes:

  • Imposes a 12.4 percent Old-Age, Survivors, and Disability Insurance (Social Security) payroll tax on income earned above $400,000, evenly split between employers and employees. This would create a “donut hole” in the current Social Security payroll tax, where wages between $137,700, the current wage cap, and $400,000 are not taxed.[1]
  • Reverts the top individual income tax rate for taxable incomes above $400,000 from 37 percent under current law to the pre-Tax Cuts and Jobs Act level of 39.6 percent.
  • Taxes long-term capital gains and qualified dividends at the ordinary income tax rate of 39.6 percent on income above $1 million and eliminates step-up in basis for capital gains taxation.[2]
  • Caps the tax benefit of itemized deductions to 28 percent of value for those earning more than $400,000, which means that taxpayers earning above that income threshold with tax rates higher than 28 percent would face limited itemized deductions.
  • Restores the Pease limitation on itemized deductions for taxable incomes above $400,000.
  • Phases out the qualified business income deduction (Section 199A) for filers with taxable income above $400,000.
  • Expands the Earned Income Tax Credit (EITC) for childless workers aged 65+; provides renewable-energy-related tax credits to individuals.
  • Expands the Child and Dependent Care Tax Credit (CDCTC) from a maximum of $3,000 in qualified expenses to $8,000 ($16,000 for multiple dependents) and increases the maximum reimbursement rate from 35 percent to 50 percent.
  • For 2021 and as long as economic conditions require, increases the Child Tax Credit (CTC) from a maximum value of $2,000 to $3,000 for children 17 or younger, while providing a $600 bonus credit for children under 6. The CTC would also be made fully refundable, removing the $2,500 reimbursement threshold and 15 percent phase-in rate.[3]
  • Reestablishes the First-Time Homebuyers’ Tax Credit, which was originally created during the Great Recession to help the housing market. Biden’s homebuyers’ credit would provide up to $15,000 for first-time homebuyers.[4]
  • Expands the estate and gift tax by restoring the rate and exemption to 2009 levels.
Biden’s plan also includes the following proposed business tax changes:

  • Increases the corporate income tax rate from 21 percent to 28 percent.[5]
  • Creates a minimum tax on corporations with book profits of $100 million or higher. The minimum tax is structured as an alternative minimum tax—corporations will pay the greater of their regular corporate income tax or the 15 percent minimum tax while still allowing for net operating loss (NOL) and foreign tax credits.[6]
  • Doubles the tax rate on Global Intangible Low Tax Income (GILTI) earned by foreign subsidiaries of US firms from 10.5 percent to 21 percent.
  • In addition to doubling the tax rate assessed on GILTI, Biden proposes to assess GILTI on a country-by-country basis and eliminate GILTI’s exemption for deemed returns under 10 percent of qualified business asset investment (QBAI).[7]
  • Establishes a Manufacturing Communities Tax Credit to reduce the tax liability of businesses that experience workforce layoffs or a major government institution closure
  • Expands the New Markets Tax Credit and makes it permanent.
  • Offers tax credits to small business for adopting workplace retirement savings plans.
  • Expands several renewable-energy-related tax credits, including tax credits for carbon capture, use, and storage as well as credits for residential energy efficiency, and a restoration of the Energy Investment Tax Credit (ITC) and the Electric Vehicle Tax Credit. The Biden plan would also end tax subsidies for fossil fuels.
Other proposals not modeled due to a lack of detailed information include:

  • Imposing a new 10 percent surtax on corporations that “offshore manufacturing and service jobs to foreign nations in order to sell goods or provide services back to the American market.”[8] This surtax would raise the effective corporate tax rate on this activity up to 30.8 percent.
  • Establishing an advanceable 10 percent “Made in America” tax credit for activities that restore production, revitalize existing closed or closing facilities, retool facilities to advance manufacturing employment, or expand manufacturing payroll.[9]
  • Equalizing the tax benefits of traditional retirement accounts (such as 401(k)s and individual retirement accounts) by providing a refundable tax credit in place of traditional deductibility.[10]
  • Eliminating certain real estate industry tax provisions.
  • Expanding the Affordable Care Act’s premium tax credit.
  • Creating a refundable renter’s tax credit capped at $5 billion per year, aimed at holding rent and utility payments at 30 percent of monthly income.
  • Increasing the generosity of the Low-Income Housing Tax Credit.
 

VA Hopeful Dr

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I'll be honest, while I don't love the idea of paying more in taxes, overall this isn't a drastic or unexpected move for a Democratic President. Let's be honest, even if they had a small majority in the Senate this wouldn't get passed exactly

But I HATE that SS doughnut hole idea. If the person making 60k has to pay SS taxes on their entire income, the person making 300k should too as opposed to really just giving the finger to the high earners. If you have to raise more money for SS, just up the cap from the current 120k-ish to something like 175k. Heck, I'd object less to a progressive SS tax compared to this BS.
 
