Originally Posted by Winstonbiggs
Unlike you I don't have kids who are any longer deductible, a majority of my income comes from wages most of with are at the top federal tax bracket. Since I'm self employeed my retirenment money comes off the top line and is not part of my adjusted gross income and as you well know is taxable later so no that doesn't reduce my tax rate from the adjustment it simply defers the tax until later.
I have very little income from dividends, have avoided tax free's like the plague because I think they very well could be viral and my investments are long term none interest paying since I don't need income now.
Since the OP was about rates and I'm paying in the low 20's effective federal tax rate I clearly do pay a higher rate then Romney.
Now while you keep telling us Romeny has a revenue nutral tax plan that lowers rates by getting rid of deductions, I would like to know which deductions are going to go? As you well know most every deduction has a constituent and getting rid of them without actually naming them is hardly belivable.
There are all kinds of loopholes involving trusts and foreign tax credits that could be adjusted or eliminated. They can eliminate mortgage deductions for people over a particular income threshold, they can eliminate the deduction for state and/or property taxes paid. They can eliminate the deduction for health insurance expense. They could eliminate the loophole for carried gains that hedge fund managers take advantage of.
My point? When in office you go to the IRS and take models of income and deductions being utilized by particular income categories then go in and model how much on average they would pay with those deductions eliminated then adjust the bracket rate accordingly.