September 7, 2007

A Movable Sob Story

Justin Katz

My heartless campaign to explain to Rhode Island that there are alternative, more comprehensively beneficial ways of helping families than maintaining our state's structural deficit and driving out businesses and our most promising citizens continues in today's Providence Journal.

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Let's not overlook the fact that this family very probably receives an earned income credit from the Fed.

Which means they pay no income taxes and actually receive a net transfer from the goverment.

I think that's what they call income redistribution.

Posted by: John at September 7, 2007 8:03 AM

Nice piece Justin. Probably won't be popular with the poverty advocates, but it's hard to find anything to disagree with. Bottom line: minimum wage was not meant to be enough to raise a family on. I am sure Mr. Reyes is capable of being resourcful enough to improve his vocation and his earnings for the betterment of himself, his family, and society. I wish him well.

Posted by: Frank at September 7, 2007 8:29 AM

Bravo, Justin. Bravo!

Posted by: WJF at September 7, 2007 10:52 AM

Just checked on the IRS website.

With two children, the EITC phases out at around $39K, assuming only wage and salary income. As is true for so many taxpayers, its probable that at this level of income the only tax is SS and Medicare. Those are sold to us as necessary insurance, not tax. The taxpayers receiving the lowest 50% of income pay 5% of taxes. Unless, of course they run afoul of the dreaded AMT. According to a short item in the WSJ a while back, in some pathological cases, it is theoretically possible to qualify for EITC and get nailed by AMT - don't know if it has actually happened.

Posted by: chuckR at September 7, 2007 11:03 AM
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