Bill would require drug test to claim high-dollar tax deduction

[GMDino]

http://thehill.com/policy/finance/283795-bill-would-require-drug-testing-for-those-claiming-large-amount-of-tax

Quote:A Wisconsin Democrat is pushing back against restrictions on welfare recipients with a bill that would require the wealthy to submit to a drug test before claiming high-dollar tax deductions. 



Rep. Gwen Moore rolled out the legislation, the Top 1% Accountability Act, on Wednesday.
Several states, including Wisconsin, require drug tests for at least some recipients of benefits under the Temporary Assistance for Needy Families program.


And Wisconsin Gov. Scott Walker ® also expanded such tests to some recipients of unemployment benefits and recently sued the federal government in an effort to drug test recipients of food stamps under the Supplemental Nutrition Assistance Program (SNAP).


Those in favor of such policies argue that drug testing will save money and make recipients more responsible. A Think Progress study found the cost of administering such tests outstrips potential savings from catching violators.


Moore described such laws as unfair persecution of the poor.


In an interview with The Guardian, Moore said she is “sick and tired, and sick and tired of being sick and tired, of the criminalization of poverty.”


“We’re not going to get rid of the federal deficit by cutting poor people off SNAP," she said. "But if we are going to drug-test people to reduce the deficit, let’s start on the other end of the income spectrum.” 


Under Moore’s bill, those filing more than $150,000 in itemized tax deductions would have to submit proof of a clean drug test within three months of the tax-filing date. Those who fail or refuse to do a test would not be eligible for itemized deductions and would have to use the standard deduction, which for most single people is $6,300.

Higher earners are more likely to itemize deductions, such as for mortgage interest and charitable contributions to reduce their taxable income further than the standard deduction allows.


Moore said Speaker Paul Ryan, also of Wisconsin, inspired her to introduce the bill with his unveiling of the House GOP’s blueprint to fight poverty at a drug treatment center last week, which she told The Guardian was the "last straw." 



“As a strong advocate for social programs aimed at combating poverty, it deeply offends me that there is such a deep stigma surrounding those who depend on government benefits, especially as a former welfare recipient," Moore said in a Thursday statement. "Sadly, Republicans across the country continue to implement discriminatory policies that criminalize the less fortunate and perpetuate false narratives about the most vulnerable among us. These laws serve only one purpose: stoking the most extreme sentiments and misguided notions of the conservative movement."

Fair and equal.  Seems good to me.

[JustWinBaby]

This is beyond stupid.

In the case of welfare, people are being GIVEN money other people earned. In the case of deductions, it's about KEEPING money YOU earned.

Only in the liberal world is keeping more of your own money a handout. Sort of like that Nancy Pelosi logic that "tax cuts are spending choices" - wait, wut?!?

[GMDino]

(06-17-2016, 12:11 PM)JustWinBaby Wrote: This is beyond stupid.

In the case of welfare, people are being GIVEN money other people earned.  In the case of deductions, it's about KEEPING money YOU earned.  

Only in the liberal world is keeping more of your own money a handout.  Sort of like that Nancy Pelosi logic that "tax cuts are spending choices" - wait, wut?!?

I believe in drug testing for everyone.

Elected officials, everyone.

[*Nately120*]

(06-17-2016, 12:36 PM)GMDino Wrote: I believe in drug testing for everyone.

Elected officials, everyone.

Either you own a company that provides drug testing services or you are just a fan of wasting taxpayer money.  Hmm....

If you can't tell I'm on drugs without an expensive screen or test, why worry about it at all?

[BigPapaKain]

(06-17-2016, 01:19 PM)Nately120 Wrote: Either you own a company that provides drug testing services or you are just a fan of wasting taxpayer money.  Hmm....

If you can't tell I'm on drugs without an expensive screen or test, why worry about it at all?

Oh please. 90% of government spending is a waste of taxpayer money. Drug tests on everyone would be way more helpful than most of the shit they do (that being nothing or filibusters).

[Benton]

(06-17-2016, 12:11 PM)JustWinBaby Wrote: This is beyond stupid.

In the case of welfare, people are being GIVEN money other people earned.  In the case of deductions, it's about KEEPING money YOU earned*.  
 

* as opposed to paying taxes on it like other people.

If tax breaks are across the board, I don't have an issue with it. But if your deductions are only available due to your bracket, that's not a break, that's charity.

[JustWinBaby]

(06-17-2016, 02:58 PM)Benton Wrote: If tax breaks are across the board, I don't have an issue with it. But if your deductions are only available due to your bracket, that's not a break, that's charity.

I'm not aware of any deductions only available to certain tax brackets.  Perhaps you can enlighten me.

