Ask YC: Startups and Obama | Hacker News Reader

Ask YC: Startups and Obama

6 pointskajecounterhack17 comments

Sole Proprietorships: Taxes raised from 35% to 50% (accounting for payroll, medicaid taxes)

S-Corporations: Taxes raised from 34% to 40%

Obama Healthcare: Paid for by repealing Bush tax cuts

Taxes in general: Raised during a recession. Last president to do so: Herbert Hoover (Hawley Smoot Tariff)

Discuss.

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Um...you might want to get your information from places other than talk radio.

Oh and I thought pg specifically said that politics would be kept out except for the 1 discussion/winner thread

Over/under on how long until this thread is deaded is...?

you missed a few other points:

Startups: no capital gains taxes.

Sole proprietorships: tax benefits to offset the double taxation in the policy change.

Small Business Incubators: public/private incubator network developed to help promote small business growth and innovation.

re: the herbert hoover thing -- invalid comparison. back in the day, we actually had a balanced budget, and the increase hoover imposed more than doubled the top tax bracket rates. in addition, hoover tried to pass tax cuts first, but almost every politician said it would be a sign of weakness in the face of economic turmoil.

I'm still unclear on the startup capital gains thing. Startups generally don't pay them until they exit. So presumably the only people saving money are ones who have small exits? I'm sure he's still going to tax founders of the next Google handsomely.

Those are top tax rates right? There's little evidence that reasonable increases in top tax rates have any effect on new businesses. Ridiculous taxes (like the 70% we had under Carter) clearly do, but there's almost no difference in terms of businesses started in any rate under 40%.

I'm not sure where these numbers are coming from. Sole proprietors file Schedule C on their personal returns, and S Corporation taxes are passed through to individual owners' returns, as well. That implies they should be paying the same rate; there is no separate S Corporation tax rate. If Obama (with Congress) cuts taxes on 95% of Americans, i.e. people making less than $200K per year, then they'll also be cutting taxes on the vast majority of subchapter-S corporations and sole proprietors.

Also of potential interest on this topic, the effect of changes in the Marginal Tax Rate on small business formation in the United States:

http://www.aarongreenspan.com/filing/mtr.pdf

I thought that the taxes were raised on profits from 250.000 upwards? As in, you pay 34% on your first 250.000, and if you earn 300.000, you pay 40% on the remaining 50.000.

Off-topic but is using a "." instead of a "," in number digit groups standard in some countries? I swear I see that quite often.

It's relatively common outside of the US. See: http://en.wikipedia.org/wiki/Decimal_separator#Countries_usi...

Yes, it is.

To keep things in perspective: the vast majority of Americans don't own small businesses or start-up companies.

+ Obama specifically exempts startups from those "huge" increases the McCainiacs scare people with

+ top tax rates are nowhere near the entire story. He's giving big cuts to earlier stage companies.

And in Massachusetts, a question is up to repeal state taxes... what do you guys think about that?

http://www.forbes.com/enterprisetech/2008/09/04/barak-obama-...

Gotta call b.s. here. That article is very partisan (hence the use of the word 'socialist'), and at odds with what most economists think. See both http://www.economist.com/world/unitedstates/displaystory.cfm... and http://www.cnn.com/2008/POLITICS/09/16/dilbert.economy/index...

It's time for a change?

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