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Old 02-10-2011, 07:04 AM   #121
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Originally Posted by youbet View Post
States already means test Medicaid benefits. Have assets? No nursing home benefits for you until you spend down to a allowable level. The feds could do the same with SS. When you apply for SS benefits you present an accounting of your net worth.

The gov't can be ingenious in its ability to seize property from its citizens.
There's a lot of victim speak here and through out this thread. While I think SS and Medicare are entitlement programs (we've been paying for this insurance through SS and medicare tax on earned income) - Medicaid is not. Medicaid is a welfare program for people who - for whatever reason (poor planning or personal tragedy) do not have the means to pay for their medical care.

Since I'm forced to participate in SS and Medicare I feel like the government is steeling my premiums right now. At least as far as SS goes, I think I could get a better return on my investment even if they pay me the lifetime annuity they said they would. But like money that's been stolen from me, I don't expect the thief to return it. If I get anything back, I'll certainly take it - it's mine. But if I don't get anything - I've already written it off as a loss.

And I don't consider paying for my long term care myself (if I need to be in a nursing home for example) as the government sizing my property. I consider that taking care of myself. If I'm concerned long term care for myself or my husband will eat into our nest egg too much - then I'll purchase long term care insurance myself. But my plan is certainly not to make myself destitute in hopes that I'll qualify for medicaid and then hope that the government will take care of me.

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Originally Posted by obgyn65 View Post
Hello Patrick - I consider myself "wealthy" and I would have no problem being more taxed / more means tested ONLY IF it means the creation of more meaningful, concrete social programs for the ones in need. I would have no problem either paying 10%-20% more in income tax if it helps the creation of a true universal healthcare program.
And the government is well know for it's ability to take care of people

I would rather donate money to a charity that is actually good at helping people then to pay even more taxes into the black hole that is the government. The government is just not set up to do a good job at this.

As soon as people realize that it's not the governments job to take care of them - or to take money from them to redistribute to others who don't have as much - the better off we'll be as a country.
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Old 02-10-2011, 09:22 AM   #122
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There's a lot of victim speak here and through out this thread. While I think SS and Medicare are entitlement programs (we've been paying for this insurance through SS and medicare tax on earned income) - Medicaid is not. Medicaid is a welfare program for people who - for whatever reason (poor planning or personal tragedy) do not have the means to pay for their medical care.

Since I'm forced to participate in SS and Medicare I feel like the government is steeling my premiums right now. At least as far as SS goes, I think I could get a better return on my investment even if they pay me the lifetime annuity they said they would. But like money that's been stolen from me, I don't expect the thief to return it. If I get anything back, I'll certainly take it - it's mine. But if I don't get anything - I've already written it off as a loss.

And I don't consider paying for my long term care myself (if I need to be in a nursing home for example) as the government sizing my property. I consider that taking care of myself. If I'm concerned long term care for myself or my husband will eat into our nest egg too much - then I'll purchase long term care insurance myself. But my plan is certainly not to make myself destitute in hopes that I'll qualify for medicaid and then hope that the government will take care of me.



And the government is well know for it's ability to take care of people

I would rather donate money to a charity that is actually good at helping people then to pay even more taxes into the black hole that is the government. The government is just not set up to do a good job at this.

As soon as people realize that it's not the governments job to take care of them - or to take money from them to redistribute to others who don't have as much - the better off we'll be as a country.
Oh, now you've done it, you wascally wabbit...
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Old 02-10-2011, 11:15 AM   #123
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What you say is the key.
It may not be means testing but just inflation and/or an increase in the tax rates that eats away from what you keep of SS.



Benefits Planner: Taxes and your Social Security benefits
No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal Revenue Service (IRS) rules. If you:
  • file a federal tax return as an "individual" and your combined income* is
    • between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits.
    • more than $34,000, up to 85 percent of your benefits may be taxable.
Does muni bond interest count as income?
does Roth IRA income (distributions) count as income?

Last I checked, both are not factored into above.
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Old 02-10-2011, 11:24 AM   #124
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Does muni bond interest count as income?
does Roth IRA income (distributions) count as income?

Last I checked, both are not factored into above.
Are you trying to game the rules before any rules are there to be gamed ?
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Old 02-10-2011, 11:36 AM   #125
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I could be wrong about this but I think once you get above 32K in income your ss income becomes taxable. the amount you make above the 32 decides what percent is taxable. you have to do the irs worksheet to find out.

I believe it is income+50% of SS which goes into the calculation and not income alone. And income is not equal (Roth and muni bond interest I do not think is considered income).
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Old 02-10-2011, 11:52 AM   #126
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A few pages back there was a post about means testing... here is a few things to think about... I am not an expert in government taxation and appropriation, but feel free to correct any assumptions made by me...


Payroll taxes... 6.2% goes to SS
another chunk goes to federal income tax...

the company writers ONE CHECK and pays it all as taxes

then someone in gobernmunt land puts 6.2% into one budget and the balance into another budget. <---- this is my point of emphasis

once per year, this is verified when people file their tax returns with the IRS.

