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Old Nov 8, 2012, 04:27 PM   #51
citizenzen
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But I have no doubts many small businesses are looking at their bottom lines and reevaluating headcount with the new tax burdens going into 2013 and beyond and making adjustments.
What are these new tax burdens?

Could someone please quantify this?
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Old Nov 8, 2012, 04:28 PM   #52
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So the Republicans are the problem?

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Old Nov 8, 2012, 04:30 PM   #53
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How many budgets were passed when the Dems had the White House, Senate and the House?
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Old Nov 8, 2012, 04:35 PM   #54
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How many budgets were passed when the Dems had the White House, Senate and the House?
Please read the whole article ..... http://www.liveleak.com/view?i=4e5_1...012&comments=1


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Democrats had a 60 seat majority from September 24, 2009 thru February 4, 2010. 4 months; not 2 years!!
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Old Nov 8, 2012, 04:39 PM   #55
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What are these new tax burdens?

Could someone please quantify this?
Here you go
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If President Barack Obama is given a second term, one vitally important group of taxpayers—small employers—will face five key tax increases:
1. Income tax increase. A pillar of President Obama’s re-election campaign is a hike in the top two marginal income tax rates. By and large, small employers pay their small business taxes using individual tax rates. If individual tax rates are raised, so are small business tax rates. The top income tax rate is scheduled to rise from 35 percent in 2012 to 39.6 percent in 2013. According to IRS data, a clear majority of all small business profits face taxation at this top marginal income tax rate. For all intents and purposes, the top income tax rate IS the small business tax rate in America today.

President Obama and congressional Democrats claim they are raising taxes on “millionaires and billionaires” but are actually targeting successful small companies. A new study by Ernst and Young projects that this tax rate hike will kill 710,000 small business jobs.

2. Death Tax Increase. The death tax in 2012 has a top rate of 35 percent, and a “standard deduction” of $5 million ($10 million in the case of a married couple or surviving spouse). President Obama’s plan proposes raising the rate to 45 percent and slashing the exemption to $3.5 million.

When a family business owner dies, it’s up to the surviving family members to pay the death tax to the government. Needless to say, many successful, job-creating small businesses simply won’t survive this process. Such families will have little choice but to sell the business (and lay off all the employees) in order to pay the IRS. Or they will have to pay a small fortune to lawyers, accountants, and the life insurance industry to avoid this fate.

3. ObamaCare self-employment tax rate increase. Currently, successful small business owners face a self-employment tax of 2.9 percent. Thanks to ObamaCare’s 2013 hike in this tax rate, this will rise to 3.8 percent. All told, the combination of the income tax hike and the self-employment tax hike will raise the marginal income tax rate on small business profits from about 38 percent today to about 43 percent in 2013. That extra five percentage points might not sound like a lot, but most small employers have very thin profit margins. A company with $1 million in profits facing a higher tax rate of 5 percentage points will be saddled with another $50,000 in taxes.

4. ObamaCare Medical Device Tax: Taking effect in 2013, this 2.3 percent tax on companies making devices such as prosthetic limbs, pacemakers, and operating tables is particularly destructive because it is levied on gross sales, even if the respective company doesn’t earn a profit in a given year. The industry employs 409,000 Americans in 12,000 plants across the country, and many incur a loss for several years as they pioneer the next generation of life-improving devices.

This looming $20 billion tax is already causing small business job loss and cuts to research and development budgets. Even liberal Democratic Massachusetts Senate candidate Elizabeth Warren knows the medical device tax is destructive to small business. She wrote an op-ed in opposition to the tax, saying: “When Congress taxes the sale of a specific product through an excise tax, as the Affordable Care Act does with medical devices, it too often disproportionately impacts the small companies with the narrowest financial margins and the broadest innovative potential. It also pushes companies of all sizes to cut back on research and development for life-saving product.”

Eighty percent of device companies have fewer than 50 employees, according to the Medical Device Manufacturers Association. Many of these small businesses are located in electoral swing states such as Ohio, Wisconsin, Florida, and New Hampshire.

5. ObamaCare Investment Surtax: Also taking effect in 2013, this tax increase captures those few small business owners not covered by the self-employment tax hike: owners of Subchapter-S corporations and limited partners. These owners are currently exempt from self-employment tax, mostly because they are investors rather than proprietors. But ObamaCare sweeps them into the IRS net too, forcing them to pay the 3.8 percentage point tax as an “investor surtax.” This will make it far more difficult for investors to raise money to start up small firms. An investor is going to need to see even greater small business profit projections to overcome this higher “hurdle rate” of taxes. Not only does a small business owner have to give his investor a strong return on his investment, he now has to do it with a giant tax mill around his neck.
These five tax increases only begin to scratch the surface. Small employers are also facing the ObamaCare employer mandate tax penalty starting in 2014. This tax provision will force small businesses with more than 50 employees to purchase “qualifying” health insurance, or else face a tax of up to $2,000 per employee.

