CBS Money Watch: “Only ones guaranteed to pay more in taxes are individuals who ARE NOT top earners”

CBS Money Watch explains that the only people who are actually guaranteed to pay more in taxes this coming year are normal working class Americans, thanks to the payroll tax. The higher income earners, they say, have ‘tax reduction strategies’ that can help lower their taxes so that at the end of the day they aren’t in the top bracket where taxes got raised.

So basically, the ‘protected Middle Class’ that Democrats claim they stand for are the ones guaranteed to get gouged:

CBS MONEY WATCH – The “fiscal cliff” clash in Washington may leave middle- and lower-income Americans paying more in taxes while preserving a range of tax breaks for various industries and businesses.

After Congress opted to let a “holiday” on Social Security taxes lapse, under the bill signed into law on Wednesday working Americans will see a 2 percent increase in taxes on their gross salaries or wages. Make $50,000? That’s another $1,000 in taxes withheld every year. Someone making $15,000 would pay an additional $300. But because payroll taxes are capped for incomes greater than $113,700, people whose income exceeds that threshold pay $2,274 more a year.

It’s a regressive tax: The higher the income, the smaller percentage the increase represents. For everyone, meanwhile, it’s a net increase.

Will the rich really pay more?

The top marginal rate — the tax rate on the highest income brackets — rose to 39.6 percent, from 35 percent, for annual incomes over $400,000 for individuals and over $450,000 for households. Rates on long-term capital gains, dividends and estate tax rates for top earners also rose.

But given available tax reduction strategies, the impact of these increased rates can be greatly modified.

For example, in 2009 (the last year for which the IRS has available statistics) more than 790,000 tax returns fell under the then-top marginal rate of 35 percent. But after credits and deductions were applied, the average tax paid on adjusted gross income was 25.9 percent. The percentage paid on so-called modified taxable income — “the actual base on which tax is computed,” according to the IRS — was 29.7 percent.

In other words, relatively few taxpayers whose income reaches the top income tiers pay close to the listed top rate. It will be years before there is data to show whether the actual tax paid by top earners will come close to the 39.6 percent rate, or even the old 35 percent one.

In effect, the only ones guaranteed to pay more in taxes this coming year are individuals who aren’t top earners.


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  • LadyMacKeltar

    The first of many tax increases under Obama. We tried to tell the libs but they wouldn’t listen. They believed in all that “Hope and Change”. Unfortunately, now, we all have to live with the consequences.

    • Sober_Thinking

      The liberals still want more… THEY will never be satisfied.

      • LadyMacKeltar

        Libs will be happy when government finally controls everything and the people only have what the government wants us to have.

        • Sober_Thinking

          True indeed.

      • Ray

        what party worked with obama and got this fiscal cliff deal passed through both houses?

        • Sober_Thinking

          Both. That’s why I’m for a 3rd party wholeheartedly now. The two we currently have (excluding Libertarians) are too corrupt and screwed up right now.

          • Ray

            Don’t forget those independents as well.

            • Sober_Thinking

              That’s who should align under a new party. I’m an Independent… and man, I want a party for the people… not for themselves.

              Great point.

  • Ray

    This does not go with this article, perhaps I can be helped on where to send tips. NBC conneticut does not publish party affiliation of Connecticut State Rep who wants to publish names of all gun owner in his state. I called NBC Connecticut to find out about why, lady got huffy when I suggested if it had been a Republican that wanted to to ban something liberals want, “Republican” would have been all over the article.

    • Ray

      Well, it seems a phone call to keep them honest works, they changed the story and added the persons party before his name after I called them on it!

  • Conniption Fitz

    Exactly what Rush said earlier this week.

  • Ray

    start looking at the bottom of your receipts for obamacare tax

  • mikeinidaho

    Duh! Way to go, Lame Stream Media! You finally figured out or were finally willing to admit that Obama’s plans all along were to soak the serfs more and more as he works to collapse the economy and impoverish the country. Too bad all the stupid peasants haven’t realized that this was the plan all along.
    This country is doomed to be run by communists elected by the stupid!
    God help us as We the People fight to take back our Republic.

