Americans for Tax Reform has run the numbers for Joe Wurzelbacher. Under the tax plan offered by Barack Obama, the country’s most famous plumber would pay $10,000 more in taxes. Here’s the breakdown:
Current Law: Under current law, Joe faces a self-employment tax of $20,768 and an income tax of $49,908 for a total tax liability of $70,676
Obama Tax Hike: Joe’s self-employment tax his risen to $24,488 since he’s paying the full rate after $250,000 of SE tax. His income tax liability has risen to $56,090. This gives him a total tax liability of $80,578
So, Joe can expect to pay almost $10,000 more under the Obama tax hike under a worst case scenario.
Americans for Tax Reform provides the complete methodology on its blog. And while Heritage’s Center for Data Analysis didn’t single out Joe the Plumber when crunching the numbers, it has produced its own exhaustive analysis of the McCain and Obama tax plans.
UPDATE — 7:42 p.m.: Wonder how Joe the Plumber would fare under McCain’s plan? Americans for Tax Reform says not much would change. Because Joe is a sole proprietor, he pays business taxes on his 1040. It’s the marginal tax rate changes proposed by Obama that make all the difference.