Stealth Tax on the Middle Class
It’s the Social Security benefit tax. Here is Scott Burns:
This is not small change. According to the 2012 Annual Report by the Trustees of Social Security, $22.2 billion of the benefits paid out were taken back in income tax payments in 2011. More important, the amount had doubled from only $11.9 billion in 2002 — and that, in turn, was double the $5.9 billion collected in 1992. The same trustees report projects that tax collections will increase even faster over the next 10 years, nearly tripling to $61.7 billion by 2021.
If you are still working and think this doesn’t affect you, don’t go away. The unique construction of this tax — based on one of the only formulas in the entire tax code that isn’t inflation-indexed — means that more and more retirees, at lower and lower levels of real income, will be sending some of their Social Security benefits back to the Treasury in the future. This is a tax that quietly keeps on growing. The younger you are today, the more it will affect you tomorrow.
I would like to see the term “stealth taxes” become the new buzz word in political discussions.
Just how many of these stealth taxes are there? In how many other ways is the middle class being burned?
. Add to this another stealth tax that proponents are clamoring for: the VAT tax. Economists like VAT because people don’t know they are paying it.
I’ve never understood taxes on transfer payments..
Love how the govt. continues to burden the next generation with mountains of crippling debt, taxes, and restrictions.
They do not care about future generations…not even a little bit. Tax collections and all these regulations are only going to make it harder for future generations…or even current generations…to retire at a decent age. The government doesn’t care. Plain and simple!
Funny thing about Ponzi schemes, they don’t work.
And all should remember, you are not entitled to one penny of what you have paid over the years. Distribution Is purely at the discretion of politicians. Comforting Is it not?
Taxes are and will continue to drive Americans crazy.
In 2001 Social Security paid out $736B and had an income of $805B. If we take out the $22B “stealth tax” we have $714B out and $783B in.
At least social security is still above water.
So who’s the big winner from this stealth tax? the biggest borrower, the Federal Government.
Talking about taxation without representation. This tax is applied on all assets presumed to earn less than 2%….which is pretty much all the assets that Americans hold in banks.