The good news is, I may soon be making more money. The bad news is, if it happens, I won't see a penny of it.

One of the now-dead proposals of the Democrats is a tax on what is known as "imputed income". Imputed income isn't actually income you earn, but income you actually SAVE!

For instance, if you make a table instead of buying it at the store, the table has an "imputed value" equal to the difference between what you paid for materials and the retail cost of a similar table.

One of many problems with imputed value is that it is difficult to determine actual imputed income.

But here's where it gets fun. Say you live in a neighborhood where the average home rents for $1000 a month and your mortgage payments are $600 a month. You have an "imputed income" of $400 a month. Now say you OWN that home outright. Your "imputed income" rises to $1000 a month. You just made $12,000 more according to the IRS and you get to pay taxes on that extra "income". In other words, you pay a penalty for owning your own property.

We have a home that we bought for back taxes. Aside from taxes, nothing is owed on it. By the end of 2009, taxes will be paid up. If the idea of "imputed income" comes back to the table, we will see an increase in our level of taxation. Now, while we have kids at home that's not a problem. But if the idea of an "imputed income" tax passes, we could see ourselves OWING money when we are in retirement.

Now, I must say, to be absolutely fair, that nobody in the Obama campaign has outwardly proposed the tax on imputed income. But because this idea was proposed as a Democratic measure for reform, it is not entirely unforeseeable that it could be brought up under a new Congress led by Democrats.

I don't know if this idea will get any traction, and it absolutely may not. But if it does, many middle class families could suffer.