In taxes, a truism is that if you want less of something, you tax it more. Whether he realizes it or not, President Obama’s tax policies will result in fewer and less successful small businesses, fewer small business jobs, fewer family businesses that can be passed along from parents to children, fewer medical device manufacturing jobs, and much less investment in small employer start-ups.


Read more: http://www.foxnews.com/opinion/2012/...#ixzz2BfZpEsjr
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Old Nov 8, 2012, 04:45 PM   #56
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Please read the whole article ..... http://www.liveleak.com/view?i=4e5_1...012&comments=1
Since when do you need a super majority to pass a budget? Budgets need only a simply majority to pass and cannot be blocked by filibuster in the Senate.
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Old Nov 8, 2012, 04:46 PM   #57
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Here you go
I'll check it out.

I can't devote my full attention to that as I'm at work.

I'm a little leery about the source though.

Does anybody have anything from something more reputable?
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Old Nov 8, 2012, 04:49 PM   #58
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Here you go
Ok, so if I own a "small business" and elect to operate it as a Partnership, Limited Liability Partnership, LLC or S-Corp, I'm somehow getting "screwed" because these taxes are going up?

Do you not understand that none of those entities are taxed at the entity level? They are already getting a MASSIVE tax break! I'll tell you what, we should just eliminate the partnership taxation treatment of all entities except general partnerships. I bet if we did that, all these small businesses that are complaining would change their tune.

(edit) Oh, and most of those tax increases were included in the original tax cut laws (some were extended), but the point is that these aren't tax increases being proposed by Obama, but that were passed by Republicans when they had the white house and congress.
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Old Nov 8, 2012, 04:54 PM   #59
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So the Republicans are the problem? Yet if Romney had won it still wouldn't get passed? Wouldn't you then conclude that the problem lies on both sides of the aisle?
problem you run into is the GOP will only accept cuts to things the dems would never agree to. Case and point look at their response to dealing with cuts to military spending, it id double down on cuts to things like medicare.

Or the that the GOP demanded extension to the bush tax cuts so unemployment benefits would not be defunded.

The GOP has yet to even try to compromise. They have been give us everything we want and them some. Come back to me when the GOP really does compromise.
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Old Nov 8, 2012, 04:54 PM   #60
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I'll check it out.

I can't devote my full attention to that as I'm at work.

I'm a little leery about the source though.

Does anybody have anything from something more reputable?
Here are the general principals from the Washington Post.

The tax rate increase from 35 to 39% is what it is. How many small businesses are affected is heavily debated.

The Obamacare issue is much more vague. We don't know how much it will cost the average small business and probably won't until 2014. What this guy in Nevada was likely doing and what a lot of businesses are considering is getting under the 50 employee soft cap at which point you are not subject to penalties.
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Old Nov 8, 2012, 04:56 PM   #61
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Since when do you need a super majority to pass a budget? Budgets need only a simply majority to pass and cannot be blocked by filibuster in the Senate.
http://www.economist.com/blogs/freee...tary-procedure
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Old Nov 8, 2012, 05:01 PM   #62
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problem you run into is the GOP will only accept cuts to things the dems would never agree to. Case and point look at their response to dealing with cuts to military spending, it id double down on cuts to things like medicare.

Or the that the GOP demanded extension to the bush tax cuts so unemployment benefits would not be defunded.

The GOP has yet to even try to compromise. They have been give us everything we want and them some. Come back to me when the GOP really does compromise.
Compromise is a two-way street. If one party gives in, that is not compromise.
If the Democrats were really serious about getting a budget passed, they would. They had two years with a stacked deck and didn't get a budget passed.
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Old Nov 8, 2012, 05:04 PM   #63
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Compromise is a two-way street. If one party gives in, that is not compromise.
If the Democrats were really serious about getting a budget passed, they would. They had two years with a stacked deck and didn't get a budget passed.
Source?
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Old Nov 8, 2012, 05:05 PM   #64
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I'm a little leery about the source though.
"Death Tax"?
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Old Nov 8, 2012, 05:07 PM   #65
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From your link:
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So yes, the Senate could pass a budget resolution, but without the cooperation of the house or 60 votes, that resolution would not take effect; it would be an empty gesture. The fact that the House managed to pass a budget last year, including a major overhaul of Medicare, reflects its different rules that allow it to deem the budget resolution to have taken effect. But it didn't ultimately matter: the provisions in its budget, including the Medicare changes, were not binding on the Senate.
Notice it says you need one of two things; the cooperation of the house OR 60 votes in the Senate.