    • PatrickHenrysBody

      If I have to choose between food on my table and paying the bills (mortgage payment, water, gas, and electric aside) because Zero and the globalist authoritarians in Congress raised my taxes, I will choose to fight off the bill collectors. I’m sure I’m not the only one who will be doing the same thing.

  • NJK

    So basically, the ‘protected Middle Class’ that Democrats claim they stand for are the ones guaranteed to get gouged:

    Not only D’s, but Mitch McConnell and John Boehner willingly participated in this. Shouldn’t this bill have originated in the House? Mitch McConnell overstepped his bounds by doing what he did, and he needs to be held accountable for this. He needs to be fired.

    One of the R’s said they had to hold their nose and vote for this? No you didn’t. You did it willingly. I guess they assume this will get them off the hook. They act like high school kids who need to go along, just because their friends do it. God, why do we have such losers in this govt? We need people like Ted Cruz. Smart people, honorable people, not bums.

    • PatrickHenrysBody

      It was their plan all along. Any sane person could see it coming, which proves there are many insane people out there because Zero got re-elected. They drank the Obama-aid and asked for refills.

  • sjmom

    This should surprise no one but it will because most are uninformed, ill informed and misinformed. The American people will now complain but they voted for this. This is what happens; when you wish evil upon another as many did the higher taxes on the rich it comes back to bite you. Unfortunately, the rest of us must suffer as well.

    • Orangeone

      Correct! And the MSM, Barky Boy and Reid will blame Republicans.

    • PatrickHenrysBody

      Absolutely right!

  • colliemum

    It’s always those on middle incomes who are getting squeezed the worst.

    However, if the POs and Reid hadn’t played brinkmanship in relation to the ‘fiscal cliff’, senators might actually have had time to read what they voted for – even the speediest speed reader can’t go through 150+ pages in three minutes.

    But then – if low information voters had actually paid attention before 11/6 ….

    Follow the #WhyIsMyPaycheckLessThisWeek for some hilarious tweets – and for yet another proof that the left has no sense of humour, nor any understanding of irony …

    • Ray

      The reason why is because we have realized INCOME from doing something. The rich, for the most part, do not have realized income, they have stock options which do not count as income until it is LIQUIDIZED. That is why Warren Buffet pays a lower rate than his secretary. I KNOW this is anathama to conservatives, because it has been drilled into our brains by multimillionaires that we should not believe it, but look at it this way, OUR WAY of making income for day to day living is taxed, their way of making income to store away for some rainy day IS NOT. Who loses here? Why are we being taught to think that if it is NOT evil for us to be taxed on the way we make money, but it IS evil if THEY get taxed for the way they make theirs? Just saying.

  • 911Infidel

    Anytime that the Dhimiratz talk about helping the average Joe and Joette, they mean that they will be raising their taxes even more. They lie. I’m from the government and I’m here to help you. Yeah sure.

  • clockwindingdown

    We all are well aware they are trying and succeeding in separating the classes. They love elites and slavery.

    Look at what they did with school loans. Sold to kids that had no real experience with finances the idea of massive debt to start their adult lives. It is not uncommon for these young adults to have $60k -$225K in loans to pay back. We all know that paying these types of loans off takes years, upwards of 30 yrs, think a home mortgage! If one is paying off school loans will they never be able to pay/afford an actual home mortgage? If they cannot afford to purchase a home will they be able to build a retirement? Most homes can/are used to finance peoples retirements.

    These young people, our young people, have been betrayed by the system design to enable them and help them prosper, schools! How will they be able to help their own children, provide for better education, if they cannot get themselves out of a financial hole?

    The worse part, hard to believe I know, is that most of these young adults have degrees that they are not and cannot use to make a living. In other words the employment they are able to attain has no relation to their degree, hence their debt is for nothing!

    You see the left have sprung a multi prong attack on the youth of this nation. They are succeeding in creating a vastly separated class structure under the disguise of helping the middle class. The question is, helping the middle class to what end? The left never say that do they?

