Can We Cry for the Poor People Making Over $225,000 a Year?

People making over $225,000 must have it much tougher than the rest of us since the media highlight their problems so frequently. In discussing the housing market and the homebuyers' tax credit USA Today told readers: "Many potential buyers in higher-price markets such as New York, Boston, Hawaii and San Francisco won't qualify because their incomes are too high. Under the income limits, single taxpayers with incomes up to $125,000 and married couples with incomes up to $225,000 qualify for the full tax credit."

This group accounts for less than 2 percent of families. Given the difficulty facing these upper income taxpayers, it would no doubt make sense to impose higher taxes on renters earning $70,000 so that these potential homebuyers can also get the full benefit of the tax credit (btw, this is a phase out, not a cutoff, so even families earning somewhat above $225,000 will still be getting some money from more moderate income taxpayers for doing the public the service of buying a big home.)

--Dean Baker

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