Small businesses and those on the lower end of the wealthy (those making around $250,000) seem to have found a way to make it through the fiscal cliff and Obamacare. If the cliff is avoided by raising taxes on those who make over $250,000, these top earners and small businesses will simply make sure they do not earn more than $249,000 in a year. After all, after you pass the magic number, your tax rate goes up, right? Sort of. A marginal tax rate doesn't quite work that way. After an earner passes $250,000, his or her tax rate goes up, but only on what he or she has earned beyond $250,000. That is, if you make $260,000 in a year, only $10,000 of that will be taxed at a higher rate. Thus, if you try and keep your income below that magic number, you're only screwing yourself. If you're going to invite a small business expert on your show, this is one of the things he should know--and if you are going to play the journalist on your show, you should call him out if he doesn't know this basic fact.
More info
here, and
here.
(This is not an endorsement for raising taxes).
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