Tuesday, October 14, 2008

A serious Question, Obama supporters please help

First of all Do Not take this the wrong way, I'm not against Obama and I'm not for McCain. I'm asking a serious question and I know a few of you are pretty passionate about Obama, so that is why I ask.

I also know this is a long post, so if you don't want to read through it all please read the bold questions 1) and 2). That is all that really matters. Thanks.

Lately, the question of Obama's stance on small business taxes has become a big deal to everyone, at least on the right.

I have been trying to figure this out for quite sometime now and haven't gotten much. Sometime in June I tried to find the tax breakdown and what it will all mean if Obama gets elected and really couldn't find anything of exact detail (yes, from his website). Later in the summer I came in contact with someone from the ND office/supporters of Obama and she couldn't tell me anything other than that which I had already seen on his website. She told me that I would be better off as Obama would be giving me a $1,000 credit or something to that effect(which wouldn't mean crap to me in the long run if my taxes went up even 5%).

Personally, my income is low enough that I would assume anything he does will benefit me - I would hope, because I sure as hell couldn't afford to pay more taxes.

One thing that I did see is that he emphasises that he will do a lot for minority business start up etc. I don't understand why it wouldn't be the same across the board, anyone who wants to start up a business should get the same deal, right?

Anyway, I have 3 questions.

1) The $250,000 tax increase issue for small businesses. Is this on Net or Gross?

-I did see somewhere that they mentioned net, but it was used so vaguely that I couldn't tell if that is what the actual tax will be on.

- I know the right is trying to make it sound like gloom and doom - I don't trust anything they say. I have heard the right say that Obama made a statement to the effect of 90 some % of small business don't make more than the $250,000 per year. Unless they are talking about net (which I would still have a hard time believing) it is a blatant lie- that is if Obama even made that statement.

2)The other question is on the taxation of small small businesses, such as myself.

- I know personally as a small business s-corp, I already pay close to 30 some % on my gross when it is all said and done (some of which is taxes you all pay, and the other half is taxes you do not pay - unless you are an s-Corp that employs yourself) and I net less than 30,000 per year. The thought of my taxes going up mortifies me.

3) What can you say of this statement from McCain's site?

- "John McCain's opponent wants to increase the marginal income tax rate which applies to the nation's 23 million small business owners who pay their taxes under the individual tax rate system."

Anyway, thanks for your time. I apologize in advance if this info is blatant on Obama's website, but I have looked and couldn't find any specifics - hopefully I have been looking in the wrong place. And for the record I think McCain is a d-bag and I couldn't find much of value on his site either.


Plains folk said...

And no, I'm not a 1 issue voter.

For anyone who might think that.

UltimateP said...

I'll take a shot at your questions...

1. The tax rate is based on net income. You will always be able to write off work expenses and subtract from your gross income. I'm not sure about the 90% statistic but I'd venture to guess that a lot of businesses don't make huge profits (mom and pop stores that have extremely narrow margins).

2. I read some articles that say it depends on how you file your taxes and how your business is set up. I'll forward you more specific info as I come across it.

3. The way I understand it, the marginal tax rate is the same as the individual tax rate. If your net income is less than $200k, your taxes will go down under both candidates (more under Obama). It will stay about the same if your income is between $200k and $250k under Obama. And above $250k, it'll go up.

But keep in mind that any tax plan has to clear Congress and could be a lot different than the plans either candidates are trying to sell in their campaigns. Oh yes, and McCain is a major d-bag!

Plains folk said...

Thanks, your response is helpful and I appreciate it.

I was beginning to think that 1) either nobody knows; or 2)people don't want to give me the answer since I wouldn't like it; or 3)people just don't care to respond to my posts.

I would appreciate the info if you have it at hand, if not no worries.

And, your comment about congress is absolutely correct and it seems that so many people forget that.

Thanks for the input.