Saturday, July 3, 2010

What about the Drudge report piece on taxes that Chuck refers too

Drudge promoted Reuters article. Internet gossip Matt Drudge promoted the Reuters article on his Drudge Report website on February 2. Later that day, he updated his site to note that Reuters had "pull[ed]" the story.

Reuters baselessly links Obama budget plan to "backdoor taxes to hit middle-class" based on non-renewal of Bush tax cuts and AMT patch

Reuters: Under Obama budget plan, "middle-class families" will face "backdoor [tax] increases." From the February 1 Reuters article:
The Obama administration's plan to cut more than $1 trillion from the deficit over the next decade relies heavily on so-called backdoor tax increases that will result in a bigger tax bill for middle-class families.
In the 2010 budget tabled by President Barack Obama on Monday, the White House wants to let billions of dollars in tax breaks expire by the end of the year -- effectively a tax hike by stealth.
While the administration is focusing its proposal on eliminating tax breaks for individuals who earn $250,000 a year or more, middle-class families will face a slew of these backdoor increases.
As evidence, Reuters cites middle class tax increases if Bush tax cuts allowed to expire. From the article:
If the provisions are allowed to expire on December 31, the top-tier personal income tax rate will rise to 39.6 percent from 35 percent. But lower-income families will pay more as well: the 25 percent tax bracket will revert back to 28 percent; the 28 percent bracket will increase to 31 percent; and the 33 percent bracket will increase to 36 percent. The special 10 percent bracket is eliminated.
Reuters also cites "millions of middle-class households" facing higher taxes if patch to limit the impact of AMT not renewed. The article notes that if the patch that limited the impact of the alternative minimum tax is not renewed, "the tax will hit American families" with "incomes as low as $33,750":
Without annual legislation to renew the patch this year, the AMT could affect an estimated 25 million taxpayers with incomes as low as $33,750 (or $45,000 for joint filers). Even if the patch is extended to last year's levels, the tax will hit American families that can hardly be considered wealthy -- the AMT exemption for 2009 was $46,700 for singles and $70,950 for married couples filing jointly.
Reuters article has been withdrawn. On February 2, Reuters replaced the article with following advisory: "The story Backdoor taxes to hit middle class has been withdrawn. A replacement story will run later in the week."

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