Does ABC News understand how income tax works?
Are people really this stupid (or more charitably, ignorant of how the US tax system works)?! And the people in the article are highly educated (an attorney and a dentist, for example).
ABC covered fairly well-off people talking about reducing their income to below $250k to avoid the increased taxes (or reduced reductions, more accurately) proposed by the President. They seem to think that as soon as you earn that last penny to go over the line, all your income is suddenly taxed at a higher rate. Very wrong. Only the incremental income beyond the line ($250k in this example) is taxed at the higher rate. If you earned $251k, only the last $1k would be taxed at the higher rate.
Do people really think someone making $251k would pay huge amounts more in taxes than someone making $249k?! This would explain a great deal about why various arguments about increasing rates on the highest tax brackets get any traction.