Wait, I take that back....I AM aware of deductions that are PHASED OUT as you reach higher tax brackets.  But I'm pretty sure you aren't talking about those.

[Millhouse]

(06-17-2016, 12:11 PM)JustWinBaby Wrote: This is beyond stupid.

In the case of welfare, people are being GIVEN money other people earned.  In the case of deductions, it's about KEEPING money YOU earned.  

Only in the liberal world is keeping more of your own money a handout.  Sort of like that Nancy Pelosi logic that "tax cuts are spending choices" - wait, wut?!?

It's not stupid. Its her way of getting good publicity within her district (Milwaukee) with her re-election coming up in November. She is an African-American and her district has a slight majority of African Americans. She knows what she is doing since there is no chance it will go through, and I would too if I was a politician to keep my seat in Congress lol. 

[Benton]

(06-17-2016, 03:05 PM)JustWinBaby Wrote: I'm not aware of any deductions only available to certain tax brackets.  Perhaps you can enlighten me.

Wait, I take that back....I AM aware of deductions that are PHASED OUT as you reach higher tax brackets.  But I'm pretty sure you aren't talking about those.

You can't write off interest on your john boat. You CAN write off interest on your yacht claiming it as a home. Likewise, you can write off mortgage interest on your home. If you've got a second home (or a yacht) you can write that off, too.

Speaking of boats, in my county (can't speak across the board) you pay a smaller property tax on larger boats than smaller ones. I don't remember the sizes, but it's basically fishing boats and smaller pay a higher tax, whereas anything larger (houseboats up to yachts) pay about half that rate.

Own a horse? They cost money and don't give many breaks... unless you own a race horse. Those have healthy depreciations and deductions.

I think it's expired, but as of a few years ago, you could also over depreciate some larger luxury vehicles provided you write them off through a business. Due to the way it was written, there wasn't anything that qualified under $60,000. I think it went up to $100,000 depreciation per year, or that might have been two years. I don't remember, and it really doesn't matter. The Hummer loophole.

[JustWinBaby]

(06-17-2016, 03:37 PM)Benton Wrote: You can't write off interest on your john boat. You CAN write off interest on your yacht claiming it as a home. Likewise, you can write off mortgage interest on your home. If you've got a second home (or a yacht) you can write that off, too.


Own a horse? They cost money and don't give many breaks... unless you own a race horse. Those have healthy depreciations and deductions.

I think it's expired, but as of a few years ago, you could also over depreciate some larger luxury vehicles provided you write them off through a business. Due to the way it was written, there wasn't anything that qualified under $60,000. I think it went up to $100,000 depreciation per year, or that might have been two years. I don't remember, and it really doesn't matter. The Hummer loophole.

None of those deductions are specific to a tax bracket.  A lot of people I wouldn't consider anything close to rich or "getting charity" have a second home or vacation home (which "yachts" that hardly break the bank can qualify as).

Likewise, many self-employed people who don't make millions make questionable deductions of personal expenses as "business expense".  Again, you don't have to be rich to take advantage of this.

Mortgage interest on a home?  Seriously?  I'm pretty sure millions of Americans that are far from rich take that deduction.  If you can't afford a home then most likely you don't pay federal income tax.

Horse racing I might give you.  Although it's hardly the smoking gun or that significant.  Further, you actually have to make an occasional profit or it's considered a hobby and you can't deduct expenses.  Of course, deductions such as this and the yacht (and Tesla cars!) are more industry subsidies than handouts to the rich. But you still don't have to be rich to own a "yacht" as a second home, or a Tesla, and you get to take the deduction regardless of your tax bracket.

[Aquapod770]

(06-17-2016, 03:37 PM)Benton Wrote: You can't write off interest on your john boat. You CAN write off interest on your yacht claiming it as a home. Likewise, you can write off mortgage interest on your home. If you've got a second home (or a yacht) you can write that off, too.

Speaking of boats, in my county (can't speak across the board) you pay a smaller property tax on larger boats than smaller ones. I don't remember the sizes, but it's basically fishing boats and smaller pay a higher tax, whereas anything larger (houseboats up to yachts) pay about half that rate.

Own a horse? They cost money and don't give many breaks... unless you own a race horse. Those have healthy depreciations and deductions.

I think it's expired, but as of a few years ago, you could also over depreciate some larger luxury vehicles provided you write them off through a business. Due to the way it was written, there wasn't anything that qualified under $60,000. I think it went up to $100,000 depreciation per year, or that might have been two years. I don't remember, and it really doesn't matter. The Hummer loophole.

This is why I'm for a low flat tax rate with little to no deductions.

[JustWinBaby]

(06-17-2016, 04:36 PM)Aquapod770 Wrote: This is why I'm for a low flat tax rate with little to no deductions.

