- Home
- Business & Marketing (833)
- Editorials (671)
- Entertainment (2033)
- Fashion (1032)
- Highbrid (189)
- Honeys (2876)
- Humor (948)
- Music (5222)
- Need to Know (2224)
- News (2076)
- Podcasts (4)
- ARCHIVE
Thursday, September 9, 2010 | 12:36am
Obama Kabash on Wealthy Tax Credits Secretly Targetting Millionaire Rappers?
Will Jay-Z and rich rap friends turn their back on Obama after he puts an end to their Bush Era tax free-for-all?
@barackobama, jayz #irs #taxcredit
For some time now, Jay-Z has taunted his peers over his income with lines like “what you call money, I pay more in taxes.” And while we recently learned that to actually be a true statement, he might have to call his accountant after Today’s announcement by President Obama.
While much of the Hip Hop world was very supportive of President Obama’s campaign the truth of the matter is for a wealthy entertainer, especially the caliber of Jay-Z, Lil Wayne or the 900 Karat Birdman Obama and the Democratic policies are probably more counterproductive to those of the rich friendly Bush Administration. And today, President Obama announced that he will not be extending his predecessors tax cuts for the wealthiest Americans setting the stage for Democrats in midterm elections this Fall.
Obama’s new economic package which he announced during his address proposes an extension of tax cuts for the 98 percent of Americans with incomes below $250,000 for couples and below $200,000 for individuals. Clearly even the most creative of the Jiggaman’s accountants couldn’t convince the IRS that he is eligible. Hmmm…maybe it wasn’t a good time for him to buy an island for his wife.
The President hopes that the announcement will publicilly draw the line in the sand painting Republicans who traditionally vote down all his suggestions as supporting the wealthy instead of working class Americans. And what is infinately more damning for their image and popularity leading into the elections, voting against ending the Bush Tax Credits in turn would be supporting Hip Hop. All those mysogonistic rap lyrics, violence and sex. Who wants that on their resume.
So while in 2008 Hip Hop may have bragged about being an important cog in electing the President by throwing benefit concerts, creating Will.i.am support viral videos and raising awareness, The President may have alienated and important base today by pissing of the very mouth that feeds him. There goes the end of his name drops in rap songs.
FILED IN Business & Marketing, News
Not entirely true. I make a lot less than 250k per year, but I’m going to get screwed when the dividend tax rate goes up at the end of the year.
Yes Malcolm, we are all going to get screwed one way or another. It makes no difference if you make 259k or not your taxes are going up under this admin no doubt about it.
explain Malcolm. Break it down for us. Obviously the post was very tongue-in-cheek but give us the math.
OK… but it’s going to be a complete answer for those who are not familiar with dividends.
.
With the economy sucking like it does, there aren’t too many places where you can put your savings and get anything close to a return.
.
Savings accounts are now paying less than 1% in interest, stocks purchased purely for price growth are risky, and gold is for suckers.
.
Like must fiscally conservative investors, I have put a large portion of my money into dividend paying stocks.
.
When you buy dividend paying stocks, it’s like getting free money. As a shareholder, you get free money from the company in the form of a ‘dividend’, which is a dollar value based on each share that you own.
.
For example, if you own ATT stock, you receive $1.68 per year for every share that you own. This may not seem like much, but it works out to a return of 6.20%, over 7 times the amount that most banks will pay you these days.
.
If you’re smart, you use what’s called a ‘dividend reinvestment plan’. This means that instead of getting your money in cash, you tell them to use the money to buy more shares. Doing this creates a snowball effect. Each quarter, you get more stock, which increases your total dividend the next time, which gets you even more stock, etc.
.
Tip for the novice: If you invest in solid companies with solid long term dividends, and you insist on investing ONLY in companies that have automatic dividend reinvestment plans, you WILL be rich in the end.
.
In general, you can use the ‘rule of 72’ to find out how long it will take you to double your money. Take ATT for example. The dividend is 6.2 percent. So you say 72 divided by 6.2 = 11.6. This means that at the current rate, if you reinvest the dividends, you’ll DOUBLE your money in a little less than 12 years.
.
The neat thing about this is that it doesn’t matter if the stock price goes up or down, you still get paid. In fact, if the price drops just before the dividend is paid, you wind up ahead of the game because your dividend buys more shares.
.
Anyway, back to the subject at hand…. At the end of the year when you do your taxes, you have to declare (and pay taxes on) any dividend you receive.
.
Currently, the tax rate on dividends is 15%. However…. This was part of the Bush tax cuts, it’s set to expire…. AND… The prez is unwilling to extend it.
.
So, if (when the economy crashed), you ran to dividends as the only way to preserve your money, you are now looking at a 39.6% tax rate on all dividends.
.
This is going to hurt the old people (who are too old to work and live off their dividends). It’s also going to hurt anyone who saved when everyone else was spending their money. And it’s basically going to screw anyone who protected themselves against the crash that most of us knew was coming.
Let me put the math a better way to show how the interest will compound.
.
Using the ATT number as an example, let’s say that your wife delivers your new son or daughter today.
.
If you put $500 into ATT stock, reinvest the dividend, and add only $500 per year; when your child reaches 18 years of age, you will have $67,000 to use toward their college education.
.
That’s an investment of 36,000 (500 * 18) + 31,000 in dividends you would be paid.
scratch that. That should have been $2000 per year. But hey… compound interest still works
Wow playboy that is very interesting info . R u peeping game Nation . I might have 2 look deeper n2 that stock game myself . I maybe able 2 put in 3 Benji’s a year hopefully . Communication and media is a wise investment.