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Mad Jack

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The capital gains taxes are a real problem, as it seriously disincentivizes investing by the wealthy. You're putting your money at risk to invest, and the advantage of that was if you invested in the long term you were rewarded with reduced taxes in exchange for your risk. Otherwise the plan seems reasonable, tax rates are too low and they are creating unsustainable deficits.
 
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//
  • Expands the estate and gift tax by restoring the rate and exemption to 2009 levels.
// This and raising corporate taxes are bad news. Rest is fine.
 

Laryngospasm

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The biggest issue here is the continued expansion of taxes. It will never stop. I also hate how politicians love to target high earners and call them rich. While the true rich continue to avoid taxes. If any of you think that the truly rich won’t somehow find a way out of paying you are crazy. It’s the earners who truly have no deductions that really pay the majority of taxes while the truly rich sit back in a corner and laugh. It’s class warfare. Keep people divided and target the high earners to placate the poor. I have yet to see a rich politician offer to give up their money but they will damn sure make sure you can’t accumulate any.
 
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BobBarker

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Guarantee that they will repeal the SALT $10k limitation. It penalized CA and NY disproportionately. Oklahoma is pretty bad too with moderate property taxes and income taxes. I didn’t benefit from the tax changes due to this.
 
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bedrock

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I don't think the Senate will allow a single one of these changes to occur.

You really need single party rule to enact tax law changes imo.

exactly. no way will the republican senate allow crazy far left laws to be passed.

Even if it was 50/50 in the Seante, there are some reasonable moderate democratic senators that would block crazy socialist legislation from AOC and the rest of the squad.
 
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ragnathor

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These are rather modest changes. Maybe it's because I'm not even a half-baller, but this maybe drops my monthly saving from 30 to 25% with zero changes in quality of life. I agree in general with a lower corporate income tax rate but higher individual (especially higher brackets).

More important to me is what would be done with that increased tax revenue - I doubt it would be paying down the debt.

@Laryngospasm nailed it that this does not have much effect on the ultrawealthy. This would require more tax brackets for higher incomes, change in short and long term capital gains, estate tax, etc.
 
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Ducttape

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this would actually help my income.

im not a baller, and wont get hurt by these changes where I got hurt by the trump changes, almost as if personally targeted by him...
 
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The capital gains taxes are a real problem, as it seriously disincentivizes investing by the wealthy. You're putting your money at risk to invest, and the advantage of that was if you invested in the long term you were rewarded with reduced taxes in exchange for your risk. Otherwise the plan seems reasonable, tax rates are too low and they are creating unsustainable deficits.

what is the alternative to investing? You think the wealthy are going to put their cash under their bed and earn 0 percent returns?
 

Mad Jack

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what is the alternative to investing? You think the wealthy are going to put their cash under their bed and earn 0 percent returns?
It disincentivizes the sort of investing that actually helps new companies build, not to broad market investing. If you are putting a few million into a new company, the tax increase functionally reduces your profits by over 25%, which when coupled with the inherent risk in investing in venture projects easily tilts the balance away from engaging in such ventures. It'll be very destructive to venture capital markets and likely cut investing in new companies by 50% or more, as it raises the bar for profitability substantially since only around 15% of your ventures will profit and you'll be taxed a rate of 40%
 
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Mad Jack

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The biggest issue here is the continued expansion of taxes. It will never stop. I also hate how politicians love to target high earners and call them rich. While the true rich continue to avoid taxes. If any of you think that the truly rich won’t somehow find a way out of paying you are crazy. It’s the earners who truly have no deductions that really pay the majority of taxes while the truly rich sit back in a corner and laugh. It’s class warfare. Keep people divided and target the high earners to placate the poor. I have yet to see a rich politician offer to give up their money but they will damn sure make sure you can’t accumulate any.
This isn't necessarily true. Top marginal tax rates were over 90% in the post-WWII era and declined as the deficit retracted. We should increase taxes, pay down the deficit, then decrease taxes as was done before
 

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Two tables will show how EVERYONE will pay under Biden's Tax Plan.

The US spends more money on Health, Education and military than any other country in the world. Does the US not have enough revenue?