But that's actually regressive....if the rich currently pay in the neighborhood of 20% (because most of their income is capital gains), a flat rate at that level would be a significant increase to many middle income earners. 

It might be workable, though, if you only make it on income over $50k (since many below that pay little to no federal income tax).

You could go a step further to offset or augment it with a VAT on luxury items (cars, Iphones, big screen tv's, etc).  But I agree with many others that I don't want to see new revenue sources until the govt starts showing some fiscal prudence.

Personally I'd rather see elimination of the corporate tax (maybe save a penalty on excess liquid reserves), offset by elimination of capital gains.  That would actually be revenue and personal investment neutral, yet favorable to corporate investment (because the average effective corporate rate @22% would be offset at the investor level going from 20% capital gain to about 39% ordinary income).  That would be one heck of a start.

[Rotobeast]

(06-17-2016, 03:37 PM)Benton Wrote: I don't remember, and it really doesn't matter. The Hummer loophole.

What does this have to do with Bill Clinton ?

[*bfine32*]

Test the rich people, find out what drug they are on, give it to the poor people.

[JustWinBaby]

(06-17-2016, 04:54 PM)bfine32 Wrote: Test the rich people, find out what drug they are on, give it to the poor people.

I'm thinking Trump might be on bath salts

[Benton]

(06-17-2016, 04:05 PM)JustWinBaby Wrote: None of those deductions are specific to a tax bracket.  A lot of people I wouldn't consider anything close to rich or "getting charity" have a second home or vacation home (which "yachts" that hardly break the bank can qualify as).

Likewise, many self-employed people who don't make millions make questionable deductions of personal expenses as "business expense".  Again, you don't have to be rich to take advantage of this.

Mortgage interest on a home?  Seriously?  I'm pretty sure millions of Americans that are far from rich take that deduction.  If you can't afford a home then most likely you don't pay federal income tax.

Horse racing I might give you.  Although it's hardly the smoking gun or that significant.  Further, you actually have to make an occasional profit or it's considered a hobby and you can't deduct expenses.  Of course, deductions such as this and the yacht (and Tesla cars!) are more industry subsidies than handouts to the rich. But you still don't have to be rich to own a "yacht" as a second home, or a Tesla, and you get to take the deduction regardless of your tax bracket.

No matter where you put some of that stuff, a lot of it can't be afforded outside of higher earners. As I said, I dont mind deductions if they're available to all. As those examples and others only apply to a small group, they don't. Not in the same way as writing off mortgage interest, which applies whether you owe a dollar on your house or a million. There aren't many dollar yachts.

[Benton]

(06-17-2016, 04:54 PM)bfine32 Wrote: Test the rich people, find out what drug they are on, give it to the poor people.

Isn't cocaine still the drug of choice in congress? Most of them are doing ok cash wise.

[StLucieBengal]

(06-17-2016, 12:11 PM)JustWinBaby Wrote: This is beyond stupid.

In the case of welfare, people are being GIVEN money other people earned.  In the case of deductions, it's about KEEPING money YOU earned.  

Only in the liberal world is keeping more of your own money a handout.  Sort of like that Nancy Pelosi logic that "tax cuts are spending choices" - wait, wut?!?

Couldn't have said it better myself.    

[JustWinBaby]

(06-17-2016, 05:04 PM)Benton Wrote: No matter where you put some of that stuff, a lot of it can't be afforded outside of higher earners. As I said, I dont mind deductions if they're available to all. As those examples and others only apply to a small group, they don't. Not in the same way as writing off mortgage interest, which applies whether you owe a dollar on your house or a million. There aren't many dollar yachts.

The yacht is a horrible example.  For a decent number of people a modest "yacht" is their second home - it qualifies because it's a second home and not because it's a boat.  For others, they legitimately use it as a business for tours, parties or fishing expeditions.  The "business entertainment" is kind of BS, but no different than other personal expenses put on company books that many sole proprietors of all levels do.

The horse racing and luxury cars are pretty piddly for those people and are much more an industry/company subsidy than a handout to the rich.  BY FAR the biggest difference in marginal tax rates is driven by capital gains.  The rest is mostly just political talking points that don't really move the needle other than to enrage a voting base that doesn't know better.

Carried Interest (a type of income, not a deduction) is probably the biggest hole that dwarfs - combined -  everything else like horses and cars you'd bring up, but eliminating it would "only" yield about $10-$20B a year.

[fredtoast]

If yiou are really concerned about the government budget there is zero difference between giving a poor person food stamps and giving some other people a tax break. They have the exact same effect on the budget.

So if you are in favor of making thr poor take drug tests to receive benefits then you should also be in favor of making anyone who wants to deduct home mortagage paymets also be drug tested. Both have the exacts same effect of the government budget.