Posted by Steve Rogers on 12/08/10

The IRS has dramatically lowered the federal withholding rates for 2010, supposedly to align with the "making work pay" tax credit; however that credit is capped at 6.2% or $400 for individuals or $800 for married couples. The reduction in withholding for most is much more than this, and will cause most people to have an unexpected tax burden come filing time.

One possibility worth exploring is that the administration needs the people to believe they are doing better financially by increasing their take home pay in the hopes that they will feel everything must be better, and would then go forth and spend. This may well work in the short term; however the piper must be paid. To understand the damage that this will cause, realize that aside from the 6.2% credit, the deductions and exemptions have not changed. So if they are taking much less from your paycheck and you have the same tax burden, come tax time in early 2011 most people will wind up with a rather unpleasant surprise (just after the elections, oddly enough). Some will owe hundreds, some thousands, and some even more. Not everyone has the ability to come up with these sums on demand which would then lead to what may be prong number two in this attack, penalties and interest.

Then there is what is called the "safe harbor" rule, which is based on how much you paid in versus how much you owe. If you owe the same or less than last year and paid in the same amount, and owe the IRS money at the end of the year, you could wind up with penalties. If you owe more, and paid in the same or 10% more in withholding, then you are much less likely to have trouble. This change will likely cause many people to wind up on the wrong side of this penalty, which is subjective on the part of the IRS leaving room for abuse.

I would also like to point out that as an employer NO mention of this has been made to me, which would have allowed me to inform my employees to adjust their withholding to a level that is appropriate to their anticipated tax burden. I have spoken with a long time friend of mine who is a CEO, and he has heard rumors to this same effect and also believes that it is stealth stimulus. As soon as he confirmed what I had found, he immediately walked to the payroll department to issue a memo to all employees to examine their withholding and make necessary adjustments. My accountant advised me to use the 2009 tables for consenting employees to allow me to withhold for them at what would be the normal rate for them to avoid any issues come tax time.

The change is closer to, but predominantly still more than the 6.2% credit in the higher income brackets, but for people with lower incomes, or those with several jobs, and therefore lower income per withholding event the changes are quite significant.

Here are a few examples:

At the mean (average) income of $41,732 (last available data from the census bureau) a married person with zero exemptions, paid $802 weekly has 13% less federal withholding, more than double the "making work pay" tax credit, and with 2 exemptions the change is 18%, almost triple the credit. Keep in mind 1 exemption is for you, 2 is yourself and a non working spouse or single with one dependent.

For someone paid $500 every two weeks (a lower paying job, or a part-time job) the rates dropped much more: Single with zero exemptions 28%, 1 exemption 48%, and 2 exemptions zero withholding, and all married persons in this bracket are now at zero withholding. These people are the most likely to have problems, and in this economy a lot of folks have lower paying or several part time jobs.

This unconscionable manipulation, cloaked in a tax credit, is in my opinion, going to cause trouble in the lives of citizens who have a right to know that they are being used as unwitting pawns in an economic shell game. Any administration willing to do something like this to prop itself up with an artificially created ‘recovery' at the expense of the people should be investigated by Congress and corrected immediately.

The 2010 tables are found in Publication 15, circular ‘E'

http://www.irs.gov/pub/irs-pdf/p15.pdf

The 2009 Publication 15 (for comparison) is no longer available from the IRS, archived by the author at:
http://www.rstevenrogers.com/reference/p15_2009.pdf

Mean income data from: http://www.census.gov/hhes/www/cpstables/032009/perinc/new10_001.htm

© 2010 R. Steven Rogers

 
Posted by Steve Rogers on 02/20/10

Lately I been wondering why, if the Minnesota GOP wants new members to participate in the political process, and based on the radio ads prior to the recent caucuses I will assume that they do, that they do not make much of an effort to ensure that these new members feel a part of the process. For example, at my recent convention several newcomers approached me feeling lost and not understanding the basics of how a convention worked.

In response, several folks from the Minnesota Campaign for Liberty and myself created a video series on understanding the basics of parliamentary procedure. This gives a solid overview of the basics of conventions with its primary focus on Robert's Rules of Order, so as to help newcomers to the political process not only be more comfortable, but also better able to fulfill their role as a delegate.

I am frankly astonished that no such tool, even a paper handout, is made available by the MNGOP, and to my understanding none of the other major political parties, to their convention delegates. Is it any wonder that politics in any party is run by "the old guard"? In my short involvement in the game, I have seen a large percentage of newcomers fail to return, often not even coming to the next convention to which they were elected. While there are many reasons to be disgusted by politics, this, at least, is correctable rather easily.

Along with the video series, we have also made available a powerpoint presentation and a one page table of motions that is a very handy reference to have at a convention.

I hope you find this helpful, and if so, please feel free to pass it along as we go into the spring convention season.

Links to the vids and the files can be found at http://www.mnc4l.org/parliamentary-procedure/

 
Posted by dwahlstedt on 11/18/09

Here's a link to an event this Sunday, 11/22, that you won't want to miss!

http://www.meetup.com/thegreenanchor/calendar/11656276/

Please RSVP to me at dwahlstedt@gmail.com if you will be attending so we make sure to have enough seating.

Dave Wahlstedt
612-281-7611 

 
Posted by dwahlstedt on 10/27/09

From Kris Broberg, GOP-endorsed candidate for Minneapolis City Council in Ward 13:

-----------------------------------------------------------------------

I was just informed of a report that rates Minneapolis precincts for
voter fraud.

Believe it or not many of the WORST precincts for VOTER FRAUD in the
city are in WARD 13.

If you do nothing else to help the campaign, I think assuring an
honest and fair election for all is a worthy achievement.

If you can be a poll challenger please let me know.  I will get you in
touch with Kaylea and get you some training.  We have two volunteers
so far but we have 10 precincts.  I would really like people who could
do the whole day, but you can do half days.

15% of all votes in the city come from Ward 13 so it is in the
interest to help our city wide candidates as well.

PLEASE HELP!

kris@krisbroberg.org
612-423-8848

or Kaylea
651-964-5435
klc@mngop.com

Tell Kaylea you want to be a challenger in Ward 13 for Kris.

 
Posted by minnesotachris on 10/26/09

A nice radio appearance by Dr. Paul on the Jason Lewis Show, KTLK 100.3 in Minneapolis/St. Paul:

Part 1: http://www.youtube.com/watch?v=X9Y3PbEh-xU

Part 2: http://www.youtube.com/watch?v=eHWRNgVE6fY