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50 comments on The SUV disease spreads

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jonniesmokes on October 4, 2005 - 1:50pm Permalink | Subthread | Parent | Comments top
Please enlighten us as to how business owners pay more taxes than the rest of us.  I'm not just trolling here; I'm really curious.

When I had a consulting business, I remember having to pay self employment taxes (the other half of social security and medicare).  But that's really just a tax that everyone has to pay.  It's just that the business owners get to do the paperwork for it.

Or are you talking about something else like state taxes?

What business owners can do that the us low class wage earners can't do is deduct business expenses like SUV's, fancy lunches with 'clients' and the expense for the fancy aquarium in the waiting room.  We can only spend our after tax income on those things.

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Adam on October 4, 2005 - 5:59pm Permalink | Subthread | Parent | Comments top
The self-employment tax is particularly nasty because it's regressive: People who have high-paid (ie. over ~$80K) jobs but do some extra work on the side don't have to pay it, whereas the genuinely self-employed do. Combined with state taxes, it can easily drive the marginal tax rate to >50%.

The other big cost is health insurance. Not technically a tax, I know, but the effect is the same.

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Biologyfool on October 4, 2005 - 7:25pm Permalink | Subthread | Parent | Comments top
I believe everyone is taxed on the first ~80K.  Those high-paid people do pay the tax (their employer actually pays it).  But if their employer paid them as a contractor, the employer could afford to pay them more (their salary+the payroll taxes).  Uncle Sam gets it one way or another.
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Southsider1 on October 4, 2005 - 8:23pm Permalink | Subthread | Parent | Comments top
Health insurance isn't a free good; it's part of your total compensation package. It's always better to look at your total compensation (salary + employer's social security contribution + benefits) rather than your salary alone to determine how much you get paid.
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