Comments on: Advice to President Obama’s Deficit Commission: Tax Social Security Payments http://blog.oup.com/2010/09/social-security/ Academic insights for the thinking world. Fri, 17 May 2013 12:26:42 +0000 hourly 1 http://wordpress.org/?v=3.4.2 By: Bill Parks http://blog.oup.com/2010/09/social-security/#comment-181408 Bill Parks Mon, 11 Oct 2010 23:52:20 +0000 http://blog.oup.com/?p=11073#comment-181408 Social security taxes were set up to provide more than just an old age pension and the amounts paid out to the individual are more heavily weighted towards the poor that worked at lower wages. The caps on contributions are illogical. If one makes $100,000 per year, one receives less per dollar of contribution than a person that makes only $25,000 per year. Unless you subscribe to throwing the poor under the bus and letting them sleep under a bridge, it makes sense to remove the cap on taxed earnings. That would put more of the burden on those that can most afford it. It would be even fairer to tax all income and lower the rates on wage earners. Social security taxes were set up to provide more than just an old age pension and the amounts paid out to the individual are more heavily weighted towards the poor that worked at lower wages. The caps on contributions are illogical. If one makes $100,000 per year, one receives less per dollar of contribution than a person that makes only $25,000 per year. Unless you subscribe to throwing the poor under the bus and letting them sleep under a bridge, it makes sense to remove the cap on taxed earnings. That would put more of the burden on those that can most afford it. It would be even fairer to tax all income and lower the rates on wage earners.

]]> By: Royce Miller http://blog.oup.com/2010/09/social-security/#comment-176124 Royce Miller Sat, 25 Sep 2010 20:17:29 +0000 http://blog.oup.com/?p=11073#comment-176124 85% of my Social Security is taxed already regardless of whether I have recovered my contributions or not. My contributions were subject to income tax when paid in (FICA tax is not deductible for income tax purposes). This is double taxation as I see it, and was part of the Clinton tax increases. The Congress giveth and the Congress taketh away! 85% of my Social Security is taxed already regardless of whether I have recovered my contributions or not. My contributions were subject to income tax when paid in (FICA tax is not deductible for income tax purposes). This is double taxation as I see it, and was part of the Clinton tax increases.

The Congress giveth and the Congress taketh away!

]]> By: AndrewDover http://blog.oup.com/2010/09/social-security/#comment-174272 AndrewDover Sun, 19 Sep 2010 15:41:15 +0000 http://blog.oup.com/?p=11073#comment-174272 This just makes sense. After all, social security contributions are tax deferred already. And we should be looking at simplification of the tax forms also. The alternative minimum tax could be removed, and all deductions should be reformulated as tax credits at 20% of the amount too. In that way everybody would get the same subsidy for a dollar of mortgage interest instead of the rich getting more subsidy than the poor! This just makes sense. After all, social security contributions are tax deferred already.

And we should be looking at simplification of the tax forms also. The alternative minimum tax could be removed, and all deductions should be reformulated as tax credits at 20% of the amount too. In that way everybody would get the same subsidy for a dollar of mortgage interest instead of the rich getting more subsidy than the poor!

]]> By: Tim http://blog.oup.com/2010/09/social-security/#comment-173094 Tim Fri, 10 Sep 2010 20:34:54 +0000 http://blog.oup.com/?p=11073#comment-173094 What a horrible idea. I understand where you are trying to go in calculating the basis, and 'taxing' the payments after the basis is returned. But comparing to the private pension or 401(k) system is a poor comparison. With the private pension system, there is some expection of growth over the long term. So you may retire with $500k in your plan, but your basis might only be $100k. It's comparing apples to apples. Social Security should be completely disbanded. It is beyond repair at this point and the only way to 'save' it is to add to our already overburdened tax system significantly. And that will be much too painful for our eoncomy in the long term. What a horrible idea. I understand where you are trying to go in calculating the basis, and ‘taxing’ the payments after the basis is returned. But comparing to the private pension or 401(k) system is a poor comparison. With the private pension system, there is some expection of growth over the long term. So you may retire with $500k in your plan, but your basis might only be $100k. It’s comparing apples to apples. Social Security should be completely disbanded. It is beyond repair at this point and the only way to ‘save’ it is to add to our already overburdened tax system significantly. And that will be much too painful for our eoncomy in the long term.

]]> By: bigjohn756 http://blog.oup.com/2010/09/social-security/#comment-172634 bigjohn756 Tue, 07 Sep 2010 20:11:27 +0000 http://blog.oup.com/?p=11073#comment-172634 Social Security is a FORCED pension. I never wanted it, but I had no choice. If I had been allowed to keep this money and invest it then it would have been worth a lot more than I'll ever get now. Social Security was an awful idea at the outset, and it's gotten much worse over the years. Putting that much money within the reach of politicians was pure folly. Taxing it would put a lot of people, who are struggling now, out on the street. Great idea Zelinsky! Social Security is a FORCED pension. I never wanted it, but I had no choice. If I had been allowed to keep this money and invest it then it would have been worth a lot more than I’ll ever get now. Social Security was an awful idea at the outset, and it’s gotten much worse over the years. Putting that much money within the reach of politicians was pure folly. Taxing it would put a lot of people, who are struggling now, out on the street. Great idea Zelinsky!

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