What is the proposed Bonus Tax legislation?
After just 40 minutes of debate, the US House of Representatives quickly passed bill HE 1586 on 3/19/09. The bill will tax employees who work or worked at companies that received more than $5 billion in federal aid. Employees who get a bonus and have a combined household income over $250,000 will have their bonuses taxed at a federal tax rate of 90%. State and local taxes would likely tax the remaining 10%. The target of the bill was bonuses paid by AIG but this bill has far-reaching effects. This bonus tax legislation is an unprecented step toward class warfare by using the US tax code to penalize one class of people. This legislation also discriminates against those that are married and have dual income families. The House bill is retroactive to 1/1/09 which may not even pass judicial review. Congress needs to take a deep breath and understand that this will affect others besides AIG executives. The legislation still needs to pass the Senate and be signed by President Obama. There is still time to stop this insanity!
Who will be affected?
This bill will affect any employee who earns a bonus from a "bailed out" company and who has a household income of more than $250,000. A married person filing as single will be subject to a $125,000 income limit. This bill does not just go after AIG bonuses as many of those in Congress and the media portray. This bill goes after employee bonuses at companies like Fannie, Freddie, JP Morgan Chase, Bank of America, Citigroup, etc. Think only executives are being targeted? Think again. Here are some examples of people who would be affected:
Example 1: IT analyst earns salary of $70,000 and a bonus of $5,000. Spouse earns $120,000 at his/her own job. The couple has other investment income of $60,000 per year. Total household income is $250,000 so the $5,000 bonus will be taxed at 90%.
Example 2: HR manager aged 65 earns $120,000 this year and a $20,000 bonus. Employee retires and cashes in some retirement investments. Household income is over $250,000 so bonus will be taxed at 90%.
Example 3: Employee A earns $60,000 this year and gets a $120,000 bonus. The employee is single so his/her household income is less than $250,000. A coworker of employee A earns the same as employee A but is married with a household income over $250,000 so his/her bonus will be taxed at 90%. If the coworker files as single on his/her taxes, he/she will still be taxed at 90% because of the $125,000 limit for a married person filing as single. However, employee A will not be taxed because he/she is single. Talk about a marriage tax!
Many employees are commission/bonus based and their livelihoods are at risk with this bonus tax legislation! Also, many employees work at profitable business units within the "bailed out" companies and deserve bonuses for their hard work. This legislation simply targets households making over $250,000 where one or both family members works at a "bailed out" company. Eliminating bonuses will only cause attrition and cause further disruption and losses at the "bailed out" companies. How is this supposed to help America get out of the worst economic crisis since the Great Depression?
What can I do to stop this insanity?
Contact your US House and Senate representatives and tell them to vote AGAINST the bonus tax legislation! Tell them to take a step back and think about the possible consequences of this unprecented legislation.
Link to contact your US Senate Senator: http://www.senate.gov/general/contact_information/senators_cfm.cfm?State=
Link to contact your US House Representative: https://writerep.house.gov/writerep/welcome.shtml
Be sure to spread the word about this website to your friends, coworkers, neighbors etc!
House Member Vote on HB 1586.