It was MUCH harder to get Obamacare passed than it would have been to pass a budget. The Democrats didn't care to pass a budget or they would have done so.

----------

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Source?
A source for what? Would you like a source that Democrats controlled the House, Senate and White House for the first two years of Obama's term?
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Old Nov 8, 2012, 05:11 PM   #66
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A source for what?
That they didn't pass a budget.
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Old Nov 8, 2012, 05:14 PM   #67
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Notepie, can you explain why/how Obamacare is the make or break issue here?

That's what I'd really like to know ... why it specifically is the straw that is [allegedly] breaking the camels back.
Its not the straw but its one straw.

The cost of providing healthcare is a huge barrier for small businesses. Among small businesses that offer coverage, 40 percent spend more than 10 percent of their payroll on health care costs. This affects a broad subset of Americans — of the 30 million uninsured Americans now covered, nearly one-third (13 million people) are employees of business with fewer than 100 workers.
Companies with fewer than 50 employees do not have to provide insurance, but the new law will make it easier and cheaper if they do.

Businesses with 50 or more employees must provide health insurance or pay a penalty. If the business fails to comply, the penalty is $2,000 for each full-time employee (with a 30-employee deduction.) Additionally, if the coverage offered is too expensive (defined as costing more than 9.5 percent of the employee’s household income), the penalty is $3,000 per employee who must buy insurance with a government subsidy. However, only 200,000 small businesses will be affected by these changes because over 96 percent of small businesses fall below the 50-employee threshold.

http://www.forbes.com/sites/groupthi...ll-businesses/

The 200k Companies (mentioned in article) are going to down size to 49 or less, and use more part time labor.
The other 96% below the 50 threshold aren't going to help the worker anyway.

Somebody said Nevada's unemployment rate is getting better, that's just blowing sunshine

Nevada, which has six electoral votes, continues to have the highest unemployment rate in the country at 11.8% in September. That's an improvement from August when its rate was 12.1%, but the decline was due to a combination of both positive and negative developments. Nevada is seeing modest job growth but like Ohio, its labor force is also shrinking, and like Florida, it has yet to recover most of the construction jobs lost in the financial crisis

http://money.cnn.com/2012/10/19/news...tes/index.html
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Old Nov 8, 2012, 05:25 PM   #68
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In states that were overbuilding, like Nevada and Florida (maybe Arizona too?), you won't see a high amount of construction jobs anytime soon.
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Old Nov 8, 2012, 05:28 PM   #69
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That they didn't pass a budget.
I stand corrected. The Senate passed a budget in Obama's first 100 days on April 29, 2009. That was only 3 1/2 years ago.
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Old Nov 8, 2012, 05:46 PM   #70
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I stand corrected. The Senate passed a budget in Obama's first 100 days on April 29, 2009. That was only 3 1/2 years ago.
and after that point they no longer had a lock on 60 votes. It made it rather impossible to passed another one.

Also the dems never truly had 60 votes. 2 independents and then they had a few that I think were sick quite a bit. That makes it kind of hard to get to 60 votes to block a GOP filibuster.
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Old Nov 8, 2012, 05:51 PM   #71
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and after that point they no longer had a lock on 60 votes. It made it rather impossible to passed another one.

Also the dems never truly had 60 votes. 2 independents and then they had a few that I think were sick quite a bit. That makes it kind of hard to get to 60 votes to block a GOP filibuster.
See the post a few up. You don't need a super majority if you also hold a simple majority in the house.
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Old Nov 8, 2012, 05:59 PM   #72
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Putting aside the rationale behind these layoffs for a second...what do companies think is going to happen if they start laying off tons of people in order to skirt ACA requirements? Do they think their employees are going to turn on Obama and join the tea party?

Unlikely. It's far more probable that it will deepen their existing belief that business cares for naught other than itself. A rolling list of companies dropping employees via the Obamacare excuse could very well find themselves priming a whole new generation of liberals. And that would surely end up working against business' interests, electorally speaking. Cut off nose, spite face.

As to the particulars of the ACA, here's another view:

Quote:
So is defeat (of the attempt to stop the ACA via the Supreme Court) a disaster for small business? Almost certainly not, though it may prove to be a disaster for NFIB’s main policy priority of low taxes.

