" Dude, wanna know who doesn't pay federal income taxes? It's people making less than $46k per year."

Not true at all. Federal income taxes start above $15,750 for the year.

You're referring to a trust fund baby, and that number is closer to $55,000 with no federal taxes.

Meanwhile, a janitor who profits $55,000 from the sweat of his brow owes over $10,000 in federal taxes.

" year. The average bracket for that group is 3.3%."

Incorrect again. You are conflicting marginal rate with effective rate.

What "news" outlet told you income taxes don't start until after $47,000?

^conflating

Ah, the joys of working until 3 in the morning!

"TurboTax says my blended tax rate is 17.6%."

That's effective rate.

Now subtract $1000 from your taxable income, and see how much your bottom line changes.

That's your marginal rate.

"Roth IRAs don't have RMD... hmmm. I wonder who benefits most from that, is it rich people or poor people?"

Peter Thiel had $5 billion in his Roth IRA by 2019.

Pretty good for max contributions of $2000-$5500 per year.

"subtract $1000 from your taxable income, and see how much your bottom line changes."

Be aware of tax "pockets". I've seen folks in the 12% marginal bracket pay over 30% on income. Especially when a pension, Social Security, and income all collide. Each one makes the other more taxable.

You might be in the 12% bracket, but if you're paying 31% on your last 1,000, you're in the 31% bracket. But it can help, if you realize $7,000 to a Trad-IRA might save you two grand.

Sorry MB, I looked at both things you posted and saw nothing about folks making $47,000 and not paying income taxes.

Specifically, where did you get it? What article, what page, what paragraph?

"Yeah...I posted the wrong thing. Table 1."

OK ... in that case, table one doesn't say what you're saying. Not even close.

Are you going to Retract and apologize?

"table one doesn't say what you're saying. Not even close."

Aren't you supposed to have a degree in economics?

Shouldn't a statement like the one you made alarm you? You didn't realize it didn't pass the smell test???

"He already acknowledged the mistake. "

Um..no. He posted ANOTHER link, which still didn't prove his claim.

He owes a retraction. His statement was demonstrably false. His response was, proof is on a different page. It wasn't.

His claim is bullsheet. He's off by 200%. And you either didn't bother clicking on the links (quell surprise!), or did, and you don't comprehend what you're reading.

But seriously...$47000, and no income taxes?!? That doesn't pass the smell test, unless it's a trust fund baby.

I see MB has run away from taking responsibility for his post. Telling.

"Apologize? Like I wronged you or something."

Not to me; to the readers. Like any publisher making a mistake.

And "Split point"?!? That doesn't mean folks under that amount pay no income taxes. It means the average family has 3-4 folks represented by the tax return, so they've got two standard deductions, $4400 of credit for the two kids, and avenues to other child-rearing breaks, like the Child Care credit or the American Opportunity credit.

Also...beware: Republicans have stuffed all kinds of child-rearing (and other) breaks into the 1040, for the sole purpose of turning around and claiming higher and higher percentages of filers "don't pay taxes"...which is untrue on its face, but that's a different issue.

Also, remember it's scored differently today than back in the "welfare" days. Back then, if a couple paid $1000 in income tax via their W-2s, they were scored as "paying" income tax. If they got $100 a month in welfare because they had three kids, they were still scored as "paying". Why? Because they paid income tax. Now, that same scenario is scored as "NOT paying. income tax."

Back to the issue at hand: The standard deduction for a single 40 yr old is $15,750. Any taxable income above that number pays income tax. Claiming people who make $46,000 pay no income tax is insulting...

...unless you're talking about a Trust fund baby. He can open $64,000 worth of Proctor & Gamble dividend checks and owe ZERO federal taxes.

But that wasn't what you were talking about.

"And if the data is wrong, cool."

The data isn't wrong; your interpretation is wrong, and your statement is wrong. In both cases, you're leaving out the salient part:

Dude, wanna know who doesn't pay federal income taxes? It's people making less than $46k per year.

...who have a wife and two kids. At least finish the sentence honestly.

A Trust Fund baby pays ZERO federal taxes on $64K of qualified dividends, the most common kind.

A janitor profiting $64,000 pays over $13,000 in federal taxes.

"This is almost like a moon-landing denier demanding that NASA retract their position that they put on a man on the moon, and then apologize for it."

The problem was your telescope was aimed at Uranus.

"they are hurt."

I'm not hurt; I'm insulted by the stupidity. Especially from someone who claims to have training on the subject.

