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Senate Tax Bill will hurt Mormon tithe payers


bsjkki

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Many Mormon's pay tithing and own a home so many also itemize their tax deductions. Because the tax bill strips out personal exemptions, people who itemize will end up paying higher taxes under the current proposal. Between sky high health premiums and a "tax cut" bill that will raise my taxes, I think the government is out to get me.  http://thehill.com/opinion/finance/352910-gop-creates-illusion-of-middle-class-benefits-in-tax-plan "

Households that currently itemize deductions rather than taking the standard deduction are also likely to see their taxes go up. Currently, taxpayers take personal exemptions on top of either the standard deduction or their personal itemized deductions.

But the Republican plan only offsets the elimination of personal exemptions by increasing the standard deduction. This means that households that itemize (and hence do not use the standard deduction) will simply lose their personal exemptions with nothing to offset it.

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I'm "poor," so I use the standard deduction and don't itemize. I wouldn't have a problem if charitable donations weren't an itemized deduction, though, and I think I would feel the same even if I did benefit financially for deducting tithing (or home loan interest, or whatever).

Our payment of tithing shouldn't be affected by whether or not it is tax deductible. 

Is there a large group of LDS who is up in arms at the prospect of not getting a tax break for tithing (or mortgage interest)? 

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Every year I try to use tithing to itemize but it’s never enough for me to make any difference on my taxes. The very wealthy may see a difference with the amount of tithing they pay but not the “typical” Mormon. So perhaps only the top wealthy Mormons will see any difference. 

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13 minutes ago, Darren10 said:

Every year I try to use tithing to itemize but it’s never enough for me to make any difference on my taxes. The very wealthy may see a difference with the amount of tithing they pay but not the “typical” Mormon. So perhaps only the top wealthy Mormons will see any difference. 

It’s not just the wealthy, it is also bad for those with large families. The child tax credit increase won’t help those with kids in college. 

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40 minutes ago, rongo said:

I'm "poor," so I use the standard deduction and don't itemize. I wouldn't have a problem if charitable donations weren't an itemized deduction, though, and I think I would feel the same even if I did benefit financially for deducting tithing (or home loan interest, or whatever).

Our payment of tithing shouldn't be affected by whether or not it is tax deductible. 

Is there a large group of LDS who is up in arms at the prospect of not getting a tax break for tithing (or mortgage interest)? 

No one is suggesting that tithe paying should be affected by whether or not it is tax deductible (straw man argument). But it has been a blessing over the years for many Church members, and I would say they deserve that consideration from government for the collective good that members of the Church do in society. It would be very disappointing if the government now eliminated the charitable deduction and/or the mortgage interest deduction.

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The standard deduction is going way up.   I calculated that you'd have to be paying on a 300,000 home and earning more than 80K a year (paying on gross) for this to be an issue for for any member.   I'm okay with that.  

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7 minutes ago, rpn said:

The standard deduction is going way up.   I calculated that you'd have to be paying on a 300,000 home and earning more than 80K a year (paying on gross) for this to be an issue for for any member.   I'm okay with that.  

$300,000 is not palatial in today's market. And $80,000 is not a huge annual income, especially for a two-income household.

This is apt to hit many middle-class Church members. I'm not OK with that.

 

Edited by Scott Lloyd
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4 minutes ago, rpn said:

The standard deduction is going way up.   I calculated that you'd have to be paying on a 300,000 home and earning more than 80K a year (paying on gross) for this to be an issue for for any member.   I'm okay with that.  

A $300,000 home in my area is a 2 bedroom, 1 bath starter home or condo and $80000 is a near poverty income due to the cost of living so your attitude about being fine with these young families taxes going up is sad.

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14 minutes ago, Scott Lloyd said:

$300,000 is not palatial in today's market. And $80,000 is not a huge annual income, especially for a two-income household.

This is apt to hit many middle-class Church members. I'm not OK with that.

 

One if the things that definitely needs to improve in the tax bill is stregthening its favoratism towards the middle class. 

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I like simplifying our taxes. Stripping away exemptions would do that. I would miss them but wouldn’t people who vote for higher taxes finally get to pay them? I have heard a lot of people upset how this will hurt Californians and New Yorkers but where’s the voices to get those states to live on much smaller budgets and not need to tax so much? 

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2 hours ago, bsjkki said:

Many Mormon's pay tithing and own a home so many also itemize their tax deductions. Because the tax bill strips out personal exemptions, people who itemize will end up paying higher taxes under the current proposal. Between sky high health premiums and a "tax cut" bill that will raise my taxes, I think the government is out to get me.  http://thehill.com/opinion/finance/352910-gop-creates-illusion-of-middle-class-benefits-in-tax-plan "

Households that currently itemize deductions rather than taking the standard deduction are also likely to see their taxes go up. Currently, taxpayers take personal exemptions on top of either the standard deduction or their personal itemized deductions.

But the Republican plan only offsets the elimination of personal exemptions by increasing the standard deduction. This means that households that itemize (and hence do not use the standard deduction) will simply lose their personal exemptions with nothing to offset it.

This would also seem to hurt giving by small donors to all non-profits.

Edited by ksfisher
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Just now, Darren10 said:

I like simplifying our taxes. Stripping away exemptions would do that. I would miss them but wouldn’t people who vote for higher taxes finally get to pay them? I have heard a lot of people upset how this will hurt Californians and New Yorkers but where’s the voices to get those states to live on much smaller budgets and not need to tax so much? 

It affects even them. IE; Tennessee takes a big hit.

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7 minutes ago, bsjkki said:

A $300,000 home in my area is a 2 bedroom, 1 bath starter home or condo and $80000 is a near poverty income due to the cost of living so your attitude about being fine with these young families taxes going up is sad.

The proposed change to the mortgage-interest deduction only takes effect at $500,000.  

The mortgage interest deduction has the ultimate effect of making housing prices higher.  It's really just a government (and tax-payer) subsidy to the real estate industry.  That's why they're freaking out about it.   Home buyers don't currently actually save any money; they just pay a higher price in the sale to compensate for paying lower taxes in the future, and this higher price benefits the real estate industry since it gets paid based on the sale price, and screws the people who don't itemize their deductions (usually lower-income workers) because it's higher-income people who typically itemize.    

Since the current interest deduction is "baked in" to the prices people have currently paid, it would be most fair to eliminate it for mortgages going forward so prices can adjust (downward) accordingly.  

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8 minutes ago, Darren10 said:

One if the things that definitely needs to improve in the tax bill is stregthening its favoratism towards the middle class. 

Seems like it's the very wealthy and the very poor who benefit from public policy changes these days. The middle class always ends up bearing the brunt.

 

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15 minutes ago, Darren10 said:

I like simplifying our taxes. Stripping away exemptions would do that. I would miss them but wouldn’t people who vote for higher taxes finally get to pay them? I have heard a lot of people upset how this will hurt Californians and New Yorkers but where’s the voices to get those states to live on much smaller budgets and not need to tax so much? 

It will hurt New Yorkers, Californians and Mormons who pay tithing with college aged children.

Edited by bsjkki
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