    • Orangeone

      Although I agree that the gov’t participated in the student loan debacle, the schools, and that includes public colleges and universities, as well as the parent(s) are a HUGE part of the problem. These children are not raised to work for anything and have been taught that others pay for it. Look at the students that receive a full ride because of income level or sports and then waste the education through excessive drinking, failure to attend class, failure to complete assignments, etc.

      I don’t want to get on my soapbox but I developed and teach a class on practical living that goes through financing of higher education, home purchase, retirement, etc. I teach it for FREE and have a heck of a time finding organizations that want this free instruction. It’s a gimme society.

  • PicklePlants

    And not to mention the Obamacare taxes that hit regardless of income.

    2.3% on medical devices – grandma needs an O2 tank? It’s more expensive.

    Do you use medical flex accounts to pay with pre-tax dollars? Not over $2500 you’re not.

    Americans for Tax Reform –

    • Orangeone

      Apparently the medical device tax is also hitting dental and veterinary.

      • unclesamnephew

        oh no! i was going to ask my doc of four legged family members if she would treat 2 legged family members to skirt arround “obama-careless”.

        • Orangeone

          Would be worth asking, it’s squishy what is classified as a “medical device”

  • aposematic

    The massive success these Demonic Marxist Democrats have achieved at keeping the poor poor over the past 60 years is expanding quickly to the top tiers of the Middle Class. The so called “rich” Obuma pretends to hate get a slap on the wrist while the Middle Class producers, Small Businesses, and workers get taken to the tax cleaners. And just wait until Jan. 1, 2014, when the mandate deemed a tax by our Marxist SC Chief Justice Roberts in Obuma(no)care fully kicks in.

  • MiketheMarine

    Gasp, shock, disbelief. You mean they lied to us while screwing us?

    Tell me it ain’t so…….

    {sarcasm off}

  • Ray

    I know this is not about this story, but, has anyone else noticed Breitbart seems to be moving to the left since Andrew passed on?

  • Sandra123456

    We are ALL going to have less buying power this year whether our taxes go up or not. Because of Obama policies the cost of food, health care, probably gas and other fuels will rise as the economy chugs to a total stop. So we are all getting screwed.

    • Ray

      But you have to ask yourself, if fuel costs goes up, who gains? If food prices go up, who gains? If the price of durable goods (which are manufactured over seas) goes up, who gains. Then ask yourself who loses?

  • Sober_Thinking

    I just got an announcement from my Human Resources people in my company explaining that my Social Security tax rate would increase from 4.2% to 6.2% and that “an additional Medicare tax will be withheld” from my next paycheck. I knew it would happen but when you see it in writing, it makes your blood boil.

    To put this in perspective, while I make a really good salary, I do not make more than 100k at all in any given year. Plus, I’m the sole money-maker in my household. So I am “middle class” based on many people’s definition. And yet, this bill penalized me for making a salary at all… and especially for being in the middle class.

    Let’s not kid ourselves. This bill that Boehner and company allowed to pass, does three things: 1) It allows the damn congress to keep right on spending even though they only have a few more pennies in their pockets (relatively speaking); 2) It sets a new precendent (a new “normal”) and allows the Democrats to slowly keep turning up the fire as they bleed us dry (see Scoop’s Maxine Waters post in TRS); and 3) It pays for the obomination known as Obamacare.

    The media is to blame for this. If they did their jobs, Americans wouldn’t support this at all (at least the honest ones) and congress and the monster in the WH wouldn’t either.

    • ryanomaniac

      Almost all of this boils down to the media. People cant get the honest truth. Any one that would report the truth they then demonize them over and over again so people will have a negative view of them and not take them seriously. Its disgusting. They are the head of the snake. You clip them and Obamas whole world falls apart. I just want honest reporting.

      • Sober_Thinking

        Spot on.

        To me, they are the root of all of this evil (since Satan controls them).