| State | Yes | No | No Vote |
| Robert Aderholt, Bobby Bright, Artur Davis, Parker Griffith, Mike Rogers | Spencer Bachus, Jo Bonner | ||
| Alaska | Don Young | ||
| Arizona | Gabrielle Giffords, Raul Grijalva, Ann Kirkpatrick, Ed Pastor | Jeff Flake, Trent Franks, Harry Mitchell, John Shadegg | |
| Arkansas | Marion Berry, John Boozman, Mike Ross | Vic Snyder | |
| California | Joe Baca, Xavier Becerra, Howard Berman, Brian Bilbray, Mary Bono, Ken Calvert, Lois Capps, Dennis Cardoza, Jim Costa, Susan Davis, Anna Eshoo, Sam Farr, Bob Filner, Elton Gallegly, Jane Harman, Wally Herger, Mike Honda, Barbara Lee, Jerry Lewis, Zoe Lofgren, Doris Matsui, Tom McClintock, Jerry McNerney, George Miller, Laura Richardson, Dana Rohrabacher, Lucille Roybal-Allard, Edward Royce, Loretta Sanchez, Adam Schiff, Brad Sherman, Jackie Speier, Pete Stark, Linda Sanchez, Ellen Tauscher, Mike Thompson, Maxine Waters, Diane Watson, Henry Waxman, Lynn Woolsey | John Campbell, David Dreier, Duncan Hunter, Darrell Issa, Daniel Lungren, Kevin McCarthy, Buck McKeon, Devin Nunes | Gary Miller, Grace Napolitano, George Radanovich |
| Colorado | Diana DeGette, Betsy Markey, Ed Perlmutter, Jared Polis, John Salazar | Michael Coffman, Doug Lamborn | |
| Connecticut | Joe Courtney, Rosa DeLauro, James Himes, John Larson, Christopher Murphy | ||
| Delaware | Michael Castle | ||
| Florida | Gus Bilirakis, Allen Boyd, Corrine Brown, Ginny Brown-Waite, Vern Buchanan, Kathy Castor, Ander Crenshaw, Mario Diaz-Balart, Lincoln Diaz-Balart, Alan Grayson, Alcee Hastings, Ron Klein, Suzanne Kosmas, Kendrick Meek, John Mica, Adam Putnam, Thomas Rooney, Ileana Ros-Lehtinen, Cliff Stearns, Debbie Wasserman Schultz, Robert Wexler, Bill Young | Connie Mack, Jeff Miller, Bill Posey | |
| Georgia | John Barrow, Sanford Bishop, Hank Johnson, John Lewis, Jim Marshall, David Scott | Paul Broun, Nathan Deal, Phil Gingrey, Jack Kingston, John Linder, Tom Price, Lynn Westmoreland | |
| Hawaii | Neil Abercrombie, Mazie Hirono | ||
| Idaho | Walt Minnick, Michael Simpson | ||
| Illinois | Judith Biggert, Jerry Costello, Danny Davis, Bill Foster, Luis Gutierrez, Deborah Halvorson, Phil Hare, Jesse Jackson, Tim Johnson, Mark Kirk, Daniel Lipinski, Donald Manzullo, Peter Roskam, Bobby Rush, Jan Schakowsky, Aaron Schock, John Shimkus | Melissa Bean | |
| Indiana | André Carson, Joe Donnelly, Brad Ellsworth, Baron Hill, Peter Visclosky | Dan Burton, Steve Buyer, Mike Pence | Mark Souder |
| Iowa | Leonard Boswell, Bruce Braley, Tom Latham, David Loebsack | Steve King | |
| Kansas | Dennis Moore, Jerry Moran | Lynn Jenkins, Todd Tiahrt | |
| Kentucky | Ben Chandler, Geoff Davis, Brett Guthrie, Hal Rogers, Ed Whitfield, John Yarmuth | ||
| Louisiana | Rodney Alexander, Anh Cao, Bill Cassidy, John Fleming, Charles Melancon | Steve Scalise | Charles Boustany |
| Maine | Michael Michaud, Chellie Pingree | ||
| Maryland | Elijah Cummings, Donna Edwards, Steny Hoyer, Frank, Kratovil, Dutch Ruppersberger, John Sarbanes, Chris Van Hollen | Roscoe Bartlett | |
| Massachusetts | Michael Capuano, Barney Frank, Stephen Lynch, Edward Markey, James McGovern, Richard Neal, John Olver, John Tierney, Niki Tsongas | William Delahunt | |
| Michigan | Dave Camp, John Conyers, John Dingell, Vernon Ehlers, Peter Hoekstra, Dale Kildee, Carolyn Kilpatrick, Sander Levin, Candice Miller, Gary Peters, Mike Rogers, Mark Schauer, Bart Stupak, Fred Upton | Thad McCotter | |
| Minnesota | Keith Ellison, Betty McCollum, James Oberstar, Collin Peterson, Timothy Walz | Michele Bachmann, John Kline, Erik Paulsen | |
