2018: Feds Collect Record Individual Taxes

The OP specifically mentioned individual income tax not total revenue.

That's gonna leave a mark.

 

Your second sentence pretty much tells it all. Do you understand 'tax brackets', and how the percentage of tax withheld changes when you change tax brackets?

I decline to give the government more than my estimated tax liability for any given year. They wouldn't give me an interest free loan, I see no need to give them one. Personally, I feel it is foolish to be excessively over withheld, there is no purpose, since one can open a savings account and collect interest.

 

Lot of assumptions there? One reason I over-withhold is to have dry powder to pay taxes on dividends and capital gains. Those, I cannot withhold during the year. Second, I'd rather give the government an interest-free loan (in my case about $20 in interest for a savings account), than overspend during the year and owe taxes in April. From a behavioral finance point of view, this is actually the strategy that works best for most people. Most people are not disciplined enough to put the additional monthly money into a savings account, but it is much easier to put 30% of your refund into a savings account. What I don't see in my paycheck I can't spend. View it as forced savings.

 

If you are having more withheld from you paycheck to cover other income, that is not over withholding, that is paying taxes due on additional income. Over withholding is when you either claim o dependents, when you will file 3 on your taxes, or that little line #6, and have the employer take more out, so you get it back as a lump at tax time.

Most 21st century employers use direct deposit, which eliminates all those issues of not being able to save a time and spending every dime you get. But, I guess your employer is one of those small businesses that still hand calculates payroll taxes, and delivers handwritten paper checks.

For financial behavior, it does not speak well of the person doing it, if they cannot resist to spend every dime they receive.

 

I work for a large research university. Of course, they provide W4 forms for employees. I just chose to have 0 dependents on the form, when in reality I have 2.

Second, maybe you feel good pontificating about prudent financial behavior, the reality is that Americans just are unable to save. That's why we have an average savings rate of 2.4% and dropping. The same thing holds for companies as well. Corporate debt is at record $9 trillion levels, I guess you have to spend money in order to make money. So, are all these companies who are in debt up to their eyeballs financially incompetent?

For myself, I have a 30% personal savings rate and feel pretty confident about retirement. I realize, however, that I am privileged and not everyone is in the position to save as much.

 

As I said before, you have multiple forms of income, and it's not a matter of excess withholding, but to pay the taxes that are due on that income. I would have to doubt that a 'large research University' doesn't have direct deposit, but your choice to do as you will. I don't feel it's wise to do so, but it's your buck.

Personally, I pay in the minimum, and make sure I owe at the end of it all. I have better things to do with my money than loan it to the government. I have direct deposit, and it splits up my deposit between my savings and my checking. I also earn interest on both accounts. My savings ratio is way above average, probably like 50%, since my expenses are relatively low.

There is a separation between debt for expansion of production, and debt because one can't pay their bills. Two very different birds. Many companies can and do over leverage their assets, but if the additional assets being purchased can return production more than the debt over a given span of time (depending on the interest rate and length of loan) and the EBIDTA is on solid ground, then certain debt loads are not a problem.

 

We have only hit 2.5% inflation, one time, in the last 8 years.

We reached 0.8% population growth 1 time in the last 10 years.

Holy crap. "Real" means "inflation adjusted" and you just posted 3-3.3% as inflation adjusted growth based on your erroneous claim that inflation runs 2.5% a year, which is another false statistic.

During the back to back reigns of Dumb and Dumber, maybe.

Dumb only hit 3% or better 3 years out of 8.
Dumber went zero for 8. He never hit 3%
Bill the Zipper hit 3% or better 6 out of 8 times.
Bush the Papa, 1 for 4.
Reagan 5-8
Even Carter hit 3% or better 2 out of 4 years.

If we were satisfied with 5.6% revenue growth we might end recessions. But as you can see, we never are, and when it breaches 10% it falls, sometimes violently.

I just have no idea where you come up with your numbers. We have reached or exceeded 12.4% in revenue growth exactly two years in the last 26 and both were followed by revenue crashes, some that lasted several years.

You can point no recent period were we have been able to sustain the government taking that level of revenue from the economy with a crash in revenues resulting.

More horseshit. Only the top 9 percent of households would benefit from repeal of the $10,000 cap on the state and local property tax (SALT) deduction, and more than 96%of the tax cut would go to the highest-income 20% of households, according to a new analysis by the Tax Policy Center. The top 1% of households, those making $755,000 or more, would receive more than 56% of the tax cut.

Show me the Liberal that predicted that Trump's real GDP would average 3% over his first full six quarters.

 

But you do remember I expect Trump's claim he was going to hit 5% real GDP growth. That said of course massive tax cuts would have a bump in GDP at the expense of the deficit. Didn't last long though did it.

 

Well, he just hit 3.1%, his first full year, the best annual GDP growth in twelve years.


To hit 5%, Trump is going to have to make great improvement in the massive trade deficit he inherited from Obama, and he is certainly working on it!