If the "means test" is forced on at the tax return level, did that really help the system stay solvent? It does indirectly, but all money from federal tax returns goes back into IRS, does the IRS kick the portion of SS tax back to the SS administration (budget) or just allocate that money back to a general fund.

The most likely means test, IMO, would be to cut problem off before tax return is filed, so when the SS administration reports "surplus" vs "deficit" it is a bottom line calculation (meaning spent less than taxes collected based on 6.2% payroll tax).
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Old 02-10-2011, 12:04 PM   #127
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A few pages back there was a post about means testing... here is a few things to think about... I am not an expert in government taxation and appropriation, but feel free to correct any assumptions made by me...


Payroll taxes... 6.2% goes to SS
another chunk goes to federal income tax...

the company writers ONE CHECK and pays it all as taxes

then someone in gobernmunt land puts 6.2% into one budget and the balance into another budget. <---- this is my point of emphasis

once per year, this is verified when people file their tax returns with the IRS.

If the "means test" is forced on at the tax return level, did that really help the system stay solvent? It does indirectly, but all money from federal tax returns goes back into IRS, does the IRS kick the portion of SS tax back to the SS administration (budget) or just allocate that money back to a general fund.

The most likely means test, IMO, would be to cut problem off before tax return is filed, so when the SS administration reports "surplus" vs "deficit" it is a bottom line calculation (meaning spent less than taxes collected based on 6.2% payroll tax).
Jimoh:

Since they went to the "Unified" budget in 1968, it all gets put into a single pot. There is no separation of SS money from other money. You can thank Lyndon Johnson for that. They just couldn't keep their hands off of it.

The oft-discussed SS separation/trust-fund is nothing but an accounting gimmick.
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Old 02-10-2011, 03:06 PM   #128
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A few pages back there was a post about means testing... here is a few things to think about... I am not an expert in government taxation and appropriation, but feel free to correct any assumptions made by me...


Payroll taxes... 6.2% goes to SS
another chunk goes to federal income tax...

the company writers ONE CHECK and pays it all as taxes

then someone in gobernmunt land puts 6.2% into one budget and the balance into another budget. <---- this is my point of emphasis

once per year, this is verified when people file their tax returns with the IRS.

If the "means test" is forced on at the tax return level, did that really help the system stay solvent? It does indirectly, but all money from federal tax returns goes back into IRS, does the IRS kick the portion of SS tax back to the SS administration (budget) or just allocate that money back to a general fund.

The most likely means test, IMO, would be to cut problem off before tax return is filed, so when the SS administration reports "surplus" vs "deficit" it is a bottom line calculation (meaning spent less than taxes collected based on 6.2% payroll tax).
I'm somewhat confused by your example because I've assumed the means test we're talking about is when benefits are payable, not when taxes are paid. But it seems we should be able to agree on some basics -

The original political agreement re SS was that SS taxes would be enough to pay SS benefits, and would only be used to pay SS benefits. This is similar to the way they set up the gasoline tax to pay for highway construction. In both cases, someone has a spreadsheet that keeps track of both taxes paid and spending. If there's a surplus in one year it's carried forward to the next where it's available to offset a possible shortfall.

As MB says, the headline "deficit" number is for the whole gov't, most news reports don't break it out for programs with dedicated taxes. But, the headline "debt" number is usually quoted for the general fund only, treating SS as a separate entity. I know that's grossly inconsistent, but that's what I see on the news programs I watch.

The FIT collected on SS benefits goes onto the SS side of the worksheet, not the general fund side. I know that's odd, but it's one of those political compromises. So, IMO, the FIT on SS benefits is truly a hidden means test based on current taxable income.

When they raised SS taxes back in the 80's, they expected to build up a modest surplus in the SS columns of the worksheet, and thought they would have been burned off by 2011. Surprisingly, they got 20+ years of positives, so there's $2+ trillion accumulated there today (but of course the GF side of the spreadsheet has a $14 trillion shortage).
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Old 02-10-2011, 03:16 PM   #129
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Hello Patrick - I consider myself "wealthy" and I would have no problem being more taxed / more means tested ONLY IF it means the creation of more meaningful, concrete social programs for the ones in need. I would have no problem either paying 10%-20% more in income tax if it helps the creation of a true universal healthcare program.
Perhaps people of modest means such as Patrick and myself should pay no addtional taxes but people of more significant means, such as yourself, should pay 50% - 60% more tax. Having a progressive tax system makes a lot of sense, especially if the higher rates come into play for folks above me in income/wealth.

I agree with you that higher taxes would be more tolerable if something concrete took place as a result of the increased gov't spending. I know I'm jaded. I live in Illinois. Our recent 67% state income tax increase is already being pounced on by Machine politicians and public worker unions as simply a golden egg to pay for current services with little new or of substance being provided.....
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Old 02-10-2011, 03:19 PM   #130
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I'm somewhat confused by your example because I've assumed the means test we're talking about is when benefits are payable, not when taxes are paid. But it seems we should be able to agree on some basics -

The original political agreement re SS was that SS taxes would be enough to pay SS benefits, and would only be used to pay SS benefits. This is similar to the way they set up the gasoline tax to pay for highway construction. In both cases, someone has a spreadsheet that keeps track of both taxes paid and spending. If there's a surplus in one year it's carried forward to the next where it's available to offset a possible shortfall.

