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Saturday, July 03, 2010

Higher Taxes: No I'm not Crazy Thinking that Yeshiva Tuition is Going to Become Even Harder To Pay

With apologies to my readers who object to politically charged posts, please be forgiving . . . . . . I realize that not all my reader are fans of the ATR (Americans for Tax Reform) and might take issue with the use of the terms "ObamaCare" and "Death Tax" as opposed to Health Care Reform and the Estate Tax, but as far as I can tell, all the details in the following article (posted after my ramblings) are accurate. I have also spoken to tax professionals and any repeal of the rollback appears highly unlikely. (Happy 4th of July!)

One thing I can't stand is when discussions of political policy turns completely self-centered and the entire focus of the frum community is inward, i.e. what's in it, or not in it, for me? But one reason I'm pointing out the tax changes coming your way and mine is because this is something the frum world needs to grapple with and get prepared for now. In January 2011 your withholdings should go up. If you are self-employed/contractor, prepare to make greater quarterly payments. In 2012, a higher tax bill is coming. So, feel free to self-center the comments and let us know which tax hikes are going to affect you, and how they will affect your ability to give tzedakah and/or pay yeshiva tuition.

Numbers would be even better (feel free to mark yourself under an anon# name to preserve privacy). I'm not usually so open, but my current calculation of tax hikes (assuming no change in income) between 2010 and 2011 to be in the neighborhood of $2600, which doesn't include changes on dependent care credits and the use of Coverdells. Nor does that include additional tax which we will incur regardless of changes in income as our itemized deductions fall (yeah for refinancing, boo for the rest of it). I've included the social security and state tax damage from capping the Flexible Spending Accounts in my calculation. To put the $2,600 in perspective, it isn't peanuts.

It if probably a good thing that I'm already convinced that yeshiva tuition isn't going to be something we can afford long into the future because, I hate surprises! We might as well start mentally preparing now. As I was trying to explain to a friend recently, adding another tuition + covering the steep tuition increases + all the other expenses that come with age isn't a simple matter of just cutting back on retirement savings because there isn't a 1:1 relationship. (Someone really should remind me not to enter tax planet while on a pleasant day in the park with the kids and the other Moms because I just start running scenarios and talking mostly to myself. Not to be politically incorrect, but ladies generally like to give "chizuk" not listen to ramblings from an accountant about teetering on the edge of credit phaseouts, the next tax bracket, and how big medical expenses are about to become even less affordable).

The article detailing many tax hikes is cut and pasted below. There is a lot of bad news in here for Americans hoping for an economic recovery. There is a tax hike in here for everyone, and by that I mean almost everyone (yes, even Kollel Families!). The 10% tax bracket is being eliminated for starters. Below is a chart of what the estimated tax brackets for 2010 and 2011 for those who want to start making calculations. My apologies for only including Married Filing Jointly. I'm not attempting to discriminate, but to not overload a post with too much information. A few comments, as usual, in orange will be interspersed in the article.

2010 Estimated Tax Brackets (Married Filing Jointly)
10% Bracket $0 – $16,750
15% Bracket $16,750 – $68,000
25% Bracket $68,000 – $137,300
28% Bracket $137,300 – $209,250
33% Bracket $209,250 – $373,650
35% Bracket $373,650+

2011 Estimated Tax Brackets (Married Filing Jointly)
Tax Bracket Married Filing Jointly
15% Bracket $0 – $70,040
28% Bracket $70,040 – $141,419
31% Bracket $141,419 – $215,528
36% Bracket $215,528 – $384,860
39.6% Bracket Over $384,860

Six Months to Go UntilThe Largest Tax Hikes in History From Ryan Ellis on Thursday, July 1, 2010 4:15 PM

BREAKING: Wounded Warriors Face New Tax This Independence Day

In just six months, the largest tax hikes in the history of America will take effect.

