Our financial system is crumbling this week.

[heyzeus]

Dow's up over 200 points already today. All of our problems are solved!

[Hungary Jack]

If we tax the top 1% of incomes at 100%, we can raise over $900 billion.

[Hungary Jack]

Top marginal rate should be 35% at most, preferably a bit less. Add state taxes to that and in some cases you are getting scarily close to 50%, which is pretty outrageous.

Tax corporate profits at 25% and get rid of all the dam loopholes and subsidies: oil, sugar, corn, etc.

Keep taxes low on long-term capital gains. Tax short term gains as income.

[JCShutout]

How about something like this:

Between $0 and $5k/year 0%
Between $5k and $15k/year 3%
Between $15k and $30k/year 6%
Between $30k and $60k/year 9%
Between $60k and $120k/year 12%
Between $120k and $250k/year 15%
Between $250k and $500k/year 18%
Between $500k and $1m/year 21%
Between 1m and 5m/year 25%
Between 5m and 25m/year 30%
Above 25m/year 35%

No loopholes, no nothing. You make it, you pay it.

And I'll go with HJ's no loophole 25% corporate profits and pop's don't blow [expletive] up budget strategy.

[greenback44]

Keep taxes low on long-term capital gains.

This one bothers me on three fronts. First, it's the means for a lot of income tax manipulation. Second, I've read a few too many libertarian blogs about the evils of using tax policy as a carrot (or a stick) to guide behavior. And third, I don't understand why gains from capital should be taxed less than gains from ordinary work. Yes, I've heard the line about encouraging investment, but (a) people are not going to stick their money under a mattress because of a 10% change in taxes on gains and (b) the consequence is that you have to increase tax rates for ordinary income, which apparently means you're encouraging people not to work.

[cpebbles]

I don't understand why gains from capital should be taxed less than gains from ordinary work. Yes, I've heard the line about encouraging investment, but (a) people are not going to stick their money under a mattress because of a 10% change in taxes on gains and (b) the consequence is that you have to increase tax rates for ordinary income, which apparently means you're encouraging people not to work.

It's hard damned work being rich.

[Sutter'sBeard]

How about something like this:

Between $0 and $5k/year 0%
Between $5k and $15k/year 3%
Between $15k and $30k/year 6%
Between $30k and $60k/year 9%
Between $60k and $120k/year 12%
Between $120k and $250k/year 15%
Between $250k and $500k/year 18%
Between $500k and $1m/year 21%
Between 1m and 5m/year 25%
Between 5m and 25m/year 30%
Above 25m/year 35%

No loopholes, no nothing. You make it, you pay it.

And I'll go with HJ's no loophole 25% corporate profits and pop's don't blow [expletive] up budget strategy.

I think a loophole free tax sounds like a damn good idea but wouldn't it pretty much kill the entire tax accounting industry? I'm not sure of the number of business and that would close and workers that would unemploy but I'm guessing it would be substantial.

[JackofDiamonds]

One of your big loopholes JC is the charitable contributions deduction... there's not as much charitable intent out there as there is intent to lower tax liability.

[merlin]

Hate to be Debbie Downer, but the tax problem is a little more complicated than changing the rates and then saying we're going to close the "loopholes." What consitutes a loophole? No matter what system is in place, there are going to be people and corporations trying to find ways to pay fewer taxes (and 90% of them would be perfectly legal and within the rules). For every loophole that you think you're closing, there will be a creative mind out there thinking of a new way to get around it that will be perfectly legal within the new rules.

Charitable contributions are not a tax loophole. You give $100 as a contribution. You get $20 of tax savings. You're still out net $80. No one is financially better off because of a charitable contribution deduction (except the charity itself). If you dislike that people are getting a tax benefit for something that they should be doing solely out of the goodness of their heart, that's fine, but it doesn't make it a tax loophole.

[JackofDiamonds]

Hate to be Debbie Downer, but the tax problem is a little more complicated than changing the rates and then saying we're going to close the "loopholes." What consitutes a loophole? No matter what system is in place, there are going to be people and corporations trying to find ways to pay fewer taxes (and 90% of them would be perfectly legal and within the rules). For every loophole that you think you're closing, there will be a creative mind out there thinking of a new way to get around it that will be perfectly legal within the new rules.

Charitable contributions are not a tax loophole. You give $100 as a contribution. You get $20 of tax savings. You're still out net $80. No one is financially better off because of a charitable contribution deduction (except the charity itself). If you dislike that people are getting a tax benefit for something that they should be doing solely out of the goodness of their heart, that's fine, but it doesn't make it a tax loophole.

A) That was my point. Calling anything that reduces taxes a loophole is wrongheaded.
B) The higher your tax bracket, the higher your savings. I know several of our clients would contribute tens/hundreds of thousands less if they didn't receive the deduction.