Monday, December 10, 2012

Small Business Owners face Tax increase with Obama Tax Plan

The new Obama Tax Plan is not friendly to the small business owner.  While President Obama and the Democrats rant about raising taxes on the rich in the United States they are not talking about how they plan to also raise taxes on the true lifeblood of our country.  The small business owner.  The real Americans going after the American Dream.  These will be the true sufferers with the new Obama Tax Plan.

These small business owners earn 53% of all business income in the country so they are no small segment who will be dramatically hurt by the President's plan.  It is clear that the President has absolutely zero understanding of business as shown by his ideas and performance.  Paying higher taxes will reduce the amount of profits business owners would otherwise re-invest in their companies, making them less likely to expand and hire more workers. Economists agree that tax increases in general limit economic growth.

Under Obama's plan, the 33% tax rate would rise to 36% on taxable income above $231,000 for a married couple filing jointly. The top tax rate would increase from 35% to 39.6% on taxable income above $397,000. Obama's plan also would phase out the personal exemption and gradually reduce itemized deductions for individuals making more than $200,000 and married couples making more than $250,000.

The top capital gains tax rate would rise from 15% to 20%. Qualified dividends, which are now taxed at a top rate of 15%, would be taxed as ordinary income for top earners, or at a top rate of 39.6%. That, some business owners complain, would leave them with less money to hire new workers or keep the ones they have.

"Raising taxes on small businesses instead of taking a balanced approach that also cuts spending is wrong," Boehner, said recently. "It's only going to make it harder for our economy to grow. And if our economy doesn't grow, Americans don't get new jobs and the debt problem that we have will continue to threaten our children's future."

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