They will hit families and small businesses in three great waves on January 1, 2011:

First Wave: Expiration of 2001 and 2003 Tax Relief

In 2001 and 2003, the GOP Congress enacted several tax cuts for investors, small business owners, and families. These will all expire on January 1, 2011:

Personal income tax rates will rise. The top income tax rate will rise from 35 to 39.6 percent (this is also the rate at which two-thirds of small business profits are taxed). The lowest rate will rise from 10 to 15 percent. All the rates in between will also rise. Itemized deductions and personal exemptions will again phase out, which has the same mathematical effect as higher marginal tax rates. The full list of marginal rate hikes is below:
- The 10% bracket rises to an expanded 15% [excluding those who get hit by the AMT, all benefit from the 10% bracket. My experience tells me that many large families and kollel families sit in the 10% bracket]
- The 25% bracket rises to 28%
- The 28% bracket rises to 31%
- The 33% bracket rises to 36%
- The 35% bracket rises to 39.6%

Higher taxes on marriage and family. The “marriage penalty” (narrower tax brackets for married couples) will return from the first dollar of income. The child tax credit will be cut in half from $1000 to $500 per child. [Ouch! The child tax credit includes up to 3 children currently. Really an ouch. I mistakenly confused the phaseout on a welfare credit I deal with too often with this credit (oops). This will really hit families hard. Not really an upside, but families that cut back on retirement and hit the phaseout won't get such a double-whammy] The standard deduction will no longer be doubled for married couples relative to the single level. The dependent care and adoption tax credits will be cut. [A hit for dual income families].

The return of the Death Tax. This year, there is no death tax. For those dying on or after January 1 2011, there is a 55 percent top death tax rate on estates over $1 million. A person leaving behind two homes and a retirement account could easily pass along a death tax bill to their loved ones. [In other words, don't think a yerusha will pay your bills. . . and, no, tax planning isn't just for the super rich].

Higher tax rates on savers and investors. The capital gains tax will rise from 15 percent this year to 20 percent in 2011. The dividends tax will rise from 15 percent this year to 39.6 percent in 2011. These rates will rise another 3.8 percent in 2013. [Confusing sentence. In other words, dividends will be taxed as regular income and then, there will be an additional tax on investment income, including royalities and rental properties, come 2013 as part of the Health Care Package].

Second Wave: Obamacare

There are over twenty new or higher taxes in Obamacare. Several will first go into effect on January 1, 2011. They include:

The “Medicine Cabinet Tax” Thanks to Obamacare, Americans will no longer be able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). [In other words, if you overshoot on your FSA come 2011, you will end up forfeiting the funds because you will no longer be allowed to load up on Advil at tax advantaged prices].

The “Special Needs Kids Tax” This provision of Obamacare imposes a cap on flexible spending accounts (FSAs) of $2500 (Currently, there is no federal government limit). There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. [Special Needs is only one demographic sure to be hit by the lowering of the FSA. A few other demographics: families with lots of kids, families paying for catastrophic care, any family paying for braces or major dental work].

The HSA Withdrawal Tax Hike. This provision of Obamacare increases the additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent.

Third Wave: The Alternative Minimum Tax and Employer Tax Hikes

When Americans prepare to file their tax returns in January of 2011, they’ll be in for a nasty surprise—the AMT won’t be held harmless, and many tax relief provisions will have expired. The major items include:

The AMT will ensnare over 28 million families, up from 4 million last year. According to the left-leaning Tax Policy Center, Congress’ failure to index the AMT will lead to an explosion of AMT taxpaying families—rising from 4 million last year to 28.5 million. These families will have to calculate their tax burdens twice, and pay taxes at the higher level. The AMT was created in 1969 to ensnare a handful of taxpayers. [I wish I understood the AMT better].

Small business expensing will be slashed and 50% expensing will disappear. Small businesses can normally expense (rather than slowly-deduct, or “depreciate”) equipment purchases up to $250,000. This will be cut all the way down to $25,000. Larger businesses can expense half of their purchases of equipment. In January of 2011, all of it will have to be “depreciated."

Taxes will be raised on all types of businesses. There are literally scores of tax hikes on business that will take place. The biggest is the loss of the “research and experimentation tax credit,” but there are many, many others. Combining high marginal tax rates with the loss of this tax relief will cost jobs.

Tax Benefits for Education and Teaching Reduced. The deduction for tuition and fees will not be available. Tax credits for education will be limited. Teachers will no longer be able to deduct classroom expenses. Coverdell Education Savings Accounts will be cut. Employer-provided educational assistance is curtailed. The student loan interest deduction will be disallowed for hundreds of thousands of families. [Unlike most employees who must meet a 2% floor before deducting any business expenses as an itemized deduction, educators have been given a nice gift, decreasing both federal and state income tax. Like I said, these changes are broad and there is an increase in there for everyone].

Charitable Contributions from IRAs no longer allowed. Under current law, a retired person with an IRA can contribute up to $100,000 per year directly to a charity from their IRA. This contribution also counts toward an annual “required minimum distribution.” This ability will no longer be there. [Shuls, schools, and all tzedakas listen up. . . the news isn't good].

