Tags: capital | gains | tax | dividend

Which Candidate's Tax Plan Is Better For You?

Friday, 10 Aug 2012 08:41 AM

By Bill Spetrino

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The election coming up in November is certainly the biggest of our lifetime.
I am a professional investor whose dividend income has exceeded my annual living expenses for almost eight years now.

Every stock in my conservative portfolio is near or much higher than when I recommended it, and my portfolio has averaged more than 30 percent annually compounded and was top-rated in 2011 in the low-risk category by Hulbert Financial Digest, a Dow Jones-owned company.

People naturally ask me which tax plan I like better from each presidential candidate. Now, I do not belong to a political party, but rather talk about the specific policies each candidate supports.

Editor's Note: Small-Town Ohio Accountant Uses Simple Forgotten Secret to Help Investors Pocket Millions

Today, I want to talk about the tax policies and you can make up your own mind.

One candidate wants to have dividends and capital gains taxed at 15 percent for folks who make less than $250,000 and between 37 and 43 percent for those who make more than $250,000.

The other candidate wants a 23 percent dividend and capital gains rate for those making more than $250,000 and 0 percent for those making under $250,000.

One candidate wants interest income taxed at 15 to 28 percent for those who make under $250,000 and 33 to 43 percent for incomes over $250,000.

The other wants interest income taxed at 0 percent for those making less than $250,000 and 23 percent for those making $250,000.

Which plan do you think helps middle-class families better?

One candidate wants an estate tax of 55 percent on any estate over $3 million, and the other wants no estate tax for anyone since you pay taxes all your life.

Does the government deserve to take 55 percent of what ANY person made and paid taxes on their entire life?

Warren Buffett and Bill Gates gave most of their fortunes to their foundations and paid zero taxes.

How about everyone pay a 5 percent estate tax on any estate over $3 million, whether given to charity or not?

One candidate wants a 35 percent tax on corporate earnings, the other wants 25 percent on corporations.

Now, I was an accountant before I became an investor.

Ernst & Young is one of the top accounting firms in the world and this is what they said about the effect of higher tax programs on jobs:

· Output in the long run would fall by 1.3 percent, or $200 billion, in today's economy.
· Employment in the long term would fall by 0.5 percent, or approximately 710,000 fewer jobs, in today's ‚Ä®economy.
· Capital stock and investment in the long run would fall by 1.4 percent and 2.4 percent, respectively.
· Real after-tax wages would fall by 1.8 percent, reflecting a decline in workers' living standards ‚Ä®relative to what would have occurred otherwise.

Editor's Note: Small-Town Ohio Accountant Uses Simple Forgotten Secret to Help Investors Pocket Millions

No matter what party or age you are, each voter invariably has to decide which America they want.

Presidents John Kennedy, Ronald Reagan, Bill Clinton and George W. Bush all cut the capital gains tax, and in the following two years, the U.S. Treasury receipts increased despite the lower capital-gains rate.

That's because investors like me decide when we take gains.

And 15 percent of something is higher than 0 percent of nothing.

In addition, Reagan, Clinton and Bush all cut capital gains taxes and Bush cut taxes for everyone across the board

Guess which of these three had the highest tax receipts during their eight years as president?

George W. Bush with his across the board tax cuts had the highest tax receipts.

Many in Washington in both parties don't like the facts interfering with a good but "untrue" story.

So are you about higher taxes and fewer jobs or lower taxes and more jobs?

About the Author: Bill Spetrino

Bill Spetrino is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He is also the editor of the Dividend Machine. Discover more by Clicking Here Now.

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