Plan Highlights
Repeal the TCJA components for high-income filers
Impose 12.4% Social Security payroll tax for wages above $400k
Increase the corporate income tax to 28%
Establish a corporate minimum tax on book income
Double the tax rate on GILTI and impose it country-by-country
Temporarily increase the generosity of the Child Tax Credit and Dependent Credit
Conventional Revenue, 2021-2030 (Billions of Dollars)$3,334
Dynamic Revenue, 2021-2030 (Billions of Dollars)$2,782
Gross Domestic Product (GDP)-1.62%
Capital Stock-3.75%
Full-time Equivalent Jobs-542,000

Estimated Distributional Effect of Biden’s Tax Plan
Income GroupConventional, 2021Conventional, 2030Dynamic, long-run
0% to 20%10.8%-0.2%-1.2%
20% to 40%3.6%-0.2%-1.2%
40% to 60%1.4%-0.3%-1.3%
60% to 80%0.6%-0.5%-1.4%
80% to 100%-3.9%-3.0%-3.8%
80% to 90%0.1%-0.6%-1.5%
90% to 95%-0.2%-0.7%-1.6%
95% to 99%-1.3%-1.1%-2.1%
99% to 100%-11.3%-7.7%-8.9%
TOTAL-1.2%-1.9%-2.8%
Source: Tax Foundation General Equilibrium Model, October 2020.

Source
 

Laryngospasm

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You're not supposed to admit that your goal is to hurt the ultra wealthy...
It’s not so much wanting to hurt the ultra wealthy as being used as a pawn in their game. There are many wealthy who pay minimal to no taxes. While an earner making 600k will pay very heavily especially when you factor in property tax
This isn't necessarily true. Top marginal tax rates were over 90% in the post-WWII era and declined as the deficit retracted. We should increase taxes, pay down the deficit, then decrease taxes as was done before

and there were so many loopholes that no one paid those rates. The rich will continue to not pay. The point is you will never be able to get ahead. Those who have tons of money will stay ahead and the poor will think they have punished the rich and will continue up to vote for more socialist policies. The elite will accomplish the division while keeping what they have which has always been their goal. And maybe we should stop looking at continually increasing taxes as a way to make up for poor fiscal policy. Otherwise I think it’s pretty obvious it’s not sustainable.
 
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Mad Jack

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It’s not so much wanting to hurt the ultra wealthy as being used as a pawn in their game. There are many wealthy who pay minimal to no taxes. While an earner making 600k will pay very heavily especially when you factor in property tax


and there were so many loopholes that no one paid those rates. The rich will continue to not pay. The point is you will never be able to get ahead. Those who have tons of money will stay ahead and the poor will think they have punished the rich and will continue up to vote for more socialist policies. The elite will accomplish the division while keeping what they have which has always been their goal. And maybe we should stop looking at continually increasing taxes as a way to make up for poor fiscal policy. Otherwise I think it’s pretty obvious it’s not sustainable.
It is imppssible to pay down the deficit at current levels without tax increases. Any reasonable person should want an increass in revenues if you want the budget to someday be sustainable.
 
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Ducttape

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Elections have consequences. If you don't like the current policies, vote for change.
I did.
It is imppssible to pay down the deficit at current levels without tax increases. Any reasonable person should want an increass in revenues if you want the budget to someday be sustainable.
unless you believe in voodoo economics.
 

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It is imppssible to pay down the deficit at current levels without tax increases. Any reasonable person should want an increass in revenues if you want the budget to someday be sustainable.

Not true. 1/2 of the federal budget is wasted. The budget can be balanced without tax increases.

There is incalculable waste in state and federal governments. In California, state employed retired lifeguards get a 300K/year pension and retired sheriffs get 400k pensions.

There is so much fat and waste to be pared from government budgets.
 
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SSdoc33

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Not true. 1/2 of the federal budget is wasted. The budget can be balanced without tax increases.

There is incalculable waste in state and federal governments. In California, state employed retired lifeguards get a 300K/year pension and retired sheriffs get 400k pensions.

There is so much fat and waste to be pared from government budgets.

D.O.D.
 
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These are rather modest changes. Maybe it's because I'm not even a half-baller, but this maybe drops my monthly saving from 30 to 25% with zero changes in quality of life. I agree in general with a lower corporate income tax rate but higher individual (especially higher brackets).

More important to me is what would be done with that increased tax revenue - I doubt it would be paying down the debt.

@Laryngospasm nailed it that this does not have much effect on the ultrawealthy. This would require more tax brackets for higher incomes, change in short and long term capital gains, estate tax, etc.
It is imppssible to pay down the deficit at current levels without tax increases. Any reasonable person should want an increass in revenues if you want the budget to someday be sustainable.
Honestly, as a conservative, I don't mind taxes to support basic government things such as police, fire, roads, military, safety net, etc. But I have yet to see where ANY government uses the money responsibly. That's my beef.

I really hate it when democrats start spending my money because they NEVER want to pay down debt and usually throw the money at things I object to.
 
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SSdoc33

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Honestly, as a conservative, I don't mind taxes to support basic government things such as police, fire, roads, military, safety net, etc. But I have yet to see where ANY government uses the money responsibly. That's my beef.