Read more: http://www.atr.org/sixmonths.html?content=5171#ixzz0sgPL3f3c

46 comments:

Dave said...

In order to pay off the 40 years+ of living on credit (minus a few years under Clinton when we were actually almost in balance), we're going to need to raise taxes across the board.

Raising the rate in each bracket will do it (15%->20%, and so on). We've already run up the tab, now the time has come to pay the piper.

And for Social Security long term solvency, the cleanest fix is to remove the cap (and for fairness, the corresponding benefit limit), which removes the "pay raise" for those making more than (in 2010) $108k/yr.

The only question in my mind is how much political whining about it goes on. We've done the easy bit (spend, spend, spend) for two generations. Now the bill has come due.

Dave said...

Oh, one other thing.

The AMT bit is scare mongering. Congress indexes the AMT to inflation manually each year.

Anonymous said...

Jews can always move to Israel where there are high taxes but free tuition.

JLan said...

A few notes:

1) The income tax bracket issue will, of course, affect those who get it by the AMT differently (i.e. far less) than those who pay the standard rates. Bad for those making $450k+, but it's not as bad for many of those in the $150-450k range.

2) The capital gains rates go back to the old ones. That is, people in the 10 and 15% brackets now (15% then) will see their cap. gains rate go from 0% now to 15%. 20% capital gains only starts in the 28% bracket.

3) The 3.8% tax on investment income is only applicable to those making over $200k individual/$250k couple, and for amounts surpassing that amount (i.e. if you earned $225k as a couple and had $50k in investment income, you'd be paying the 3.8% on $25k).

4) There are some things you can use part of the FSA on which you can accelerate the purchase of: contact lenses come to mind (the solution is probably out the window, though). So yes, you'll likely lose some money there, but it can be mitigated through some things still on the list. Other ideas: if you schedule your dentist appointments in the Dec/Jan and Jun/July period, you can push them forward or back pretty easily.

5) There is still a 7.5% minimum for deducting medical costs. With that said, if you're really paying for catastrophic care, you'll likely surpass that.

(more comments in the next reply)

JLan said...

6) Charitable contributions can still be deducted; the no direct contributions from IRAs is more of an issue for those hit by the AMT than anything else (or for those whom it will drive into the AMT range).

7) Regarding the AMT: Dave is correct in saying that Congress has been manually indexing it every year, but I'm not sure I would depend on that in the future.

8) Finally, the $400/800 Making Work Pay credit (for individuals making under $75k and couples under $150k) is going to disappear as well, unless it gets extended.

Anonymous said...

Not sure why you think the child tax credit is limited to three children... it's not. Which means the impact of cutting it in half will be larger than you think.

Anonymous said...

The expiration of the temporary tax reductions may be the most immediate issue, but there are other looming issues that may also affect what is available for other expenses, including (i) increasing health care costs -- even if problems in the current system are fixed, we still have an aging population and increasing medical tecnology and treatments; (ii) increased energy costs which may make everything more expensive (don't be fooled by the current relatively low cost of gas); (iii) increasing need to save more for retirement due to lower returns and longer life expectancies; (iv) more money needed for national security; and (v) increased state and local taxes due to loss of federal aid and all those unfunded/inadequately funded pensions and retiree health insurance benefits at the state and local level that cannot retroactively be reduced or taken away. I hope my concerns turn out to be overblown, but the message is that learning to live simply and frugally and the need to give tzedakah will only increase.

Orthonomics said...

Anonymous-I stand corrected and have struck relevant text. My confusion was with the add'l child tax credit, a welfare credit (not one we get, but I deal with it in the course of events and quickly remembered the limit changing to 3 max, hence the mistake). Thanks for catching that.

Dave said...

It's also worth noting that the "marriage penalty" only applies to dual-income families. Single income families still are rewarded by the tax code.

Scraps said...

Oh man. I knew it was going to be bad, but I didn't know it was going to be this bad.

abc said...

the next 25-50 years are sadly going to see a great decline in Orthodox jewry. We are all burying our heads in the sand in what is the biggest issue of the day. The average family has no prayer of being able to keep paying tuition. Many of our children will choose not to be frum over this.

