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My first reaction when reading your post was one of curiosity. I was an IC during the latter Clinton years and I do not recall paying 40% of my earnings to tax. What I remember was an aggregate tax payment composed of income tax, social security tax and self-employment tax, which essentially represented a burden I shouldered as an IC that compensated for the lack of employer contribution to SS, Medicare and FICA. To my knowledge, this tax structure has not changed since then for ICs. I also remember paying my taxes quarterly, and being responsible for calculating enough tax not only to cover my required amounts, but also to pay in extra each time if I wanted to generate a return at the end of the year. I made a decision NOT to be an independent contractor because I was a single parent with a mortgage. The self-employment levy felt like double tax to me as compared to what I had been accustomed to as an employee and, most definitely the total percentage of tax burden as an IC was greater than that of a full employee status.
On checking my returns from those years (which I still keep in the house) I find the total tax burden I had for all the components of my tax liability amounted to 27%. I am wondering if you did not get a return back then because you did not contribute more than the minimum rate during the course of the year and that later on, your contributions did allow you to have a return. Also, to account for the lower rate during Bush years, did your family situation change between Clinton years and Bush years, did you get married, have children, add an earned income tax credit deduction, add dependents, start itemizing your taxes. All these changes would account for a lower percentage rate of your tax liability, thus allowing for a return.
I am also wondering why you would look back instead of forward when assessing the issue of whether or not you will be "taxed more." Have you read Obama's tax plan? If not, please go to this link and take a look. http://www.barackobama.com/issues/economy/#tax-relief
Essentially this is what you will find (please excuse the format challenges of cut and paste).
Provide Middle Class Americans Tax Relief
Obama will cut income taxes by $1,000 for working families to offset the payroll tax they pay.
• Provide a Tax Cut for Working Families: Obama will restore fairness to the tax code and provide 150 million workers the tax relief they need. Obama will create a new "Making Work Pay" tax credit of up to $500 per person, or $1,000 per working family. The "Making Work Pay" tax credit will completely eliminate income taxes for 10 million Americans.
• Eliminate Income Taxes for Seniors Making Less than $50,000: Barack Obama will eliminate all income taxation of seniors making less than $50,000 per year. This proposal will eliminate income taxes for 7 million seniors and provide these seniors with an average savings of $1,400 each year. Under the Obama plan, 27 million American seniors will also not need to file an income tax return.
• Simplify Tax Filings for Middle Class Americans: Obama will dramatically simplify tax filings so that millions of Americans will be able to do their taxes in less than five minutes. Obama will ensure that the IRS uses the information it already gets from banks and employers to give taxpayers the option of pre-filled tax forms to verify, sign and return. Experts estimate that the Obama proposal will save Americans up to 200 million total hours of work and aggravation and up to $2 billion in tax preparer fees.
It also might be worthwhile to check out the plan on the economy here
http://www.barackobama.com/issues/economy/
Scroll down to At a Glance and browse the links of interest to you.
Here's the link for healthcare
http://www.barackobama.com/issues/healthcare/
Again, scroll down to At a Glance and select links of interest.
I have provided Obama website links because you expressed doubts about democratic policy. McCain's website also should have similar information available on these issues as well for your comparison. After reviewing the information (if you were not already familiar with it), ask yourself where the information is coming from that is making you fearful that your taxes will be raised. I would really be interested in any response you may feel inclined to post in this regard. On a personal note, I will not be trusting McCain with the economy or with handling my HARD EARNED tax money. I do NOT want one more single penny to be used to fund the war, bankroll Israel's apartheid and nuclear weapons arsenal, prop up our struggling corporations or trickle up into the pockets of the richest among us in the form of continued Bush tax cuts to the rich, which McCain has openly stated he will continue if elected. |
In reply to the concerns you raised. - see message