The bill in fact contains substantial benefits (some might even say giveaways) for small businesses. That starts with a program already under way to offer special subsidies to firms with fewer than 25 employees that want to offer health benefits. As long as your employees earn less than $50,000 on average (law firms, medical practices, and other elite professional partnership are thus ineligible), you can get a tax credit to defray 35 percent of the cost of the insurance if you’re a for-profit firm, and 25 percent if you’re a nonprofit. When the law really gets rolling in 2014, those subsidies rise to 50 percent for for-profits and 35 percent for nonprofits.

Firms with fewer than 50 employees are also exempt from the “employer responsibility” provision of the law that otherwise constitutes the biggest business burden in the legislation.The Affordable Care Act (in)famously requires that all individuals who don’t receive insurance from their employer or from a government program such as Medicare or Medicaid must buy their own insurance on a regulated exchange. Subsidies will be provided to those for whom such insurance wouldn’t be affordable. That could be seen as, in effect, penalizing firms that already offer insurance to their workers. To offset this, the law stipulates that companies whose employees receive subsidies to buy exchange plans must pay a financial penalty. That is supposed to deter firms from responding to the law by simply dropping existing insurance coverage. But the ACA doesn’t make small businesses pay that penalty.

Put the special subsidies and the exemption together, and the result is a law that’s pretty clearly a good deal for small businesses.
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Old Nov 8, 2012, 06:07 PM   #73
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there might be some posturing now, but in the end companies by and large will do what they always did and always will do: what is best for their business.

if the economy keeps growing, they will hire more.
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Old Nov 8, 2012, 10:25 PM   #74
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As to the particulars of the ACA, here's another view:
I wish some of these things were slightly more stratified so as to minimize unintended consequences around the change in conditions, in this case the $50k mark on employee salaries.



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I don't think so. Now we know that Obamacare is for sure and companies will take action to limit their overhead to compensate.

and it looks like Boeing is laying people off too but that is due to defense budget cuts.
There's a lot of noise right now, as is the case with any change in policy. We'll know the actual effects in the near future after some of the apprehension dies down. I mention noise as policy changes are frequently used to scapegoat things companies would have done anyway. It allows them to shift the bad PR away from themselves, so it's not always easy to discern which moves were strictly policy based. In terms of Boeing, the defense budget is unsustainable. Some of these companies have likely taken on too much weight as a result of spending levels in that area.

Regarding small businesses, they were very selective on information. If you're looking at LLC status, Sole Proprietorships, etc. it's taxed at an individual rate after operating expenses. This means if they're around the $250k mark, their tax would only be significantly offset above that amount. That portion of the tax adjustments shouldn't have much of a direct effect on businesses that are barely above that line. Also keep in mind that this would be assessed after expenses like employee healthcare. It's a later line item.

Right now I'm still slightly puzzled by what you dislike regarding cuts in defense spending. Anywhere you remove government spending, it will offset jobs in those areas. I'd prefer they keep it in check at all times. Otherwise you end up with inflated job levels in a given sector that aren't sustainable.


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This is a private employer. He doesn't need to justify why he is firing you. He can come in and tell 22 people your fired because I figured out I can continue to run my business at the same level or close to that level without you guys and I really want to buy that new Ferrari and take a nice vacation this year. Bye!
You're right in that he can manage his funds however he sees fit, which is why you shouldn't determine matters of policies by the whims of such individuals. The article referenced by the OP lacks some context (typical). Cutting that percentage of your staff would require more than a shift in tax brackets. He could be anticipating a drop in demand, but it seems plausible that he had too many people at the time and just decided to make a partisan excuse for something he would have done anyway. When someone provides highly selective details on this, it's impossible to treat it as a real case study.
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Old Nov 8, 2012, 11:35 PM   #75
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That had nothing to do with the election. The Dow Jones sell off was due to the announcement that the debt crisis is starting to affect Germany.

But nice spin.
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Germany slashes its forecast for 2013 GDP growth

The government partly blamed the lower growth on the eurozone's debt crisis


The German government has slashed its forecast for economic growth in 2013 from 1.6% to 1%.

:

German GDP grew 4.2% in 2010 and 3% in 2011.

Germany has benefited from the weaker euro, making its exports more competitive outside the eurozone.

"Although growth of 1% is weak in absolute terms, it still leaves Germany outperforming the rest of the euro area," James Ashley, European economist at RBC Capital Markets, told BBC News.

"We would expect the euro area as a whole to contract by around 0.4% this year and grow only by around 0.4% next year."

http://www.bbc.co.uk/news/business-19977926
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