Is it possible to spend 60-65% of your income in taxes in the US

Miscellaneous and Personal Stuff I Must Share
1

Watching the documentary Mitt there was a short part about a small business owner who said he spent about 60-65% of his income in taxes.

Which got me wondering if that is possible. I do not understand small business taxes however I understand you have to pay the full FICA by yourself which is 15.3% of gross income, up to about 100k.

So an income of 100k would have a federal income tax rate of maybe 22%.

Do small businesses get any tax credits to offset them having to pay the full FICA tax?

If property taxes are extremely high, they could be 8% of gross income.

So those 3 (federal income, FICA and property, all assuming you are at near the highest rates) adds up to 45% of a 100k income without taking into account state income, county, city taxes as well as sales taxes, fuel, sin taxes, etc. My state has fairly low income taxes, but places like CA can have 8-10% rates. However I don’t know to what degree the tax rate is deducted from federal in various states. And CA has a pretty high state income tax rate.

Gasoline is only about $0.40 in state & federal taxes per gallon. With 2 cars and maybe 150 gallons a month that is only $60 a month for fuel taxes. At best, less than 1%.

2

I suspect that I am close to that threshold, but I’m not eager to be dogpiled with ‘Cite?s’.

3

Probably the person’s expenditures need to be heavily in cigarettes, booze and gambling.

4

Hell, all you need is a bad year with low or no income and a property tax bill to spend more than 100% of your income in taxes.

5

It’s not that the tax rate is that high, it’s that a lot of it isn’t based on your income. You could have a bad year and up owing more than 60 65% easily.

6

Income tax and FICA are percentages which, in theory, should go up and down when income goes up and down and that is what we think of when people talk about income and taxes. But when you factor in flater taxes that a business might have, like property tax, it should be easy to find individuals who have paid 50, 75, even 100% of their income in taxes. Some businesses make zero dollars in some years. Imagine the percentage of taxes they pay!

I would call those bad businesses and not necessarily examples of hard working Americans being over taxed. And it’s rather odd to hear Mitt Romney’s name in the context of people paying too much tax.