Both McCain and Obama will have to raise taxes to pay for programs for which the public is clamoring, whether those programs are universal health insurance, expanding the military, trying to retire the national debt, or simply trying to balance the budget.

McCain proposes to increase your tax exemption for children by something like 5/year. That’s it, if you have children you get something, otherwise not. This will increase the deficit.

McCain proposes a 00-00 "refundable" tax credit for the purchase of health insurance while apparently proposing, as I understand it, eliminating the deduction for employer provided health insurance. This is a tax increase for business to pay for a tax benefit to the public. This is, ostensibly deficit neutral.

McCain will cut the corporate tax rate from 35% to 25%. This is proposed to keep American companies on shore and to stimulate the economy. This will not keep companies on shore because the 10% tax savings on profits is miniscule compared to the as much as 80% operating cost savings of exploitation of cheap foreign labor. And since most corporations do not pay any taxes due to loopholes it is ridiculous. All that will happen is that those that are paying taxes domestically will pay less and increase the deficit.

All of this tinkering with tax cuts will result in a net tax increase because a higher percentage of the operation of government will be placed on your credit card.

Obama’s plan, a tax cut for the middle class, should be offset by rolling back the Bush 43 tax cuts for the wealthy. Curtailing tax loopholes for companies operating offshore will have far reaching effects including reducing the deficit. As far as funding for new programs goes, there is little doubt that these, like universal healthcare or improving public education and tuition programs, will go on your nation’s credit card.

What’s in it for me? After all, I’m paying for it.

Your taxes are going to go up with either Obama or McCain. For whom you vote, if that is your issue, depends entirely on how much they will go up and/or what you will get in return

I have a large number of deductions because of a home business, so maybe I won’t be paying taxes on it. I did put away enough $$ to cover the 28% if I get hit. Should I worry about it or let the IRS find it and send me a bill?
I listed the capitol gains on my taxes. That part does show up, so it isn’t that I didn’t list my income from my 1099-B. But it just doesnt look like I got hit with taxes (unless I had enough deductions that they were wiped out by the writeoffs). It isn’t that I withheld the information.

whereas high-earning business owner are the least hurt in this economy.. apart from wellfare bums.

there’s little deduction available for high-paying workers over 100k, basically almost half of their income go into paying taxes.

business owner, like me, can deduct a lot of expenses, put a much higher amount into SEP IRA, traditional IRA, start a parallel biz and deduct it as expense, and pay around 25% of total gross income.

And I mean flat across the board. Everybody pays 5%, for example. But to make sure everybody pays that 5%, no exemptions for yourself or dependents. Not deductions for work, charitable donations, etc. No deductions for business losses. Capital gains are considered income and taxed at the same rate. So you bought your house for K, sold it for 0K, you made k that year, it gets taxed like any other income. You inherited cash property or anything else, it’s income and gets taxed 5%. And all income gets taxed the exact same 5%. No hiding money for the future in 401(k) plans or IRA plans–no need to anyway, since the flat tax defeats the purpose. All income of any kind, a flat tax. No exceptions, including churches, which are currently tax exempt.

Anybody for that?
Let me clarify some things about my question. One, I am not sure whether I am for a flat tax or not. But I have thought that richer people have more opportunities to get out of paying taxes than poorer people do. So I wondered if richer people would still be for a flat tax if the the playing field were completely level–ie, no tax-sheltered retirement accounts, no itemized deductions for charitable contributions, no loopholes of any kind, as well as calling and income at all as taxable income, including the sale of private property, and also doing away the the tax-excempt status churches and not-for-profit organizations enjoy. Totally fair. Would they still go for it?

There are two numbers. Your top line sales which is you gross income. Then your deductions and expenses. That equals net income. Your net income is the bottom line. What you pay taxes on. This is where you fall when it comes to paying taxes. It seems most people don’t understand that the income of a business is not the taxable line.
After posting this I realized that I should have reworded the questions to "Do business owners understand that top line sales is not the same as bottom line sales?

I generate about 40k profit from my home office. When it comes to paying taxes and making deductions, what is the best way to set up my business? I live in Florida.

I asked the following question a few days ago:

"I’m a graduate student, but I also work part-time.

For my dissertation research, I’ve received 3 grants. Grant A is from a government agency — they gave the money to my university, which buys the stuff I need for me. I’m not going to declare this grant as income, and I’m not going to deduct any of the expenses. Grant B is the same, only it’s from a private foundation.

Grant C is from another private organization. Unlike the other two, they’re giving the money directly to me. They asked for my info to fill out a 1099 form. Does this mean that I have to include this grant as personal income?

When I use the grant for dissertation-related expenses (travel to collect data, lab supplies, publishing charges), can I deduct these when I prepare my taxes? I know that you can deduct business-related expenses if your employer doesn’t reimburse you, but does this count as a job? And I know that, as a student, you can deduct education-related expenses like tuition and activity fees, but this doesn’t seem to be in the same category."

The one answer I got said that no, I couldn’t deduct them. I didn’t like that (who likes paying taxes?), so I looked at the IRS website.

I found the IRA guidelines for deducting education expenses:

"You can deduct the costs of qualifying work-related education as business expenses. This is education that meets at least one of the following two tests.

The education is required by your employer or the law to keep your present salary, status, or job. The required education must serve a bona fide business purpose of your employer.

The education maintains or improves skills needed in your present work.

However, even if the education meets one or both of the above tests, it is not qualifying work-related education if it:

Is needed to meet the minimum educational requirements of your present trade or business, or

Is part of a program of study that will qualify you for a new trade or business.

You can deduct the costs of qualifying work-related education as a business expense even if the education could lead to a degree."

Here is my situation: I am a full time graduate student in anthropology. I teach anatomy part time at a different university. Obviously, I don’t need the PhD to teach, since I’m teaching now, but most of the other teachers have Ph.D.’s in anthropology or another field. My original career goal was to become a researcher. Now, I think I’ll stick with teaching. My dissertations doesn’t directly impact by ability as an anatomy teacher, but I think I’ll have more job opportunities with a Ph.D. (in any field) than I would if I didn’t finish my dissertation.

Do you think I can deduct my expenses as work-related educational expenses?
V.B., I’m not trying to twist the tax law … I was just trying to see if there was a way to save money since I’m going to have to pay taxes on thousands of dollars that are basically going to go straight to my advisor’s lab.

I am looking to buy two houses for use by me and family members. I would issue shares to me and two other members of my family. If I were to die, they would get the shares equally. I am hoping to do this to avoid paying taxes on the transfer of the houses from my name into theirs. Additionally, would the shareholders be able to use the companies deductions for mortgage interest in order to lessen their tax burden? Basically I am about to buy two houses, and I am looking to minimize the tax burden of passing the houses on upon my death.