Anonymous said...

abc: That's only if you assume that yeshiva/day school is a requirement for being an orthodox jew. Yes, some children may turn away, but that's only if this generation doesn't figure out alternatives and tells people they won't be accepted if they use alternatives to the current educational system. Jews lasted for millenia without universal full-time jewish education. Why does one have to be a talmudic scholar to be an orthodox jew? That is a historical blip. Alternatively, there is aliya. If you are really concerned about your children rejecting orthodoxy, make sure they are fluent in Hebrew and consider college in Israel instead of the u.s. along with appropriate career choices for making aliya.

Anonymous said...

I have no idea how to calculate the impact the changes will have, but we regularly hit AMT.

Miami Al said...

Anon 7:29,

Because it will be increasingly easier for people to claim to "reject Orthodoxy" and avoid the situation than it is to "embrace Orthodoxy" but not Yeshiva.

Swimming up river, getting harassed by some parts of the community, etc., for people that aren't strongly motivated, it's easier to just pick up, move, and claim OTD status instead of fighting.

There is certainly ZERO legitimate requirement that every Jew receive this level of education, and a ruling on the books that was never put into practice is largely irrelevant, but the Orthodox culture of today certainly encourages it, to say the least.

Orthonomics said...

abc-Yet another reason to be proactive, rather than reactive.

Anonymous said...

Here is my concern: I think a lot of frum people would simply send to the public schools, but in many jurisdictions (urban areas) the public schools are not acceptable due to the behavior of the students in those schools. So, while it would be wonderful to stay and send to public school and stay orthodox, it is not practical. Especially if one has school age children, switching from a frum school where standards of tzniut and behavior are so different, would be a complete culture shock to those kids.
I think this is why people feel compelled to 'move away'.

tesyaa said...

Especially if one has school age children, switching from a frum school where standards of tzniut and behavior are so different, would be a complete culture shock to those kids.

Yes. Once your kids are in yeshiva, you are effectively locked in; your kids are vulnerable to "psychological damage" or "culture shock" or any number of "other things". The irony if your kindergartner starts in public school, not only does culture shock not apply, but behavior and tzniut differences are not so important because of the young age. So suggestions have been made that grades K-5 are ideal for public school + Judaic tutor.

However, most parents can afford yeshiva for their first child; once they send their first kid to yeshiva for a few years, their fate is sealed as far as yeshiva tuition goes.

megapixel said...

learning to live simply?

what about those of us who have already been living simply?
what are we supposed to do?

to Dave: Paying the bill, as you call it will only help if you ALSO cut spending. but Obamas plan does not involve cutting spending but increasing it. all these tax increases are likely to throw many people who are just making it financially into the category of people who need govt assistance to live. so that is going to increase the govt's burden.
I heard recently that 41% of Americans are on food stamps.
41%!!!that's almost half of americans.

conservative scifi said...

I hear whining, but I don't hear solutions. I particulary am disheartened by comments like Megapixel's of "cut spending". Ok, I am also in favor of cutting spending. I'd cut all assistance to any household of two non-disabled adults, where one chooses to go to yeshiva rather than work.

More significantly, go to a website like http://www.kowaldesign.com/cgi/Budget.pl?estimates=111111 and figure out where you would cut. Then figure out if you could convince anyone else to agree with you that medicare, social security or DOD should be cut, and by enough to make a difference. Most of the rest of the government doesn't much matter, really, budget wise.

Orthonomics said...

Megapixel was questioning a suggestion earlier in a thread. Sure, some have room to cut back. But plenty have cut to the limits and greater tuition bills + greater taxes will be the breaking point.

As for solutions, those who arrange their own alternative will have a solution. Those who ignore the coming tsunami may have to march to the district office and register.

Anonymous said...

Dave,

There isn't enough wealth to pay off all of the debt incurred by Obama alone (not even what he "inherited") even if we taxed people at 100%. Taxes are not about revenue, they are about control. The power to tax is the power to destroy. Candidate Obama said it himself---he would raise capital gains taxes, knowing that they lower revenue, to promote fairness.

Anonymous said...

"I heard recently that 41% of Americans are on food stamps.
41%!!!that's almost half of americans."

It is 41 million. Not 41%.

Anonymous Toolshed said...

For better and for worse, we've build a society already more than 60% of revenues go for defense spending, social security, medicare and medicaid. These costs will probably continue to rise will the aging population. (When you factor in interest on national debt it's close to 70%)

There are really only two ways to deal with this: raise taxes or reduce spending. And when I say reduce spending, cutting the salaries of your elected representatives is meaningless. You would have to cut the big things, mentioned above.

We can debate the fairness or necessity of the specific tax increases, but I don't think there's any doubt that BIG tax increases are necessary and will happen. If you don't think they are necessary, you've really got to be prepared to cut defense, medicare, medicaid and social security.

sethg-prime said...

