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I am Ram

Tax reform

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Let's assume you are married filing jointly with two children who are over 18 but less than 24 in college and you just take the standard deduction.  I believe you would be better off under the current system of a standard deduction and 4 personal exemptions...no?

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4 hours ago, Old_SD_Dude said:

I'm screwed if this goes through. I go down 2% in the federal brackets but I can no longer deduct the 9.3% I pay in state income tax.

That's good the rest of the country needs to stop the welfare to California, New York, Massachusetts and the rest of the richest states in the country.

I also see no point in the government encouraging birth rates any more in a country with far more than 300 million people and massive immigration pressure.  Immigrants are better for the economy and more innovative.   Rather have them than the spoiled brats we raise.

The home mortgage deduction is also a deduction without a reason.    

 

If you are going to simplify taxes and lower rates you have to kill all the special interests.

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2 hours ago, Akkula said:

Let's assume you are married filing jointly with two children who are over 18 but less than 24 in college and you just take the standard deduction.  I believe you would be better off under the current system of a standard deduction and 4 personal exemptions...no?

Depends on how much money you make.  Most American in that situation currently pay nothing in income tax.  Can't get better than nothing.

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One of the worst things in the plan that I saw was it eliminated the adoption tax credit. That's pretty bad and it can't be a huge amount of money it saves relatively. Adoption is very expensive and a lot of families wouldn't be able to afford it without the credit. This will probably lead to fewer adoption meaning more kids in foster care which I would think would cost the government more money than the tax credit did.

 

I haven't dove deep but for me I may save some money but not sure.

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On 10/31/2017 at 4:28 PM, Mano said:

So, +++++ing over the middle class to reduce the top tax bracket and corporate.

No way! This legislation is going to benefit every income tax bracket! It's going to be the greatest tax reform plan in U.S. history!

Signed,

Everybody But Fox and Breitbart is Fake News and I Know That for a Fact Because I Get All My News From Them

Boom goes the dynamite.

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Can someone of you tax-savvy people help check this calculation, please?

Let's say my wife an I (filing jointly) have a gross annual income of $130,000. Oregon income tax is 9%. If we just take the standard deductions (for simplicity's sake), we'd be looking at $106,000, correct?

So...

90k taxed at 12% federal

16k taxed at 25% federal

plus

106k taxed at 9% state

That would be $24,340 in income taxes, so an effective tax rate of around 19%. Does this look correct?

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On 11/1/2017 at 11:01 AM, renoskier said:

So you know, I've made almost all of my wealth through real estate; IMO the mortgage interest deduction should be phased out. Home ownership is a good thing all on it's own. It doesn't need artificial stimulus from our government. I think it should be phased out over a 10-15 year period by starting at the top and annually reducing the maximum amount which can be deducted.

Do you think landlords should lose the mortgage and depreciation deductions?  I would think the depreciation deduction on real estate is a sham, with no basis in reality.  Using your own logic, "Home ownership is a good thing all on it's own. It doesn't need artificial stimulus from our government".

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On 11/2/2017 at 3:48 PM, Old_SD_Dude said:

I'm screwed if this goes through. I go down 2% in the federal brackets but I can no longer deduct the 9.3% I pay in state income tax.

What is the impact of the higher standard deduction?

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1 hour ago, modestobulldog said:

Do you think landlords should lose the mortgage and depreciation deductions?  I would think the depreciation deduction on real estate is a sham, with no basis in reality.  Using your own logic, "Home ownership is a good thing all on it's own. It doesn't need artificial stimulus from our government".

No. And owning investment property is not "home ownership".

Regarding the deduction of mortgage interest, it's treated differently than taking an interest deduction on your personal residence. It's treated as a business expense, which it is.

Depreciation is not a "sham". Like the assets of any business, a building has a finite utility and it's only the building, not the underlying land, which is depreciated. Also, depreciation doesn't eliminate tax liability, it simply defers it; recapture tax on depreciation is 25% when the property is eventually sold.

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On 11/2/2017 at 8:28 PM, Akkula said:

Let's assume you are married filing jointly with two children who are over 18 but less than 24 in college and you just take the standard deduction.  I believe you would be better off under the current system of a standard deduction and 4 personal exemptions...no?

Depends on the level of income. There is a $600 increase in the child tax credit (I assume still applies to college students). That $600 credit, if you are in the 12% bracket is equivalent to a $5,000 deduction. The 12% bracket goes up to $90k in taxable income or $114k AGI with the standard deduction.

The adjustments to the tax brackets yield a lot of savings too. Lots of moving parts.

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On 11/5/2017 at 10:32 AM, modestobulldog said:

Do you think landlords should lose the mortgage and depreciation deductions?  I would think the depreciation deduction on real estate is a sham, with no basis in reality.  Using your own logic, "Home ownership is a good thing all on it's own. It doesn't need artificial stimulus from our government".

Depreciation on real estate keeps rents lower. If we eliminated depreciation, taxes would increase for the landlords and they'd increase rents to cover it. Landlords don't work for free.

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On 11/3/2017 at 1:31 PM, I am Ram said:

Can someone of you tax-savvy people help check this calculation, please?

Let's say my wife an I (filing jointly) have a gross annual income of $130,000. Oregon income tax is 9%. If we just take the standard deductions (for simplicity's sake), we'd be looking at $106,000, correct?

So...

90k taxed at 12% federal

16k taxed at 25% federal

plus

106k taxed at 9% state

That would be $24,340 in income taxes, so an effective tax rate of around 19%. Does this look correct?

Pretty close. That assumes no state standard deduction (I'm unfamiliar with OR tax law) or state credits. You'd get a $300 family credit each at the federal level. So reduce federal tax by $600 which puts you at $23,740. I'm in a similar boat, but my state tax rate is only 6%.

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On 11/2/2017 at 8:10 PM, Akkula said:

Well...you know the Republicans would do that same line if Obama would have done it.  Hobby Lobby...religious freedom!  Seriously, though...it will impact folks with more kids negatively if you can't claim personal exemptions if you have a gaggle of kids.  Who has gaggles of kids?!?

Wrong. The child tax credit was increased by $600. In the 12% bracket (up to 90K taxable income) that is equivalent to a $5,000 deduction. The personal exemption in 2016 was $4,050. Trick... er... Trump loves the kids!

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