Disincentives to work

Taxes are always and everywhere a creator of inefficiency: inefficiency of supply, inefficiency of demand, inefficiency of labor. Michellen Malkin comments today on an article from ABC News about how people making more than the magical $250,000 Obama threshold are looking at ways to make $249,999.
This is my favorite quote, and it's straight out of Economics 101:

Dr. Sharon Poczatek, who runs her own dental practice in Boulder, Colo., said that she too is trying to figure out ways to get out of paying the taxes proposed in Obama's plan.

"I've put thought into how to get under $250,000," said Poczatek. "It would mean working fewer days which means having fewer employees, seeing fewer patients and taking time off."

"Generally it means being less productive," she said.

It's not just the increase in the tax rate at the quarter-million dollar mark, it's also Obama's proposed itemized deductions reduction. Some of those proposed changes include lower deductibility percentages on charitable contributions and mortgage interest. The former will significantly hurt the non-profit industry since the typical large donor is also a high income earner. The housing market will also take a(nother) hit if mortgage interest is not deductible to the full amount. It wouldn't necessarily be an incentive to sell an existing home, but it would likely be a consideration as to the purchase of a larger versus a smaller home.
Who would actually be able to do this? My guess is small business owners who make between $250-300k are the most likely candidates. Much more than that, and voluntary decrease in income exceeds the avoided tax hit. Anyone who has the ability and desire to change their annual income to a large degree, such as consultants, sales reps, or those living on investment income, have an opportunity. Don't underestimate how many people we're talking about here. The aggregate job loss (see quoted text above) plus the loss of money flowing through the system (because when people don't bring in the income, they don't spend it either)...it's just one more straw on the economic camel's back.