While corrupt Obama was president, the Congressional Budget Office (CBO) forecast in 2016 that America would never see 3.0% economic growth again. They had given up and Hillary was their candidate.

Barack Obama was the first President ever to never surpass an annual rate of 3% GDP growth.

Trump rang this bell in his first full year. It's good to finally have a real president again, one that works FOR the American People.

 

Q2 2018: GDP growth 4.2%
Q4 2018: GDP growth 2.6%

There is no data showing that Q1 2019 will be any better than Q2 2018.

So, Trump bought himself ONE QUARTER of >4% GDP growth at the expense of $1 trillion + deficits into the future as far as the eye can see. That must be some miracle work.

He is just another run of the mill tax less and spend more Republican. We have seen these types before.

 

He only works for the American people if you only think the rich are Americans.

 

Q2 2016 GDP growth 2.3%
Q4 2016 GDP growth 1.8%

Much improved over Obama's closing year and we like it!

As long as he can beat Obama's Q4 2015 number of 0.4%, that's the key!

Trump's First 7 full quarters have averaged 2.93%
Obama's final 7 full quarters averaged 1.74%, so, Trump's growth is 68% higher than Obama's.

Trump's been President for 770 days and over that period he's run up 9% more debt than Obama did in his final 770 days. So, yes, the Federal debt's up 9% but GDP's up 68%. That's the secret, Trump has to keep growing the economy faster than the federal debt.

It's not really a "miracle" it's just freeing the human spirit and helping Americans improve their own lives. Like JFK said, the rising tide lifts all boats!

He's off to one hell of a start!

 

You mean, he lowered the taxes to get more jobs.
And in order to achieve that, he had to borrow a kewl trillion bucks.
I like to see a source how and when he is going to repay the money.

 

Debt growth levels are up 9% for Trump, compared to Obama, but, GDP levels are up 68%, so we are finally growing our economy faster than our debt.

 

So, the human spirit in the US was not free under Obama?

As I said, though, the short-term economic expansion is just bought by unpaid-for tax cuts -- essentially putting GDP growth on the credit card. This effect is already wearing off, as it always did in the past. At the end, we'll be left with trillions more in public debt and a yuge recession. Of course, you'll blame the Dems for it when that happens.

 

I thought liberals wanted to raise taxes on high income earners?

 

Why? Corporations dont pay taxes. Their customers do.

I think you need to be reminded that "the little guy", or bottom 30% of tax paying adults, dont actually have ANY federal income tax liability.

So in reality, they benefit for something that dont fund at all.

 

It's the excellent economies fault people are irresponsible bums?

Wtf?

 

Excessive regulation strangles the human spirit. Freeing the human spirit breeds prosperity.

Well, debt growth levels are up under Trump, by 9%, but, GDP growth is up 68%. Finally, we are growing GDP faster than debt, and that's the key. Trump finally has us moving in the right direction again.


When you going in the WRONG direction, like we were under Obama, time is your enemy.
When we are going in the RIGHT direction, like we are under Trump, time is our friend.

Recession? What recession, don't confuse Bill Maher's fantasy with reality. GDP growth is up 68% under Trump, compared to Obama and the Fed has shed a $1/2T off it's balance sheet. The key now is reducing the massive Trade Deficit that Trump inherited from Bush and Obama, progress on that will really drive GDP. The Trade Deficit is a straight subtraction from GDP.

Oh, you seem defensive. Just enjoy the economic growth and be grateful, not every generation gets to enjoy the blessings of prosperity.

 

Oh look fun with numbers.

 

Well they claim that, but it seems to be meaningless virtue signalling. Trump raised taxes on the top 9% of earners, and their whining and bitching about it seems rather endless.

 

Trump could enact their entire agenda and they'd still whine. It's what liberals do. I think this tax policy was great, why should the rest of America subsidize a handful of big spending blue states?

 

Of course, as usual, you cherry pick data and use comparisons of non-comparable variables to make your hero look good. You know, that's dishonest.

You cannot compare growth of TOTAL debt (a state variable) with growth of GROWTH of GDP (a flow variable). The more honest comparison would be growth of the deficit (a flow variable) with growth GDP growth (a flow variable). Of course, since the deficit exploded since Trump, those numbers would not make him look good, so you avoid them.

Note in edit: Regarding prosperity: I don't want your desire for instant gratification ruin my children's life. Your current "prosperity" through reckless tax cuts may interfere with their prosperity years down the road, when the inevitable recession hits.

 

68%? The hell it is. lol
https://tradingeconomics.com/united-states/gdp-growth

And I'm still waiting for that source how and when that debt is going to be repaid.

 

That's quite correct.

Obama's final 7 full quarters averaged 1.74%
Trump's first full seven quarters averaged 2.93%

Trump's GDP growth rate is up by 68% over Obama's. That's what we call a Damn Fine Start!