Politics & Policy

Rosie O’Donnell Resorts to Drastic Measures to Save America

Making the click-through worthwhile today: Rosie O’Donnell commits a felony, how the new tax law might not be as bad for high-tax blue state taxpayers after all, and two men who need to leave the stage but who refuse.

Rosie O’Donnell: I Will Bribe Senators to Help Me Fight Corruption!

In order to save our political system from all the corruption, Rosie O’Donnell had to offer senators a bribe!

“so how about this i promise to give 2 million dollars to senator susan collins and 2 million to senator jeff flake if they vote NO NO I WILL NOT KILL AMERICANS FOR THE SUOER RICH DM me susan DM me jeff no s*** 2 million cash each,” she writes on Twitter.

Keep in mind, she is also ranting and fuming about “the super-rich buying senators.”

Under the U.S. criminal code, “giving, offering, or promising something of value” — like $2 million — to “any public official” — like, say, two senators — in exchange for “any official act performed or to be performed” has committed a crime punishable by up to 15 years in prison and a fine of up to $12 million.

Rosie O’Donnell loves our country so much, she can’t be bothered to actually know the laws.

Like Allahpundit, I find myself strangely eager to see Trump’s reaction to this. “If Trump doesn’t savagely dunk on Rosie on Twitter for trying to bribe Flake and Collins, why did we elect him?”

An Under-Covered Aspect of the Tax Bill That Helps those Blue State Taxpayers

An accountant reader points out that the tax bill includes a key, under-covered change that should mitigate the pain for those who live in high-tax states like New York and California, and who will now find their state and local tax deductions capped at $10,000 instead of unlimited: a big shift in the alternative minimum tax.

Back in 1969, Treasury secretary Joseph W. Barr told Congress that 155 taxpayers making $200,000 or more did not pay any taxes on their 1966 income, indicating that a wealthy taxpayer with a clever accountant could can enough deductions to reduce the taxable income level down to zero. This caused an uproar, and Congress changed the tax law to hit “wealthy” taxpayers with a higher tax level by not allowing them to take the deductions that other taxpayers do. Unfortunately, they didn’t adjust the income level for inflation, so eventually millions of taxpayers were paying a higher level of tax because of the AMT. The IRS said 4.4 million Americans paid the alternative minimum tax in 2015, paying an extra $7,000 than they would without the AMT. Households making between $200,000 and $500,000 were most likely to pay the AMT.

Under the AMT, a taxpayer can no longer deduct state and local income taxes, medical expenses, mortgage interest on home equity loans, and various other employee business expenses and investment expenses. You can easily picture working hard and being successful, enjoying a steadily rising income over a period of years, and then one year you finally get another big sales commission or that big raise you were hoping for, and suddenly you’re wealthy enough to hit the AMT, and then BOOM — your tax bill is much larger because you can’t deduct everything you’ve grown used to deducting in previous years.

The taxpayers who feel the biggest bite from the AMT are HENRYs — “high earners, not rich yet” folks who make a lot of money by national standards but don’t live a particularly luxurious lifestyle because they live in areas with a high cost of living . . . like California, New York, New Jersey, and other densely-populated coastal states and big cities. These, of course, are also many of the same places with high state and local tax rates, who will be hit the hardest by the cap on deducting state and local taxes.

Here’s the good news: under the new tax law, significantly more income is exempt from the calculations of the alternative minimum tax. “Under the old law, you can exempt $54,300 as a single filer and $84,500 as a married couple filing jointly. The new bill increases those exemptions by almost a third, to $70,300 and $109,400.”

The old AMT system also would reduce your exemption if your income hit a certain threshold: $120,700 for singles and $160,900 for couples. (In a lot of parts of the country, a husband and wife making $81,000 each are doing pretty good, but they’re not living a life of champagne dreams and caviar wishes.) Under the new law, those exemption thresholds are now way higher, $500,000 for an individual and $1 million for a couple.

If you live in one of those high-cost-of-living, high-state-and-local-tax places, there’s one piece of bad news and at least two pieces of good news. The bad news is you can only deduct $10,000 of your state and local taxes, and maybe you’ve gotten used to deducting $12,000, or $15,000, or even much higher sums each year. (Recall the Tax Foundation’s super-cool map of average state and local tax deductions by county. Yes, New York City’s five boroughs top the list with an average of $24,898. But the eighth-highest county in the country is Nassau County on Long Island with an average state and local tax of $11,624. Meaning the average taxpayer in that county will, in future years, deduct $10,000 instead of $11,624. That’s not a tax increase of $1,624; it means their level of taxable income goes up by $1,624.  Unpleasant, but hardly devastating.

The good news is that if you’re paying that much in state and local taxes, you’re probably making enough get hit by the alternative minimum tax, and the new law will reduce that.  What’s more, it should be paying less as your income tax rate went down by a few percentage points.

Of course, your tax filing is dependent upon a lot of your decisions — your income and any investment income, but also things like whether you have a mortgage, your state and local tax payment totals, your charitable contributions, etcetera. My back of the envelope math is that some people will enjoy a big cut, a lot of people will enjoy modest but tangible cut, and a few people might hit the worst possible sequence and see a modest increase. Looking at this chart, if you’re married and your joint taxable income is between $400,000 and $416,000, your tax rate is changing from 33 percent to 35 percent. (Quick, get your taxable income down to $399,000! Your tax rate will drop to 32 percent!) If you’re married and your joint taxable income is around $300,000, great news: your tax rate is dropping from 33 percent to 24 percent!

Here’s the Washington Post’s tax calculator, here’s the New York Times calculator, here’s one from Maxim Lott, executive producer for John Stossel.

Two Men Who Will Not Get Off the Stage

It has been thirteen days since Al Franken announced, “in the coming weeks I will be resigning as a member of the United States Senate,” and he has not declared when his final day will be.

Over at CNBC, Jake Novak says that Franken “un-resigning” would be political suicide.

It would completely undermine the zero tolerance policy for sexual harassment and misconduct that his colleagues like Senator Kirsten Gillibrand are promoting. That wing of the party got a boost from President Trump’s and the GOP leadership’s decision to back accused child molester Roy Moore in last week’s special election in Alabama.

Moore lost his bid for U.S. Senator, but Democrats will still relish using his name to claim the political high ground in the continued #MeToo backlash. There’s also a renewed effort to revisit the sexual misconduct allegations made against then-candidate Donald Trump just before the 2016 election.

If Franken stays, that strategy loses a great deal of potency. People like Manchin may say they’re only demanding different punishments for different levels of alleged misconduct. But it will come off as partisan hypocrisy and circle-the-wagons tactics.

Is the new Democratic position that eight tush-gropes are okay, but anything more serious warrants resignation? And you thought Gloria Steinem’s “one free grope” rule was lenient. Could we get a specifically enumerated total of gropes that are permitted before serious professional consequences?

Meanwhile, in Alabama, Roy Moore is promising in fundraising e-mails he will submit evidence of voter fraud to the Secretary of State’s office. Except . . .  he hasn’t done it yet. The election was eight days ago.

ADDENDA: Ever the good citizen, Brandon lets everyone who’s upset by the tax bill know that they are allowed to send extra money to the Treasury.

I’m scheduled to appear on CNN International’s “State of America” at 2:30 p.m. Eastern today.

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