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April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review July 5, 2007 / 19 Tamuz, 5767

Billionaire Warren Buffett — a case of the guilts?

By Larry Elder


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http://www.JewishWorldReview.com | Whatever happened to Warren Buffett, the world's third-richest man? Guilt, a feeling of being blessed by luck, forgotten lessons — who knows? In any case, Buffett now believes that government should redistribute the wealth earned by others to those who did not earn it.


"Buffett Blasts System That Lets Him Pay Less Tax Than Secretary" blared a recent headline. Huh?


At a Hillary Rodham Clinton fundraiser speech before 400 movers and shakers, Buffett denounced our tax system. According to Buffett, he pays taxes at a lower tax rate than does his $60,000-a-year secretary, 17.7 percent and 30 percent, respectively. But Buffett has long been sympathetic toward big government. Buffett joined the informal "advisory board" of then California gubernatorial candidate Arnold Schwarzenegger, who became governor because his predecessor tripled the car tax. Incredibly, Buffett promptly urged an increase in California property taxes. Buffett also opposes repeal of the estate tax, considering it unfair for generation after generation to retain wealth, presumably preventing those in the lower classes (where he came from) from rising up.


But let's examine the assertion that Buffett pays a higher tax rate than does his secretary.


Buffett says he earned $46 million in 2006, with a tax rate of 17.7 percent — all, says Buffet, without attempting to avoid paying higher taxes. But his income clearly places him in the highest federal income tax bracket — 35 percent — but the same "non-avoidance" tax rules allow ample deductions and credits. Surely a man like Buffet can claim buckets-full, to say nothing of possible business losses and capital gains inherent in his line of work. So he probably reached the 17.7 percent rate without any monkey business. Fair enough. Whip out your calculator. First, Buffett, on his $46 million a year, paid — at his 17.7 percent rate — over $8 million in taxes.


Now let's deal with his secretary, whom he claims pays his or her taxes at a 30 percent rate. Buffett, in his speech, provided no details about the secretary. But even with minimal deductions, the highest possible federal tax bracket for a single person earning $60,000 a year is 25 percent. We don't know whether Buffett's secretary is married, a homeowner or renter, or has children.


Let's suppose Buffett's secretary is a single person, a renter, no kids, and makes no IRA contribution (or any other gross income adjustments) and claims the standard deductions. This scenario places the secretary in the highest possible income tax bracket. But after the standard deduction ($5,150) and one personal exemption ($3,300), the secretary's taxable income becomes $51,550 — the 25 percent tax bracket. This means the secretary pays $9,439 in taxes — or 15.7 percent of the $60,000 annual income. Assuming the secretary lives in Nebraska (where Buffett is headquartered), with its highest income tax bracket at 6.84 percent, the secretary pays $2,663 to the state, or another 4.4 percent of the $60,000. Altogether, this gives the secretary a total tax rate of 20.1 percent.


Throw in one kid under 17 years of age, and a $4,000 contribution to an IRA, and this single parent secretary — still renting and claiming the standard deduction — now has a taxable income of $41,850. With one child tax credit, secretary pays $4,814 in federal income taxes, just 8 percent of the $60,000-per-year income. Single-parent secretary also pays $2,076 in income taxes to Nebraska, for a total of 11.5 percent of the $60,000 per year annual income.


Now suppose we're talking about a married secretary, with a stay-at-home spouse. They file jointly, pay a home mortgage and have two kids under the age of 17. They place $4,000 in an IRA and itemize $15,000 in deductions. Here the tax picture changes dramatically. Taxable income drops to $27,800 — the 15 percent tax bracket. With child tax credits, secretary now pays $1,419 in federal taxes, or 2.4 percent of $60,000. Add in another 2 percent for $1,218 in state taxes, and secretary pays a grand total, state and federal, of 4.4 percent on the $60,000-a-year salary.


An online search of Buffett's comments found not a single news story (as opposed to an editorial) questioning his assertion that he pays a higher tax rate than does his secretary.


During his speech, Buffett also explained why he became a Democrat. Republicans, he says, think, "I'm making $80 million a year. God must have intended me to have a lower tax rate." Interesting. Does Buffett know that Republicans donate more money to charity than do Democrats? In his book "Who Really Cares," author Arthur Brooks explains why. Republicans believe in limited government, and therefore feel the responsibility to help the needy falls on their shoulders. Additionally, the Republican Party contains more religious people than the Democratic Party, and the religious give more than their non-religious counterparts.


Maybe G-d wants lower income tax brackets in order to provide more disposable income. That way people can — as Buffett does — give more to the needy.

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JWR contributor Larry Elder is the author of, most recently, "Showdown: Confronting Bias, Lies and the Special Interests That Divide America." (Proceeds from sales help fund JWR) Let him know what you think of his column by clicking here.

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© 2006, Creators Syndicate

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