Here is CBS News’s summary of the tax hikes in Obama’s 2011 budget, which provides a more balanced presentation than you’ll get from Grover Norquist.

On table S–8 of this PDF document, you can see all the tax cuts and increases in the budget, and how much each of them is expected to reduce or increase the deficit over the next ten years.

The Web site for the budget overview is here, but I don’t see where to get more detailed information about what is expected to happen on the tax end.

Dave said...

There isn't enough wealth to pay off all of the debt incurred by Obama alone (not even what he "inherited") even if we taxed people at 100%.

Well, in that case, it's all over. Because the previous administration ran up debts that dwarf anything this one has. So apparently, there is no way out.

We have to move the needle to net-surplus, so that we pay down the debt.

Candidate Obama said it himself---he would raise capital gains taxes, knowing that they lower revenue, to promote fairness.

Increasing tax rates do not lower revenue, as a general rule. Decreasing tax rates do not raise revenue, as a general rule.

The only exception is the "Laffer Curve", the point at which raising taxes reduces revenue. We haven't been anywhere close to the Laffer Curve in a generation, and what people who like to quote it forget is the Laffer Curve describes the point of maximal revenue. If you are to the left of the Laffer Curve, raising taxes does indeed raise revenue.

Paying the bill, as you call it will only help if you ALSO cut spending. but Obamas plan does not involve cutting spending but increasing it.

We saw how well reducing spending worked in the 1930s. Hint, it didn't, and it pushed the economy back over. We are in the seven lean years, the only difference is we never saved in the seven fat years.

. all these tax increases are likely to throw many people who are just making it financially into the category of people who need govt assistance to live.

Going to tax rates well under those initially put in place by Reagan is apparently going to destroy us. Who knew?

We have to raise taxes. We have to cut spending. Let the tax cuts expire as scheduled. Pump a bit more fuel into the economy until the recovery is self-sustaining. Once we're well under way, we will need to further raise taxes, and cut spending.

RAM said...

Someone has to solve the problem of government employees + people dependent on government always voting to increase government spending on themselves. This gets worse as the government expands at the expense of the private sector, which is our current Administration's policy.

No set of new taxes gets to the root of this problem, which makes spending outpace any taxation.

If any Orthodox Jews remain political liberals, now is the time for an attitude check.

Miami Al said...

Dave,

The secret is more "automatic stabilizers" for Keynesian stimulus. i.e. in flush times, Unemployment Taxes/FICA taxes suck money out of the economy automatically. In lean times, Unemployment Checks + increased retirement pumps money back in. That's much more useful than Congress trying to stimulate the economy, because they are normally late to the game.

That said, if you want to spur investment and the economy, you should be pumping money in now, and encouraging long term investment. i.e. future tax hikes are devastating, because they discourage investment because you invest the money now, when capital is scarce, and pay a higher tax rate when you collect, this is dumb Keynesian economics.

We saw with the "stimulus" payments that simply shoveling cash out the door does not get the multiplier effect. Cutting marginal rates DOES encourage economic activity, but dumping cash has a less effect.

It would be much more helpful if Congress would do the "minor" entitlement tweaks that has a future cut, that would dramatically bring down future deficits.

Increasing the retirement age to 70 over 35 years (1 month/year) from 67, and raising full retirement from 70-75, plus perhaps reducing the social security COLA by 0.5% would spread the pain out, but would probably improve the future outlook of the US Government dramatically.

Similarly, the problem with the rate increases is not the size, it's that they are in the future.

You make money at 35%, invest it to pay a higher capital gain when you realize or higher income tax when the business takes off? The is discouraging of investment.

Orthonomics said...

What anonymous is thinking of is probably the nearly 40% of Americans who pay no Federal Tax, or even receive a paycheck as their Federal Tax is "negative."

Dave said...

The problem is that tax incentives are not an all-purpose remedy.

Right now, the wisest course for anyone (businesses and individuals alike) is to stay lean and frugal. And changes to the tax code do NOT change this.

However, as an aggregate, this is devastating to the economy as a whole.

In a Keynesian model, the government is the economic engine of last resort. And frankly, Keynes appears to have been a lot more on target than the Greenspan school of deregulated and omniscient market.

Frankly, what we need are low-level stimulus packages. For example, many local governments are looking at laying off a lot of staff because they simply don't have the funding. Federal support of those (and yes, that means deficit spending, but the economic downspiral and deflationary pressures are a bigger threat right now than the deficit) would have a direct impact at the lower level.

