Most readers think of income tax as the 35% they are forced to pay every year. However comparing Mitt Romney’s 15% to your 35% is not a fair comparison as the main line media would like you to think.
This is not an endorsement of Romney, but rather an explanation of the IRS tax code.
- First you have to understand the difference between how the IRS defines income. Your income (and mine) is derives from WORK. We go to work and get a pay check. Consider this the first time the money is earned.
- When you take this (first) income and use it to earn more money, this is the second income and is taxed at a lower rate.
We make some money and pay our taxes. IF we have any left over, we can put it into a) 401K, b) bonds, C) stocks and d) private funds that invest is other business. Each of the these further support the economy. 4o1K’s, bond’s, stock’s and private funds all ways to invest in different businesses. This money goes to buying new facilities, new manufacturing equipment (etc.) and each of these supports jobs – the jobs you and I have.
So why does the government tax what we make as income for our labors and from the profits derived from investing in America’s future? Taxing our first income is enough!
America’s founding fathers fought the American revolution over double taxation. So why are we tolerating what they died for?