To Whom It May Concern,
I would like to ask that the Oredigger apply a stronger hand in examining the pieces that are published by its writers, and hold writers to a higher standard of reporting. I reference the story “Obama’s optimism not enough to bring jobs” in the Sept 19th issue. Your writer Will Parker states “But one must consider that many of these people own Limited Liability Companies (LLCs), an LLC is a pass-through-entity, meaning that the LLC’s income is reported on the owner’s tax return and the owner of the LLC is taxed not just for their personal profit but also their business’s profit.
This means that a business owner who takes home $200,000 a year may have a reported income of over a million a year because of their business’s profit. The majority of that profit they spend by reinvesting in the company, thus creating more jobs, but they are taxed for the entire thing.”
Let’s apply a simple logic test to the writer’s statement that they pay income taxes on over $1,000,000 but only earn $200,000. According to http://www.moneychimp.com/features/tax_brackets.htm an income of $1,000,000 would generate an income tax payment of $327,314, far said person’s $200,000 income. So, according to your staff writer, that person is taking out a loan of $127,314 every year to pay off his or her income tax. And that would be on the low side as your writer said “over a million a year” and I used only $1,000,000 as an example. Clearly this throws a large wrench in the writer’s claims and theories and I would sincerely wish that a claim so blatantly wrong would be noticed and the writer would be required to provide more information or sources to back up his claim and support his story.
I would hope that the Oredigger Newspaper, being an entity of the Colorado School of Mines, would conduct itself in a manor reflecting our school’s scientific and academic background and not print such groundless claims, which cannot stand up to a simple common sense test.
Perhaps you could refer the writer to the section of their research (they DID provide you research to back up their story right?) which discusses deductions and write-offs (where the person would show that they reinvested the money back to the business and thus not pay income tax on that portion).