JoB
alki_2008
there is a simple solution for dual income families.. they file married filing separate and the spouse who didn’t get the bonus takes the tax hit on any investment income.
so someone with a real income of 80G would have his 80k salary + $40k retention bonus + $20k severance + $5k performance bonus for a taxable adjusted gross income of 141,000 assuming he had no other expenses to deduct and his personal exemption was 4,000… not a problem.
his wife would have her 70 plus 50 minus her 4… and any other deductions… total 116K max.
admitted, they would pay a small penalty for filing separately.. but still a long way from the 90% projected tax on bonuses.
BTW.. that’s $257,000 adjusted gross income which looks pretty good to a two income family, both of them lucky enough to make $10 an hour… without much in the way of benefits… who gross less than 41,600 after they pay social security … and may currently be trying to live on unemployment anyway.
let’s talk about that person with a base salary of $250,000.. they wouldn’t get all of their bonus taxed… they aren’t taxed on social security.. nor on money put into their retirement accounts… and on some benefits … and unless they had 0 tax write-offs … which isn’t so likely for someone with that base salary….
I am sure someone has done the math on how much a person would have to actually earn to end up paying the 90% tax.. but my conservative guess puts base salary at least a third above 250,000.
as for justifying the bonuses on the basis of the money those in the financial sector would put into their local economy for construction, remodeling, retail, etc…
i would like to point out that the union workers whose salaries were just “adjusted” as one of the conditions of their bailout would like to put their money back into their local economy too… for things like food, clothing and tuition…
and the communities those auto plants are located in really need every penny they can spend there.
if the government requires those in the auto industry to make wage concessions to get access to government funds, it’s not such a stretch to require the same of those in the financial industry.
The auto workers have already made their concessions and i didn’t hear one bit of anguish over their financial pain… or broken contracts.
in fact, i seem to have read that it was necessary employee cost control… to make the industry competitive.
So broken contracts are cost control for Auto workers but illegally broken contracts for those in the financial sector?
I don’t buy it.
btw… did that actually pass yet or are we just repeating the wailing the financial reporters are doing in advance trying to build public indignation so it won’t get passed or at least so that people won’t revolt if it doesn’t?