Sunday, April 28, 2013

The Obamas Would Rather Pay More To The Private Sector Than Higher Federal Taxes

Posted by Milton Recht:

AS Harvard Economics Professor Greg Mankiw pointed out in his blog post today, "The President as Financial Planner:"
By selling some of those Treasuries and paying off the mortgage, they [the President and Michelle Obama] would effectively be getting five more percentage points on the amount; they would also be about $40,000 better off each year before taxes, not to mention being less exposed to notes that could take a hit from possible rising rates.

The Obamas would pay more in taxes but make much more after taxes -- especially since they aren’t getting the full deduction anyway, due to the AMT. That's more money going to the U.S. Treasury and more money for them; Northern Trust would be the loser. [Emphasis added.]
Mankiw is kind to the Obamas by presenting the issue as inattentive financial planning. I on the other hand think the Obamas do get excellent financial planning advice and are aware that they could have more money in their pocket if they choose to increase their tax payment. The certified public accounting and financial advising firm of Wineberg Solheim Howell & Shain, PC prepared the Obamas' tax return. I think it is a conscious, reasoned decision of the President and Michelle to pay more to a Chicago headquartered, publicly traded private company than to the US government.

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