The first $17,850 is taxed at 10 percent, meaning $1,785 in taxes. The rest is taxed at 15 percent, adding $1,192.50 to their tax bill, for a grand total of $2,977.50.
Advertisement
But in comes the child tax credit to the rescue! At $1,000 per kid, this reduces their federal income tax to zero.
Of course, they still pay Social Security tax, Medicare tax, sales tax, state income tax, excise tax, and if they own their home, they pay property taxes.
Does their zero dollars in federal income tax mean they don’t really care how the federal government spends its money? I doubt it. I doubt these people feel like non-taxpayers.
Here’s the thing: this family, pre-Bush tax cuts, would have owed federal income taxes.
Join the conversation as a VIP Member