I have had through the years a large number of immigrants in my practice who worked very hard. Many saved the money to start businesses and have done extremely well financially. By the way, Elon Musk is such an immigrant.
One uneducated immigrant went to work cleaning a Catholic high school downtown and later started her own janitorial company. Another immigrant I know trained as a mechanic at Delta without any college and is making $200,000 a year supervising aircraft maintenance by a contractor in El Salvador.
Hard work and initiative still pays off in the USA. That is why so many people still wish to immigrate to this country. Meanwhile, many native-born Americans lament that there is no social mobility.
The ITC went away in 1981 I think. My father needed the tax deduction so bought the dental equipment for my first office and then leased it to me. I had no income at the time. The purpose was to get businesses to invest in upgraded capital equipment during an inflationary time. You have to remember what a bad time the late 1970s was.
It’s not always apples to apples. For example, things that were deducted back then that are not deductible today:
State excise Taxes
State Gasoline Taxes
“Deductions were allowed for “personal” interest, Federal excise taxes, taxes paid to State and local governments, casualty or theft losses, and business expenses.”
A deduction for unusually large medical expenses was introduced for 1942
“An “income-splitting” concept was intro-duced for 1948 for married couples, permit-ting them to treat their joint incomes as half earned by each spouse and taxed as if each spouse were taxed separately, usually resulting in a lower combined tax.”
Unemployment compensation was not taxabe until 1979
Social Security benefits were not taxable until 1984 (increased significantly in 1994)
Deductions for “personal” interest and mortgage real estate loan interest were limited, and those for investment interest could only be applied against investment income, starting with 1987. In otherwords, these things were deductions.
Passive losses were deductible
Sales taxes were deductible and were done away with in the 1987 changes
Personal Insurances were deductible. This was in the 1990s only allowing corporate insurance deductions
“In addition, for 1948 through 1986, extra personal exemptions were allowed for taxpayer(s)
who were elderly or blind. Starting with 1987, these latter exemptions were replaced by additional “stan-dard deductions” for these individuals”
Mortgage interest was deductible back then
Also, “Tax was collected at the source in the case of salaries and wages, interest, rents, and annuities, with an exemption of $3,000 for single persons and $4,000 for married couples”
We have to make sure we’re discussing apples to apples. Yes, taxes were higher, much more things were deductible.
You might want to weigh in with your Members of Congress on this Bill:
Washington, D.C.- Representative Thomas Massie (R-KY) announces reintroduction of the Senior Citizens Tax Elimination Act, H.R. 1040 . This bill assists middle-class seniors by eliminating the unjust double tax on Social Security benefits.
As the Congressional Research Service reports, “Before 1984, Social Security benefits were exempt from the federal income tax. Congress then enacted legislation to tax a portion of those benefits, with the share gradually increasing as a person’s income rose above a specified income threshold.”
So the Bill would simply restore the tax policy to pre-1984 levels.
If every SS recipient stopped paying taxes on their SS check and the check was $2,000 a month it would add another $21 billion a year to our national debt.
I’m in favor of finding spending cuts to offset this because the return you get for being forced to loan the government your money is so bad.
I just looked at my social security statement. If I retire in a few years at 62, it would take me 11.4 years for the measly monthly payment I would get to pay back all the money my employers and I contributed with a 0% return. If they money were adjusted for inflation, I’m guessing it would take 15-20 years to get a true 0% return.
If I had invested that same money each year, I would have a very comfortable amount of retirement money: ~$2.5 million (assuming 8% annual return).
The least they could do is not tax what you manage to get back, almost certainly pennies on the dollar.
You’ll get a tax break on your SS income, at least 15% will not be taxed, but who’s gonna cover the deficit you create by not paying tax on 85% of your SS income?
Why doesn’t the government have a massive pile of money from me/employer’s contributions compounding interest over all those years? Because they spent my_money on other domestic entitlement programs or pissed it away overseas (i.e. fraud/waste/abuse).
When you ask AI why Ponzi schemes ultimately fail, this is the top reason:
One major reason is that they rely on a constant influx of new investors to pay returns to existing ones. When the number of new investors slows down or stops, the scheme cannot sustain itself, leading to its collapse
Open Secret: for most people, there was no income tax on labor before the “Temporary WWII Tax” was sold on unsuspecting American workers as a Patriotic duty. Suckers.