According to unconfirmed sources, Barack Obama is being smeared by baseless claims that he would dramatically raise marginal tax rates to levels not seen since the 1970s or impose new taxes on everything from your child’s education fund to your water.

These accusations have no basis in truth and, according to Obama supporters, are repeatedly debunked.  Here are some key facts about the plan to set the record straight:

1) The Obama Plan Provides Generous Tax Cuts for Almost All American Families
The Obama plan will the typical family will pay tax rates that are 20% lower than they faced under President Reagan. Any and all charges that Obama would raise rates on capital gains, dividends, income, savings and so on for the approximately 98% of American families making less than $250,000 are simply not true.

2) The Obama Plan Would Cut Taxes For Middle Class Families By Three Times More Than Senator McCain’s Plan.
In recent weeks, the McCain campaign has repeatedly suggested that Obama voted to increase taxes on families making $42,000 per year. Factcheck.org declared this claim “simply false,” and the Washington Post Editorial Board determined that this claim was “unacceptably misleading.”

3) Under the Obama Plan, No One Will Pay Higher Tax Rates Than They Paid in The 1990s
Barack Obama believes that any responsible candidate must put forward specific ideas of how they would pay for their proposals to put us back onto the path of fiscal responsibility. That is why he has called for repealing a portion of the tax cuts passed in the last eight years for families making over $250,000. But he would limit all rates to be at or below what they were in the 1990s. Families making over $250,000 would pay the 1990s marginal income tax rates – of 39.6 and 36 percent – and capital gains and dividend tax rates of 20%. Obama’s 20 % capital gains rate is the lowest rate from the 1990s, and his 20% dividends rate is 39 percent lower than the rate President Bush proposed in 2001, and lower than all but 5 of the last 92 years we have been taxing dividends.

4) Obama Would Lower Taxes For the Vast Majority of Small Businesses
This is false because the Obama plan preserves existing tax rates for families making less than $250,000 a year, nearly 99 % of small business owners won’t see any tax increase under the Obama plan. Instead, these small firms and business owners are likely to get a tax cut under the Obama plan, which eliminates capital gains taxes for small businesses, provides a new 50% tax credit for healthcare, and helps lower health care costs to make small businesses competitive.

5) Obama Will Provide New Tax Benefits to Help Families Save and Create Wealth
The notion that Obama will raise taxes on families’ assets like their “homes” or “life savings” is absurd. In radio and TV ads, the McCain campaign has alleged that Barack Obama would increase taxes on “your life savings” or the “sale of your home”—bedrock assets for ordinary Americans. But in fact, Barack Obama and Joe Biden will repeal the estate tax for 99.7% of estates, offer a new universal mortgage tax credit to help working families achieve homeownership, and will offer a new, fully refundable 50% credit on the first $1,000 of retirement savings done by American families. Factcheck.org called these McCain attacks “simply not true for the vast majority of viewers who will see [them]” while the Washington Post called them “dishonest.”

With less than a week before the U.S. election, it seems everyone is focusing on the Obama tax and economic plan, but according to an article published by Bloomberg, McCain’s economic recovery plan deserves to be looked at.  His economic recovery and tax plan calls for cutting the corporate tax, preserving the fifteen percent capital gains tax, letting businesses expense technology and equipment, freezing government spending and seeking long term solutions to economic recovery.  Consider this…

John McCain’s plan to bring down the corporate tax to 25 percent (a .10% cut) would induce foreign investment to remain. It would also continue the rally of the U.S. dollar.

John McCain is sticking to his guns when he says he will make Georg W Bush’s income tax cuts permanent. And he is all for preserving the 15 percent tax rate on capital gains and dividends.  Why is this important?

What experts are discovering about our current financial crisis, is there are plenty of mediocre companies sitting in portfolios.  Many people are trying to get out of them now, and many more will in the future. But if the capital gains rate is increased, it may deter those who otherwise would bail out of these companies. What this does, is prevent the shift of dollars from these “dogs” to investment in new companies with better products.

The McCain plan would speed up the economic recovery and improve the quality of it.  McCain’s plan suggests cutting the capital gains taxes in half in the next two years.  Although not a short term solution to the economic problem, it seems a wise choice in the long run.

A good idea is to allow companies to expense 100% of it’s investment in technology and equipment, in the same year they buy it. The current formula allows companies to write off half of the expense in the first year, and then depreciate the balance over a longer period. This would be especially beneficial to areas of the country that invest in heavy machinery, like Cleveland and Detroit.  However, the McCain plan calls for write-downs over a 3 or 5 year depreciation schedule.

McCain’s plan on energy is to build 45 new nuclear plants by 2030. This “green” energy source would significantly cut U.S. dependence on foreign oil, which would maintain stability in the financial markets. It would also create 700,000 jobs. The construction of these plants could be financed by the U.S. Treasury.

The McCain plan calls for an overall freeze on government spending.  Good luck with this, we’re all smart enough to know that Washington isn’t capable of passing it into law. But McCain’s disposition may help make some inroads on this issue.

McCain’s economic plan is a dynamic one, looking at the growth and competitive environment generated by tax cuts.
As noted in the Bloomberg post,”The Institute for Research on the Economics of Taxation finds that the McCain tax plan would add 0.5 percent to the annual growth rate for the private sector for five years. Obama’s plan would subtract 0.7 percent a year in growth for the same period. As Steve Entin of IRET notes, politicians have hurt growth before by ignoring such effects.

The Obama vision is all static. It’s better to redistribute, he says, because we sure aren’t going to grow. This attitude ignores the possibility of expansion, and it’s one that many lawmakers share, seeing only belt-tightening in the future. On some days, these gloomsters even include McCain.”

John McCain’s tax and economic plan is one that needs to taken seriously.