    • Orangeone

      The 4.2% to 6.2% is returning the employee portion of SS to the level it was at before the idiot in the WH dreamed up reducing it to claim he lowered taxes but failed to communicate that those were funds that would not be deposited into the SS fund. In essence, the temporary tax reduction was really temporary. The additional Medicare tax is ObamaTax!

      • Sober_Thinking

        I hear you… and understand.

        The bottom line is that there are now three (3) new “taxes” on me (the middle class) that weren’t there before. And two (2) of them now go to pay for Obamacare.

        It makes me so mad that I’m fortunately to the point of laughing because there are going to be some seriously ticked off Obama voters out there now.

        You make a valid point but I remain annoyed at the Republicans. They couldn’t make a stand for leaving the Bush Tax Cuts in place and lowering the upper two tiers of taxes so they could claim that they were actually in favor of lowering taxes on all Americans. Also, by doing that, it would have proven that Obamacare wasn’t free at all. So they did what they always do these days, they bent over and let the Democrats have their way with them – again. Anymore, when they sleep with their mouths open, they now sound like a “wind tunnel”.

        So avoidable… all of this.

        • Orangeone

          I absolutely agree with you!  Of the 21 ObamaTaxes, 12 will negatively impact me.  I will giggle every time an ObamBot whines and may actually carry leaflets with a smiley face and Election Consequence underneath it with the ObamaTaxes listed inside 🙂 🙂  Oh the claws just might be extended a bit…..

          • Sober_Thinking


        • PatrickHenrysBody

          Obama voters can b!+ch and moan all they want. I will not feel sorry for them. They voted the SOB in for another four years. They get what they voted for.

          • Sober_Thinking

            I’m smiling a toothy grin… you’re 100% right. It would be nice to see them bleed a little for this government like we have been forced to do now over the past few years.

            For the first time, some of them actually have some skin in the game now.

            • PatrickHenrysBody

              Yes it would and you are correct sir!

  • ryanomaniac

    Yep, the government pisses money away with waste and fraud and ineptitude. So lets take more from us so you can keep doing what you’re doing. How about combing the budget for the waste and fraud? How about doing your job? Like using math!!

    What I’d like to see is these Democrats run their own household the way they handle the economy of this country. If the things you wish to do work then Democrats…start first so we have proof that this works. You’ll be broke, in debt and you’ll lose everything you own you pricks.

    • Ray

      I’d like to see the Republicans who pushed and passed us over the real fiscal cliff with this deal run a real household budget like the ones they keep foisting upon us.

    • Sober_Thinking


      Makes too much sense…

  • EVERYBODY’s paycheck is smaller…
    No, you did not got a raise to $250,000+
    Just ask your boss.

  • Sober_Thinking

    Fair Tax. I stand with it as the great equalizer.

    • Arrrggghhh

      Exactly. Thank you. Our current code is simply a shell game. It is so complicated and has so many moving parts that it is incredibly easy for politicians and special interests to manipulate. A single, simple, transparent tax at the retail level on new goods and services would largely end Washington’s little game. The “prebate” would protect the poor. Productivity and hard work would no longer be discouraged (aka taxed). Amen to most of this class warfare crap. The answer is so simple that it’s frustrating.

      • Sober_Thinking

        Furthermore, illegal aliens and all tourists could finally pay their “fair share”. See? It even has the word “fair” in it! How could bleeding heart liberals be against that? 🙂

        • PatrickHenrysBody

          Bingo! Excellent point! No tax dodging by the illegals and those who visit the country. Even the foreign exchange students and those who are here on student visas would have to pay.

  • jleinf

    Obama wants to destroy the middle class and convertment into government dependent sheep

  • KenInMontana

    All those who draw a paycheck will see a 2.2% increase in the size of the bite the feds already take out every pay period. A little gift of “equalization” from our government.

    • Orangeone

      The 2% SS tax is returning to the 6.2% rate we’ve had for many, many years. The 0.9% is the new ObamaTax for Medicare that was part of the ObamaCare legislation.

