One thing that will happen on a significant basis, I assure you - high income earners with college-age and adult children will begin transferring wealth to them by creating sinecure employment for them. If they take a dollar of gross revenue and their options are to pay themselves at e.g. 50% tax, and give it to their college age son for non-deductible living expenses, or put him on the payroll and let him pay 20%, guess which they'll do?

For example, right now a couple earning $300,000 with two kids pays about $72,592 in federal taxes (using just standard deduction rather than getting complicated with itemized deduction to keep this easy).

That means they take home (after we consider medicare and social security) $216,437.

With the coming proposed changes, if they remain married, their tax burden increases to $82,023 and all else remaining the same, they now have $207,006 they take home - or $9,431 less after the tax increase.

If they instead divorce and split their income into two returns, one single and one single + 2, their after-tax situation changes dramatically...where for the same couple, they now have $234,036 instead of $207,006....or will take home $27,030 MORE despite the tax increase...so that's why I think we'll see more divorces - quick, down and dirty way to capture and increase take-home for the couple.

So there is a balance. When I hear the lady above, I hear echoes of those who got too fancy.

As "yetanotherjohn" hints at, above, and as some folks seem to miss, you don't in fact have more money that you control if you're just above a trigger point. Sure, I'd rather have a salary of 300K vs. 249K, but 250K vs. 249K? I'd have to run the numbers. (I wish I were making anything in this range, of course).

If I were a small business owner - possibly including a partner in a law firm - I could see reducing my income while increasing the number of low-paid employees I had, cutting back my own hours because the value of each extra hour vs. the cost of another employee. I don't see why that's a surprise, it's nothing new. It's just math. And yes, this may not be a change that hits for another year and change, but that doesn't mean that small business owners don't have to start hiring people now if they're cutting back later.

A 63-year-old attorney based in Lafayette, La., who asked not to be named,

Hmmm... Jane Galt, perhaps?

A proprietorship, like the one referenced, has a lot of options to move income around, raise expenses/benefits, shift income into capital, etc.

“We are going to try to figure out how to make our income $249,999.00,” she said.

Good Lord, how could anyone with that grasp of math make $250K in the first place?

(BTW, the bigger problem for the tax collector's bottom line is that so many folks over $250K have opportunities for tax loss harvesting in the stock markets these days. I'm not sure TLH isn't often zero-sum over the long run, but it can certainly cut tax revenues in a down market.)

At the same time, excess income for small business owners can also cause reevaluation of perks and benefits. The bottom line is the more you tax the financially successful, the more they will have motivation to avoid those taxes.