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Old 07-06-2019, 03:05 AM
 
1,286 posts, read 686,065 times
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Quote:
Originally Posted by mathjak107 View Post
employment tax dollars don’t all buy the same amount of future benefit. Some of our employment tax dollars buy six times as much in benefits as others.

According to the Trustees Report, for instance, the first $767 of “average indexed monthly earnings” (a complex formula that adjusts earnings over time) is credited at a 90 percent rate, assuring the lowest wage workers of a retirement benefit nearly equal to their earned wage.

Wages of more than $767 a month but less than $4,624 a month are credited at a 32 percent rate. This means retirement benefits increase at a much lower rate. The benefit pinching, however, does not end there.

More means less

For wages of more than $4,624 a month up to the wage base maximum ($113,700 for 2013), the crediting rate is only 15 percent. Thus, all the wages earned — and employment taxes paid — over that $55,488-a-year “bend point” gain benefits at only one-sixth the rate of the lowest wage earners.

In effect, the Social Security benefits formula functions as a sharply graduated benefits “tax,” reducing the benefits that accrue to higher wages by 85 percent. The higher your means, the lower your benefit.
Mathjak107, you are discussing what happens if a person after they have survived more than 6 decades, (i.e. in excess of 60) years of their life. But many people don't live long enough to know that experience.

For many lower income persons, what occurs prior to their qualifying for Social Security retirement is over 60 years of financial desperation that was made more difficult for them and their families due to the most regressive of all federal taxes, the FICA payroll taxes levied upon their wages.

Wages usually are almost the entire incomes of our nation's lowest earners. It is more usual for a substantial portion of higher earner's incomes to be derived from sources that are not, rather than are subject to the FICA taxes upon their incomes. Wages are usually almost the entire earnings of laborers who are among the least earners of incomes.

FiCA taxes upon individual's earnings are the most regressive of all federal taxes.
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Old 07-06-2019, 03:09 AM
 
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Originally Posted by artillery77 View Post
Hey...I'm just copying the Nordic model. Everyone tells me it's the socialist rage.
Artillery77, your point is?
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Old 07-06-2019, 03:16 AM
 
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Quote:
Originally Posted by Supposn View Post
Mathjak107, you are discussing what happens if a person after they have survived more than 6 decades, (i.e. in excess of 60) years of their life. But many people don't live long enough to know that experience.

For many lower income persons, what occurs prior to their qualifying for Social Security retirement is over 60 years of financial desperation that was made more difficult for them and their families due to the most regressive of all federal taxes, the FICA payroll taxes levied upon their wages.

Wages usually are almost the entire incomes of our nation's lowest earners. It is more usual for a substantial portion of higher earner's incomes to be derived from sources that are not, rather than are subject to the FICA taxes upon their incomes. Wages are usually almost the entire earnings of laborers who are among the least earners of incomes.

FiCA taxes upon individual's earnings are the most regressive of all federal taxes.
social security is old age insurance , not an investment ..those who die pay for those who live just like any life annuity .. most of those you speak of if not all will find social security their only means of support if they live so those who live will need need it . either way we all buy this gov't annuity and keep our fingers crossed it is us who get to put in a claim .

you lost sight of what ss is for , it is an annuity /insurance for those WHO LIVE .
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Old 07-06-2019, 08:59 AM
 
2,139 posts, read 524,377 times
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Originally Posted by Supposn View Post
FiCA taxes upon individual's earnings are the most regressive of all federal taxes.
You keep saying that as if it were a bad thing.
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Old 07-06-2019, 10:12 AM
 
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Originally Posted by Supposn: FICA taxes upon individuals' earnings are the most regressive of all federal taxes.
Quote:
Originally Posted by RationalExpectations View Post
You keep saying that as if it were a bad thing.
RationalExpectations, you prefer we tax a greater portion of greater earners rather than lesser earners' annual incomes?
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Old 07-06-2019, 10:32 AM
 
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Quote:
Originally Posted by Supposn View Post
Originally Posted by Supposn: FICA taxes upon individuals' earnings are the most regressive of all federal taxes.
RationalExpectations, you prefer we tax a greater portion of greater earners rather than lesser earners' annual incomes?
Of course whatever level gets taxed more is above the level he is at ....always is
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Old 07-06-2019, 10:34 AM
 
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Quote:
Originally Posted by Supposn View Post
Originally Posted by Supposn: FICA taxes upon individuals' earnings are the most regressive of all federal taxes.
RationalExpectations, you prefer we tax a greater portion of greater earners rather than lesser earners' annual incomes?
Of whenever someone wants to tax those with more it never is at the level they are at ....
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Old 07-06-2019, 11:01 AM
 
1,286 posts, read 686,065 times
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Quote:
Originally Posted by mathjak107 View Post
social security is old age insurance , not an investment ..those who die pay for those who live just like any life annuity .. most of those you speak of if not all will find social security their only means of support if they live so those who live will need need it . either way we all buy this gov't annuity and keep our fingers crossed it is us who get to put in a claim .

you lost sight of what ss is for, it is an annuity /insurance for those WHO LIVE.
Mathjak107, to middle-income earners and possibly to you, it's generally considered as mandated annuity payment that's of some small expense. If and when you reach old age, you have some reasonable hope that you won't actually be in need of it. Statistically for many middle-income earners, that's a more optimistic rather than a realistic hope.

To lower-income earners, it's a more substantial portion of all the federal taxes they pay directly, and a more substantial, (than many greater income earners') portions of their entire annual incomes.

To lower-income earners and many middle-income earners, the FICA payroll tax is more of an additional hardship rather than a small expense.

Their FICA tax payments are a greater financial hardship to them in comparison the those in greater income brackets. For lower-income adults that are no longer in school or some other program they can reasonably expect to lift them into higher income brackets of much greater purchasing power, it would be optimistic to believe, (if and when they reach old-age), they will not have great need for their Social Security retirement benefits.
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Old 07-06-2019, 11:40 AM
 
71,463 posts, read 71,629,249 times
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I learned early on that if you can’t make do with what you earn then you can’t make do with a few percent less either so you may as well sock it away ..

I doubt there are many here who don’t believe for one second that if any of these lower income people you speak of had a few percent more in their check it would just get spent and likely not on anything that was a must .....I think taking fica taxes from them is going to reward those who need it later on greatly .

So we will just have to disagree and this subject has played itself out
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Old 07-06-2019, 11:55 AM
 
659 posts, read 276,164 times
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Quote:
Originally Posted by TaxPhd View Post
We have been through this so many times, it is really becoming tiresome. However, here it is, one more time, because you just don't seem to get it.

A regressive tax is one in which the tax rate increases as the base to which it applies decreases. That's it. It has NO other definition. And FICA does not fit the definition of a regressive tax.

What you are calling "regressive" is actually "disparate impact." The idea that a tax has a greater negative impact on a poor person than on a wealthier person. And this has been appropriately addressed in this thread, that EVERYTHING that one spends money on has a greater disparate impact on the poor vis-a-vis the rich. It doesn't matter whether we are talking about a tax or a gallon of milk.

Again, I'm not sure of the reason(s) for your continued insistence that various taxes are regressive when they clearly aren't. Words have meaning, and you do yourself no favors by insisting that a word means what you want it to, rather than what it actually does.
This post deserves being repeated.
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