And the Republican officials who think that unemployment payments are keeping people from getting jobs (when we average 5 applicants for any position) are just insane.

Orthonomics said...

Seth-With all due respect, the CBS article is hardly "balanced" because it doesn't bother to mention things that are fairly easy to confirm like the elimination of the 10% tax bracket, the cutting of tax credits (save the welfare tax credits that are being expanded-oy), and the cutting of the FSA which is a highly popular financial vehicle used by the Middle Class.

Perhaps the bottom line is a bit different: those on programs will benefit and those of us who aren't on programs will have less discretionary money and better plan ahead vis a vis things like Jewish Education.

Dave said...

Percentage of Americans who pay no Federal Income Tax: http://www.factcheck.org/askfactcheck/do_40_percent_of_americans_pay_no.html

tesyaa said...

those on programs will benefit and those of us who aren't on programs will have less discretionary money and better plan ahead vis a vis things like Jewish Education.

Implicitly, this assumes that most if not all discretionary money is going to Jewish education.

There will be a day of reckoning when the community decides whether or not this is an appropriate use of community funds.

Surely, charities that help the sick and the truly indigent will be receiving less funds as people spend a larger percentage on educating their own Jewish children.

I also question whether spending large sums on education that does not prepare a child for college or a career is a wise move - particularly an issue with boys' yeshivas.

Orthonomics said...

tesyaa-Do you think my assumption is too overreaching for the families that are bound to lose half their child tax credits?

tesyaa said...

I don't really get the point of this post. That taxes will go up? (Or, as many would say, that taxes need to go up?) People will continue to spend on tuition anyway.

Anonymous said...

Tesyaa,

Or, as you have pointed out, the resources go to providing a secular education in a religious environment.

Anonymous said...

Tessya: Perhaps the point of the post is that people need to have a long term perspective and when planning, to keep in mind the coming economic changes when making decisions such as where and whether to buy a house and how much house, where to live, career decisions, whether and when Mom can take time off from a career track, etc.

I give up said...

I'm seriously thinking of quitting my job, finding a part time low paying job and then applying for programs.My wife and I went over the numbers many times and always came to same conclusion:We would be better off financially if we were on programs and our quality of life would improve dramatically.And most compelling: We see which way the wind is blowing.Only those on programs or those making a tremendous amount of money will be able to make it financially.

tesyaa said...

Sorry, but if sending our kids to yeshiva means giving up our work ethic and relying on public assistance as a lechatchila, then I seriously question whether this education is even meaningful or useful for our children.

I give up said...

Huh?Because I realize that I would be better off financially on programs (and willing to do my patriotic duty of "stimulating the economy" by applying for food stamps err Supplementary Nutritional Assistance"- as our president euphemismed taking them)means that: sending our kids to yeshiva means giving up our work ethic and relying on public assistance as a lechatchila?

Miami Al said...

I Give Up,

If the requirement to educate our children in "how to be Jewish" requires us to stop being Jewish, what's the point? We're not supposed to take handouts from "goyim" under Halacha.

If sending your kids to Yeshiva required working Saturdays, would you do it? What if the scholarship committee told you to eat treif meat to save money to pay tuition? Would anyone find that reasonable?

The question is, are you permitted to pick and choose mitzvot in order to pay for Jewish education? If you do that, you're no longer Orthodox, so why bother educating your children in an Orthodox school?

Anonymous said...

I still find it difficult to believe that there are Jews who voted for Obama.

Anonymous said...

Anon 6:24: There are more jews who find it difficult to believe that a jew would vote republican.

Anonymous said...

SL: Assuming that Congress is too fractured to do anything about restoring some of the tax cuts, at least for the middle class and below, are there any particular tax strategies that you think make sense - i.e. sell stocks that have appreciated to get the lower capital gains tax, defer charitable contributions? accelerate charitable contributions? etc.

Anonymous said...

To paraphrase Jabotinsky,"Yidden,get out of here before it's too late!"

Mark said...

There is no way to know now what the tax system will look like next year. There almost definitely has to be some sort of tax bill this year because if the sudden shock of current law is permitted to take effect, there will likely be a "double dip" recession. More importantly, Obama and his advisers know this, and know that if it occurs, he will not be elected to a second term. They also know that it will be more difficult to change tax law to their liking in the next term of Congress, so it has to happen in the short window between now and January.

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