As MB says, the headline "deficit" number is for the whole gov't, most news reports don't break it out for programs with dedicated taxes. But, the headline "debt" number is usually quoted for the general fund only, treating SS as a separate entity. I know that's grossly inconsistent, but that's what I see on the news programs I watch.

The FIT collected on SS benefits goes onto the SS side of the worksheet, not the general fund side. I know that's odd, but it's one of those political compromises. So, IMO, the FIT on SS benefits is truly a hidden means test based on current taxable income.

When they raised SS taxes back in the 80's, they expected to build up a modest surplus in the SS columns of the worksheet, and thought they would have been burned off by 2011. Surprisingly, they got 20+ years of positives, so there's $2+ trillion accumulated there today (but of course the GF side of the spreadsheet has a $14 trillion shortage).
The current SS means test does not reduce SS checks, it increases the tax paid on April 15. Everyone gets the checks, and come tax time, the tax system resolves if the person owes more tax.

My post which you responded to was more along lines of, if you pay tax to the IRS April 15, are the government accountants good enough to make sure they allocate the proper tax paid back to SS system (to prove its solvency)?
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Old 02-10-2011, 03:31 PM   #131
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I wonder what percent of our government expenses in medicare and other entitlements programs are exacerbated by fraud that goes on? Just here locally the television reported on hundreds of thousands of dollars by one person alone. I've read private insurance companies are way better at catching this than the government seems to be.
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Old 02-10-2011, 04:02 PM   #132
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Hello Patrick - I consider myself "wealthy" and I would have no problem being more taxed / more means tested ONLY IF it means the creation of more meaningful, concrete social programs for the ones in need. I would have no problem either paying 10%-20% more in income tax if it helps the creation of a true universal healthcare program.
Do me a favor, keep it down. Someone in power may read this and rip us off for more money. If you think there is any chance that our government will do the right thing with our money, well......
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Old 02-10-2011, 04:10 PM   #133
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Hello Patrick - I consider myself "wealthy" and I would have no problem being more taxed / more means tested ONLY IF it means the creation of more meaningful, concrete social programs for the ones in need. I would have no problem either paying 10%-20% more in income tax if it helps the creation of a true universal healthcare program.
If you want to pay more taxes then you have my blessing.

Usually it's more like this...

I consider you "wealthy" and I would have no problem with you being more taxed / more means tested to create more social programs for the well connected. I have no problem with you paying as a minimum 10%-20% more in income tax.
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Old 02-10-2011, 06:53 PM   #134
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Thank you MasterBlaster. Point well taken.

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I consider you "wealthy" and I would have no problem with you being more taxed / more means tested to create more social programs for the well connected. I have no problem with you paying as a minimum 10%-20% more in income tax.
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Old 02-10-2011, 07:46 PM   #135
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My answer may surprise you, youbet : I totally agree with you.

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(...)people of more significant means, such as yourself, should pay 50% - 60% more tax. Having a progressive tax system makes a lot of sense, especially if the higher rates come into play for folks above me in income/wealth.
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Old 02-11-2011, 09:45 AM   #136
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Old 02-11-2011, 10:08 AM   #137
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The current SS means test does not reduce SS checks, it increases the tax paid on April 15. Everyone gets the checks, and come tax time, the tax system resolves if the person owes more tax.

My post which you responded to was more along lines of, if you pay tax to the IRS April 15, are the government accountants good enough to make sure they allocate the proper tax paid back to SS system (to prove its solvency)?
I hope I said "yes", though it would be more correct to say "pretty much, some of it goes to Medicare instead".

You can see the "Taxation of Benefits" column in table A1 here 2010 Trustees Report: Section IV.A, Short-range estimates so it's clear that some money is getting into the SS account.

There's a careful history here Research Notes & Special Studies by the Historian's Office
The 83 amendments set up the tax and sent it to the SS side of the worksheet. The 93 amendment increased the tax and sent the increase to the Medicare columns.
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Old 02-11-2011, 11:57 AM   #138
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My answer may surprise you, youbet : I totally agree with you.
It does surprise me to an extent. Most people hypocritically want folks with "more" than them to pay "more" taxes but wish they themselves could pay less. Folks recognizing they're well off compared to the huddled masses and being willing to transfer some of their wealth to the masses are rare. Good for you! I like say-do people.
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Old 02-12-2011, 11:52 AM   #139
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At age 66 I have not applied for SS yet and do not plan on doing so for about 3-4 years when I approach age 70. DW on the other hand recently opted in at age 62 under her limited work history and WEP/GPO issues. I will soon apply for my spousal benefits under her record and continue to let my stash grow at an 8% rate. If I live long enough I can job the system.

If I croak too soon, the USA will have won the race and my fellow Americans will receive the benefit of my early demise (as well as DW). I like my chances.

Of course if Congress changes the rules, my plan may falter, but I'm positive that Congress will not screw me.
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