      • joyfulgiver

        Yes, I understand it is only a return to where it was before the tax cuts, but the issue is the FACT that millions of people have relied on that extra smidgen for several years now. And with unemployment where its at and most families having to take multiple jobs to make ends meet, if your monthly budget is going to be cut by $78 it’s going to hurt, especially with gas still well over $3 in most parts of the country, home heating on the rise, food prices and electricity “necessarily skyrocketing”, it HURTS, a lot!

        The obvious solution would have been to extending ALL tax cuts till the economy turned around and private sector jobs were created. So, now many on fixed income salaries will be scraping by even more.

        • Orangeone

          I agree just want to be sure no one gets confused with the 2% from the temporary reduction with the new .9% additional Medicare tax because of ObamaCare!  They let the 2% expire in order to hide the new ObamaTax.

  • colliemum

    Winston Churchill said: “There is no such thing as a good tax.”

  • joyfulgiver

    Considering the fact that the SS tax cut was not renewed and that affects every single person that earns a paycheck, I think the article was written to cover up that fact. I love the way they word things in this article, like a 2% increase in SS taxes on your paycheck. How about wording it like this:

    Since, the SS tax cuts were not renewed, there will be a 2% decrease in your annual take home pay, for instance if you make $47,000 a year your annual pay decrease is $940 which will be a monthly pay check decrease of $78.

    Now, that puts things in perspective!

    • Orangeone

      But it’s putting it back to where it was and that should be included.

  • As per usual.

  • They will always come after YOU, regardless of how much you make. You can’t have a socialist state without confiscating everybody else’s money. Somebody has to pay for it, and that “somebody” is YOU. YOU are going to get stuck with the bill. And I will bet that it will only be a matter of months before the liberals demand a “Value Added Tax” (VAT) on everything to pay for our enormous debt which Obama drove sky high. THAT will be the cruelist tax because it will hit literally everybody and everything, from food to energy to every single commodity you buy. And if it worked so “well” in Europe, why not here? After all, Obama wants to turn us into a European-style welfare state, so why not go all the way and have a VAT tax as well? It’s coming. It’s only a matter of time.

    • Orangeone

      I’m afraid you are correct and it will be on top of income tax, ObamaTax, etc.

  • Rocco11

    You would like to think that at some point the state run Obama sycophant media would be forced to put his water down, and report honestly on the sheer volume of his destruction, but unfortunately their history suggests they’re incapable of reporting the truth on fellow travelers.

  • WordsFailMe

    Libs, Democommies, Unioniistas and socialist knee bangers- Welcome to Obama’s world.

    And, “he gonna do mo….”

  • Orangeone

    As much as I hate this bill, it permanently fixed AMT which if left unpatched would have seriously gouged the middle class. That can had been kicked down the road for a very long time.

  • c4pfan

    What else is new and how much you want to bet the GOP will get the blame?

    • ryanomaniac

      Its more like they’ll take the blame. The GOP are getting good at getting ahead of the situation.

      • Amy

        LOL – sick but true…

  • Conniption Fitz

    So many lies floating about from every direction. Turns out, there is no tax relief for middle income families…in fact, that is what they raised. The rich are well-protected.

    What we do know is that there is a 41 to 1 ratio spending to cuts.


    A picture is worth a thousand words.

    It would seem that DC stands for Dirty Crooks.
    The highest per capita incomes are in the DC area…
    and the highest increase in incomes IN 2012 is in the DC area.
    Tells us all we need to know.

  • repubboy

    Obama wants more taxes.. Come on America Wake UP !!!

  • PatrickHenrysBody

    I…am…so…surprised. Zero said that the middle class “will not see their taxes go up.” He was right. They didn’t see their taxes go up, although they did. Zero made sure of that.

  • mediaaccess1

    It’s always been that way, and Obama’s an idiot- well, I wish he were. No, he’s not an idiot, he just hates us all.

  • BikerHoop

    Sounds like I’m going to hear the Obamabots at work start squealing soon. Can’t wait. I tried to tell them what the usurper-in-thief was up to. I don’t have to tell y’all what they said. Anyway, the last ‘laugh’ is on them… and I will rub it in.

  • ApplePie101