I really hate it when democrats start spending my money because they NEVER want to pay down debt and usually throw the money at things I object to.

i would argue that this USED to be the case. in the last few decades, the democrats have been the fiscally responsible ones. it really just comes down to a matter of HOW you want the government to spend (waste) your money.

IMHO, we arent that far off from where we should be from a revenue perspective. maybe a slight increase in capital gains taxes and a higher rate for the uber-rich. possibly a slight increase in the corporate rate.

if you were king of the US, where would you save money in terms of spending?
 

Ducttape

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Honestly, as a conservative, I don't mind taxes to support basic government things such as police, fire, roads, military, safety net, etc. But I have yet to see where ANY government uses the money responsibly. That's my beef.

I really hate it when democrats start spending my money because they NEVER want to pay down debt and usually throw the money at things I object to.

Generally speaking, since Reagan, the only 2 presidents to decrease the federal deficit were... Clinton and Obama.
 
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bedrock

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Generally speaking, since Reagan, the only 2 presidents to decrease the federal deficit were... Clinton and Obama.

Much of that Is a function of the economy. Taken out of context and it appears the Democrats don’t live to spend money on things. The Dot.com boom clouds things.

Real factor is who increases government spending the most. No party really reduces spending, but Democrats certainly spend more than Republicans, though both spend more than I would like.
 

SSdoc33

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Much of that Is a function of the economy. Taken out of context and it appears the Democrats don’t live to spend money on things. The Dot.com boom clouds things.

Real factor is who increases government spending the most. No party really reduces spending, but Democrats certainly spend more than Republicans, though both spend more than I would like.

right, so, clinton and obama fixed the economy, GHWB, GWB, and DJT all destroyed it. isnt it a bit peculiar that all three just happened to leave office in the midst of a recession? if you have a booming economy, you can spend more AND pay down the debt. DJT had a great economy for most of his tenure but did not pay down the debt.
 
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right, so, clinton and obama fixed the economy, GHWB, GWB, and DJT all destroyed it. isnt it a bit peculiar that all three just happened to leave office in the midst of a recession?
No, it's not peculiar at all.

It's absurdly simplistic to believe the president currently in office has total control of the economy. Ridiculous.

You're better than this.
 
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bedrock

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right, so, clinton and obama fixed the economy, GHWB, GWB, and DJT all destroyed it. isnt it a bit peculiar that all three just happened to leave office in the midst of a recession? if you have a booming economy, you can spend more AND pay down the debt. DJT had a great economy for most of his tenure but did not pay down the debt.

Right. A democratic administration is good for the economy

That’s why the stock market falls everytime a democratic administration is elected....because they are so good for the economy.
 

SSdoc33

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No, it's not peculiar at all.

It's absurdly simplistic to believe the president currently in office has total control of the economy. Ridiculous.

You're better than this.
President doesnt control the markets. But, they can decide tax policy and deficit spending. GOP has exploded the deficit
 

SSdoc33

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Right. A democratic administration is good for the economy

That’s why the stock market falls everytime a democratic administration is elected....because they are so good for the economy.
What happened when biden got elected?
 

Ducttape

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Much of that Is a function of the economy. Taken out of context and it appears the Democrats don’t live to spend money on things. The Dot.com boom clouds things.

Real factor is who increases government spending the most. No party really reduces spending, but Democrats certainly spend more than Republicans, though both spend more than I would like.
actually, that is not entirely true. democrat presidents don't necessarily spend more than Republicans.

in fact, in terms of federal spending with respect to GDP, since WWII, the average federal spending as a % of GDP is slightly higher under republican presidents.


but... all presidents have increased spending, regardless of politics.

in fact, this graph is very telling:

fed spending.GIF

note the major blip in 2008-2009 - dont blame Obama, because the raise was Bush's... even then, from a percentage wise, it was not that large...
 

Ducttape

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Right. A democratic administration is good for the economy

That’s why the stock market falls everytime a democratic administration is elected....because they are so good for the economy.
this is also not true.


stock market.GIF

S&P have gone up most during Clinton and Obama.

trump unfortunately has been cursed with coronavirus.

remember that forbes tends to right-center bias, so you cant blame MSM and fake news.
 

Ferrismonk

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Generally speaking, since Reagan, the only 2 presidents to decrease the federal deficit were... Clinton and Obama.
I give the credit of a balanced budget not to Clinton, but to Gingrich. Clinton fought that tooth and nail.

The deficit and national debt ballooned under Obama. The reason the charts above look reasonable well for him is because they don't look at national debt and the deficit balance is skewed because the ACA collected taxes for a few years before the spending increased to make the ACA look somewhat palatable.

I agree that Bush Jr. (Medicare prescription drugs and Iraq war) and Trump (infrastructure and lower taxes) are by no means fiscal hawks. Trump at least made the best American economy ever before COVID hit.
 
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