| Mississippi | TRAVIS Childers, Gene Taylor, Bennie Thompson | Gregg Harper | |
| Missouri | Roy Blunt, Russ Carnahan, William Clay, Emanuel Cleaver, Jo Ann Emerson, Ike Skelton | Todd Akin, Sam Graves, Blaine Luetkemeyer | |
| Montana | Dennis Rehberg | ||
| Nebraska | Jeff Fortenberry | Adrian Smith, Lee Terry | |
| Nevada | Shelley Berkley, Dean Heller, Dina Titus | ||
| New Hampshire | Paul Hodes, Carol Shea-Porter | ||
| New Jersey | John Adler, Robert Andrews, Rodney Frelinghuysen, Rush Holt, Leonard Lance, Frank LoBiondo, Frank Pallone, Bill Pascrell, Donald Payne, Steven Rothman, Albio Sires, Christopher Smith | Scott Garrett | |
| New Mexico | Martin Heinrich, Ben Lujan, Harry Teague | ||
| New York | Gary Ackerman, Michael Arcuri, Timothy Bishop, Yvette Clarke, Joseph Crowley, Eliot Engel, John Hall, Brian Higgins, Steve Israel, Christopher Lee, Nita Lowey, Daniel Maffei, Carolyn Maloney, Eric Massa, Carolyn McCarthy, John McHugh, Gregory Meeks, Jerrold Nadler, Charles Rangel, Jose Serrano, Louise Slaughter, Paul Tonko, Edolphus Towns, Nydia Velazquez, Anthony Weiner | Peter King, Michael McMahon | Maurice Hinchey |
| North Carolina | G.K. Butterfield, Bob Etheridge, Walter Jones, Mike McIntyre, Brad Miller, David Price, Heath Shuler, Melvin Watt | Howard Coble, Virginia Foxx, Larry Kissell, Patrick McHenry, Sue Myrick | |
| North Dakota | Earl Pomeroy | ||
| Ohio | John Boccieri, Steve Driehaus, Marcia Fudge, Marcy Kaptur, Mary Kilroy, Dennis Kucinich, Tim Ryan, Jean Schmidt, Zachary Space, Betty Sutton, Pat Tiberi, Michael Turner, Charles Wilson | Steve Austria, John Boehner, Jim Jordan, Steven LaTourette, Robert Latta | |
| Oklahoma | Dan Boren | Tom Cole, Mary Fallin, Frank Lucas, John Sullivan | |
| Oregon | Earl Blumenauer, Peter DeFazio, Kurt Schrader, Greg Walden, David Wu | ||
| Pennsylvania | Jason Altmire, Robert Brady, Christopher Carney, Kathy Dahlkemper, Charles Dent, Michael Doyle, Chaka Fattah, Jim Gerlach, Tim Holden, Paul Kanjorski, Patrick Murphy, John Murtha, Todd Platts, Allyson Schwartz, Joe Sestak | Tim Murphy, Joe Pitts, Bill Shuster, Glenn Thompson | |
| Rhode Island | Patrick Kennedy, James Langevin | ||
| South Carolina | Henry Brown, James Clyburn, John Spratt | J. Gresham Barrett, Bob Inglis, Joe Wilson | |
| South Dakota | Stephanie Herseth Sandlin | ||
| Tennessee | Steve Cohen, Jim Cooper, John 'Jimmy' Duncan, Bart Gordon, Phil Roe, John Tanner, Zachary Wamp | Marsha Blackburn | Lincoln Davis |
| Texas | Joe Barton, Henry Cuellar, Lloyd Doggett, Chet Edwards, Charles Gonzalez, Gene Green, Al Green, Ruben Hinojosa, Sheila Jackson-Lee, Eddie Johnson, Michael McCaul, Solomon Ortiz, Silvestre Reyes, Ciro Rodriguez, Lamar Smith | Kevin Brady, Michael Burgess, John Carter, Michael Conaway, Louie Gohmert, Kay Granger, Ralph Hall, Jeb Hensarling, Sam Johnson, Kenny Marchant, Randy Neugebauer, Ron Paul, Ted Poe, Pete Sessions, Mac Thornberry | John Culberson, Pete Olson |
| Utah | Jim Matheson | Rob Bishop, Jason Chaffetz | |
| Vermont | Peter Welch | ||
| Virginia | Rick Boucher, Eric Cantor, Gerry Connolly, Randy Forbes, Bob Goodlatte, James Moran, Glenn Nye, Tom Perriello, Robert Scott, Robert Wittman, Frank Wolf | ||
| Washington | Brian Baird, Norman Dicks, Jay Inslee, Rick Larsen, Jim McDermott, Cathy McMorris Rodgers, David Reichert, Adam Smith | Doc Hastings | |
| West Virginia | Shelley Moore Capito, Alan Mollohan, Nick Rahall | ||
| Wisconsin | Tammy Baldwin, Steve Kagen, Ron Kind, Gwen Moore, David Obey, Thomas Petri, Paul Ryan | Jim Sensenbrenner | |
| Wyoming | Cynthia Lummis |