But how kind of you to carry water without bothering to look at the table. Maybe if you had, you'd see the obvious misinterpretation as well.

"I understood what he was saying. you're pretending you didn't."

That's as back-ass-wards as it gets. You had no idea he was regurgitating crap, and couldn't be bothered to educate yourself.

Now you're pretending you knew what he was saying? What, when he was lying about who pays income tax?

FFS, wouldn't you agree leaving out A SPOUSE AND TWO KIDS might have an effect on your bottom line???

"It's splitting hairs"

No, it's not.

People don't pay taxes under $46,000, and People pay taxes over $16,000 are WORLDS APART.

His claim is off by almost 200%. That's one big-effing hair!

"I understand what both of them are saying."

Not if you don't understand one of us is wrong.

Read his statement; nothing about a spouse or kids. Just regurgitated crap, based on a table he didn't understand.

"You pretend he was trying to slide that whopper past folks."

What a riot.

You were trying to pretend he's wasn't. More likely, you didn't realize it doesn't pass the smell test.

FFS, he hasn't come back to tell us he understands that was with an average spouse and kids.

Even a married guy with NO kids owes income taxes.

"But I have yet to see Danforth present a contradiction to any data provided in the study."

The "study" included the average family, dumfuq. The average family has either a spouse, a kid or two, or a combination.

A single person pays taxes on income over 15,750. It's as simple as that.

Anyone who is making $47K, and paying no income tax, has kids. In fact, a childless couple making $37K pays income taxes.

Do I need to make it any clearer???

"Again, I understand both of you."

Do you understand what he's claiming? And how he's leaving out all the elephant parts?

Does that mean you approve of the cherry-picked conditions, which don't exist for childless singles or couples, and leaving them out of the claim?

It's not like you'd issue someone insurance on a claim that off-base, would you?

"Is that your model economy, single 40 yr olds?"

I was just trying to say not-a-kid, not-a-geezer.

Different rules for those dawgs.

It's the standard deduction for anyone under 65 and working.

"His link was pretty clear, he's just using data provided by IRS?"

He suggested that someone making $46,000 didn't have to pay income taxes.

He left out the part where the threshold is really $15,750, and for someone making $46K to NOT be paying income tax, they've got to have a spouse and a kid, or two kids.

Hell, I can create a situation where someone is bringing in $46,000,000 and paying NO income tax. But if I represent that as routine...well, I've left out the salient part, haven't I?

And please don't think I'm making that last number up: Peter Thiel had $5 Billion in his Roth IRA (!) as of 5 years ago. I think it's safe to assume he has $5.3 Billion now, which is the average net worth of today's 3000 Billionaires (Math: Total Net: $16 Trillion)

That means Thiel saves over $1 million/week with the tax cut extensions. And since it's Roth...it's possible for him to pull in $46,000,000 in a year...without paying a penny in federal or state income taxes.

"(Then) enlighten me."

A single person pays taxes on income over 15,750. It's as simple as that.

Anyone who is making $47K, and paying no income tax, has kids, or a wife and a kid. In fact, a childless couple making over $32K pays income taxes.

"Does Table 1 not say..."

Did you say ""wanna know who doesn't pay federal income taxes?" or not?

"Do you disagree with the Tax Foundation's data? "

No.

I disagree with your representation under $46,000 means no income taxes.

If you're saying an average filer with a spouse and 1-2 kids doesn't have to pay income taxes on $46,000, I'm saying DUH. That's exactly what you'd expect in an equation with $15,750 per person as a standard deduction, and $2200 credit per child.

But you're intimating those who make $46,000 aren't charged income tax. It's misleading, at best.

"I've also noticed you're making no attempt to argue the data presented, why?"

Because it's your analysis of the data that sucks. Just say someone making $46000 doesn't have to pay income taxes...if they have a spouse and kids.

"That's why the reported numbers are averages."

And the average filer has a spouse and a kid, or a pair of kids. DUH.

"Does it not say that the average tax rate for the bottom 50% of taxpayers, or those making less than $46,637, is 3.3%?"

No, it doesn't. It says if you only count INCOME taxes, that's the result you get. It completely leaves out payroll taxes, the type the vast majority of workers (~70%) pay more of over their lifetimes. In fact, a worker has to make over $120K for his income taxes to catch up to his payroll taxes.

So sure, if you cherry-pick the tax you want, you can make the numbers say what you want.

For example, if you just do payroll taxes, and leave out income taxes, the numbers suddenly change drastically. Quelle surprise!