The majority of American pay income taxes. Choice of words gives rise to a claim that many Americans do not pay income taxes. Those Americans pay "withholding" taxes.
"Taxable income" is defined as "[g]ross income minus all allowable deductions and exemptions; taxable income is multiplied by the applicable tax rate to compute one’s tax liability." Black’s Law Dictionary, pocket ed., 1996.
26 U.S.C. (United States Code) § 1 generally requires everyone to pay taxes on their income. 26 U.S.C. § 61 defines the various types of income considered taxable. 26 U.S.C. §§ 3401-3406 provide for withholding of income for, amongst other matters, tax liability of the individual. When Mitt Romney said 47% of the people in this country pay no income tax, in part he was right. People who are disabled or people who are below the poverty line generally do not pay income taxes. As a society, we have recognized those people cannot pay taxes.
People who work at a job and are subject to income withholding PAY INCOME TAXES. They might receive a refund at the end of the year. Usually that is not a large percentage of what they paid over the course of that year. When I worked at Purdue University, I claimed "zero" for deductions so that I could receive a larger refund. My doing so was legal. Also, while it was a means of my saving a little for a "bump" in March (when, usually the refund check arrived and I promptly threw a party), it was an interest-free loan to Uncle Sam. Most of the money I paid was kept by the Federal and state governments.
I paid taxes. Those taxes were on my income. Therefore I paid income taxes.
Today I am self-employed. I pay taxes directly to the IRS.
The only difference between payment of one’s tax liability on income straight to the government and withholding is method of payment. That’s it.
Yes, there are people out there who take advantage of the system. There are a lot at the top of the income mountain, up there on the summit, who take advantage of every loophole available to them. At the same time, those people derive benefits from government dollars. That is classic "freeloading."
There may be people who are on Social Security disability whom one would say are not "disabled." The process by which one obtains SSI is difficult and circuitous. The first application usually is denied. Then comes the process of appeal. One might be approved or receive another denial, as a result of appeal, in a year or 18 months. The anecdotal references to a physically-fit person who draws disability is an example of an exception to the rule. People who genuinely are disabled have to negotiate around hoops to obtain compensation provided by law.
And the benefits are good for our society, else we see disabled Americans forced to beg on street corners.
Finally, and for the record, I would qualify as a part of Mitt’s percentage. And I can guarantee that I will not cast my vote for him in the general elections.
Comment
I don't think Romney was saying that people who have taxes withheld as part of their job aren't paying income taxes. I do get a kick though out of people who claim they don't pay any taxes when they're just having too much withheld out of their checks and getting a refund at the end of the year.
I totally disagree with you on disability. I am shocked at the number of people who receive a disability paycheck in Indiana. I had a person the other day who I saw was going for disability income. Her sister was disabled, her brother-in-law was disabled, her mother was disabled. It was a family thing.
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