A lot of people are nervous about what might come out of Washington prompted by the current administration. A lot of my clients have been asking about whether their taxes are going to go up.
Unfortunately, my crystal ball is in the shop, so my predictions are a little murky.
ProPublica has made use of this general public uncertainty to try to shine a light on the wealth (and tax position) of the super-uber-wealthy. I’m not going to post a link – if you want to read the article, you can Google it (ProPublica Secret IRS File). I don’t have an interest in driving more traffic to the site – it was picked up by all kinds of media, so if you pay attention to national news, you have likely already heard about this.
We get it – there are some super-weathly people that (seemingly) don’t pay their fair share of taxes. But check out this analysis of the ProPublica article by Reason (and I will share the link to this article – which has links to most of its source material):
ProPublica’s Bombshell that Wasn’t, by Andrew Moylan and Andrew Wilford
Please read the full article, but here are the two most important points:
Despite ProPublica’s best efforts to make the information enclosed within seem damning, the data tell us little we didn’t already know. For the 2018 tax year, the last year for which we have data, the top 1 percent paid over 40 percent of federal income taxes, despite earning just under 21 percent of total adjusted gross income (AGI). The bottom 50 percent of taxpayers earned 11.6 percent of total AGI, but paid less than 3 percent of income taxes. The same story holds when looking at all revenue sources too, so it’s not just the income tax that is progressive.
ProPublica, however, tries to make the case that the wealthy are getting away with murder through the tax code, so they “do a calculation that has never been done before,” comparing growth in wealth over the course of a year to taxable income. They use this to calculate an individual’s “true tax rate,” which is sort of like handing out wins in a baseball game in the middle of the early innings and calling it the “true outcome” of the contest.
I’m not advocating one way or another for a change in how we administer income taxes – there probably needs to be some change and some increase in taxes to recover all that money the government has been spending on COVID relief. There is probably some low-hanging fruit in the upper tiers of income tax payers.
For purposes of this post, I am advocating for some perspective, and sharing a reminder that perspective is important. Please re-read the section that is emphasized above. Unfortunately, Reason does not cite it’s source, but you can take a look at the IRS statistics published every year to confirm the information – you’ll just need to do a little math on your own:
Here’s a more direct link to the downloadable spreadsheets: IRS Income Spreadsheets
Bottom line – watch for the agenda in a story – particularly one that seems like it really resonates. This is an example of a click-bait story that received a lot of traction, but didn’t really demonstrate much (and used some very questionable tactics)
PS – Personal income tax returns are not public information, and the IRS is supposed to keep your income tax return confidential. How did ProPublica get the information? Does this mean your personal tax information is also in ProPublica’s hands?
Delightful. The talent of this group is always worth the listen.
Check out this Agri News article about New Age Provisions. Located on the East side of Indy, Mario Vitalis is an “urban farmer” who is making efficient use of hydroponics to grow fresh veggies for local families and restaurants.
Urban farms are a cost-effective way to produce inexpensive, healthy, FRESH food for city folks. This system uses shipping containers converted to hydroponics growing environments – recycling in more ways than one!
Check out the story: Local Farm Brings Hope to Food Desert
The concept of Pi as representing the circumference of a circle has been around for *thousands* of years. Isaac Newton revolutionized the concept as part of his development of Calculus.
Yes, this is very nerdy. But it’s also fascinating – the history of Pi, and how Isaac Newton revolutionized a concept that had been used for thousands of years.
The video is a little simplistic, but the point is important – the best way to grow produce (lettuce, spinach, and other quick-growing “salad” crops is near the consumer. In a city, that means converting a warehouse to a vertical farming operation. How do you feed a city and reduce urban food deserts? You launch vertical farming.
Ag News article by Tom Doran about the four most prevalent myths surrounding farm subsidies.
- Myth: US Farm Policy gives preferential treatment and payments to corporate agriculture
- Myth: Farm Subsidies to go large food agribusinesses
- Myth: Farm policy gives preferential treatment to “the big five or six grains.”
- Myth: The government subsidized the sugar industry
Please read the article for more detailed explanation of each of these myths. You’ll need a little familiarity with how the farm program works in order to fully understand the article, but worth the read.
In almost every way, I prefer my rural life over urban life. I grew up on a farm, I still live on that farm, and I would not want to live anywhere else.
However, rural internet is years behind urban internet. Folks who live in cities take for granted internet speeds that are impossible to achieve in rural environments. While improving rural broadband is percolating up as a priority at both state and national levels, technology, affordability, and deployment of adequate internet speeds to my home and farm are on a deployment track of “later, rather than sooner.”
Check out the article (link below) from Farm Journal’s Ag Web about the digital divide and some opportunities that might help close that gap.
For the record, I believe that it will take multiple platforms working together to provide adequate, reliable, and affordable internet into the rural markets. No single provider can invest the millions of dollars in the infrastructure necessary to provide high-speed internet to the sparsely-populated rural areas. While there are grants available, my experience has been that the grant dollars tend to go into deep pockets for “research,” and are sometimes not applied where the services are needed. I’ve seen millions of dollars “awarded” for broadband development in rural markets. I have yet to see improvement in my neck of the woods.
The article discusses a couple of current options in development. If you read my blog regularly, or if you care to check previous posts on the Agriculture topic, you’ll find references to several other technologies in development for application in the rural environment.
Our farm uses technology in every phase of our operation. Progress and efficiencies are slowed because we don’t have access to reliable and fast internet (by “fast,” I mean at least 50MBs – which is not even on the radar for most governmental agency discussions). Until the rural environment starts to experience the speeds available in the city, rural development will be hampered.
See the flowchart below to walk through whether you might qualify for PPP #1, an increase in PPP #1, or PPP#2. Loan applications are being accepted NOW – contact your banker immediately to start the process.
NOTE: According to the December 23 Tax Act (CARES update), PPP income is NOT taxable, but expenses paid with PPP dollars are fully deductible.
For more detailed information about the items in the flowchart, check out the Farm CPA Blog: Farm PPP Loan Flowchart.
Whether you do or you don’t make (or keep) New Year’s Resolutions – check out what NASA plans for 2021. Get your resolution-inspiration from space technology!
Click through to the YouTube video and read the notes with more information about NASA’s 2021 projects.