For most folks, it is the little taxes that bite the most, not the big tax: the federal personal income tax. Hotelier Leona Helmsley once said, “We don’t pay taxes. Only the little people pay taxes.” That’s not quite true, as “the little people” often don’t pay the big tax. The bottom 40 percent of income earners have a negative income tax rate. The only people in the bottom 40 percent who actually pay the personal income tax are anomalies. For Leona, they’d be “the little people.” But others might see them as the collateral damage of an insane tax system. In a June 2016 report from the Congressional Budget Office, we see at the bottom of page 11 that the four lowest before-tax income quintiles in 2013 had average effective tax rates of -7.2, -1.2, +2.6, and +6.1 percent. That translates into an average effective tax rate for the bottom 80 percent of personal income earners in 2013 of just +0.075 percent -- not even one...(Read Full Article)