ProPublica uses leaked IRS data to show how wealth inequality is messed up in this country

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Juiblex

Banned
Sep 26, 2016
500
253
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I only read half the article due to time constraints. The wealthy buy (or are given) stock in companies. The value of these companies grow. It allows the stock holders to obtain wealth. At least on paper. It's not income until they sell the stock. Now most companies should pay out dividends (which are income at the point the dividend is issued) and that should devalue the stock appropriately, but most companies do not participate with dividends. Why give out cash to the stock holders (AKA 401k participants? That's inhumane! /sarcasm

Jeff, Bill, Elon, etc will pay the tax when they sell their stock. Talk to Buffet about issuing a dividend. Oh that's right. He plays by the same rules as every other billionaire.

Berkshire Hathaway (BRK.B) famously doesn’t pay dividends – it has better things to do with its shareholders’ cash – but Chairman and CEO Warren Buffett sure loves collecting them. In 2018 alone, Berkshire raked in $3.8 billion in dividends – “a sum that will increase in 2019,” Buffett said in the annual letter.

What a philanthropist!
 

Matt390

Member
Jun 7, 2019
144
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101
If Bezos leaves his money in Amazon, he has no income to tax. Ditto for Buffet and Berkshire. I don't mind folks building vast wealth in their lifetimes. I do mind billionaires getting the special billionaire welfare tax rate (capital gains rate) when they do sell. I double dog mind when they pass their fortunes on to their heirs without exorbitant taxes being paid.


Letting people keep more of their own money isnt welfare. Everyone has a capital gains tax rate that is lower than their earned income tax rate.
 

Sunburn74

Diamond Member
Oct 5, 2009
5,037
2,615
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Letting people keep more of their own money isnt welfare. Everyone has a capital gains tax rate that is lower than their earned income tax rate.
Bingo.
That's a major problem.
Then you have people claiming depreciation on stuff that is highly valuable and not actually depreciating and then using depreciation from 10 years ago to offset record profits today.
It's a joke.

I think the entire concept of depreciation tax benefits should be wiped out. If your stuff depreciates, that's on you. It shouldn't be a tax write off.
 

Matt390

Member
Jun 7, 2019
144
62
101
Or more likely, their heirs will sell it after they die, and will pay nothing on it.

The US has a death tax. If you try to avoid that one by giving it as a gift to your heirs or anyone before you die, they tax it as if you already died. They call it a gift tax.
 
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hal2kilo

Lifer
Feb 24, 2009
24,225
10,878
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The US has a death tax. If you try to avoid that one by giving it as a gift to your heirs or anyone before you die, they tax it as if you already died. They call it a gift tax.
You apparently don't know all the legal vehicles the uber wealthy use to transfer their wealth untouched to the lucky sperm lottery winners.
 
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woolfe9998

Lifer
Apr 8, 2013
16,189
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The US has a death tax. If you try to avoid that one by giving it as a gift to your heirs or anyone before you die, they tax it as if you already died. They call it a gift tax.

Yes, and there is currently an $11.7 million exemption per individual, $23.4 million per couple. That is before you get to the various creative trusts which are used to avoid it.

I know this stuff pretty well as my wife is an estate planning attorney and she helps her wealthy clients do this all the time.
 

pete6032

Diamond Member
Dec 3, 2010
7,675
3,218
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I mean, that's not really surprising. He's paying the current ridiculous 0.1% that the IRS and the law allows him to achieve. It doesn't dismiss his argument that these laws should be changed and he should pay more. That's the kind of thing that an illiterate conservative with someonelse's mind would say during a playground rant.

People are most often going to work within the law, and certainly work for their best efficiency.
This is the bullshit argument conservatives throw around. Look, AOC got a $312 haircut, she can't possibly be in favor of the working class. Look, Buffet is paying 0.1%, he can't possibly be in favor of taxing the rich! The truth is, as you pointed out, that you can participate in our current system to your own benefit while still trying to reform the system to make it more fair. Republicans don't understand that, or don't want to acknowledge that.
 

sactoking

Diamond Member
Sep 24, 2007
7,582
2,817
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Bingo.
That's a major problem.
Then you have people claiming depreciation on stuff that is highly valuable and not actually depreciating and then using depreciation from 10 years ago to offset record profits today.
It's a joke.

I think the entire concept of depreciation tax benefits should be wiped out. If your stuff depreciates, that's on you. It shouldn't be a tax write off.
That's... that's not how depreciation works.

Accounting, both GAAP and tax, allows that businesses that spend money on expenses can deduct those expenses when calculating net income. Some expenses, like a ream of paper, are presumed to be used within the reporting period (typically one year). Other expenses, like a new truck, are presumed to last longer than one reporting period. An extension of accounting's conservatism principle dictates that, to the extent possible, expenses should be matched to the periods in which they generate revenue. This is the underlying principle for depreciation. An expense like a new truck is presumed to generate revenue for more than one reporting period so instead of deducting the entire expense in the period of purchase the expense is depreciated (i.e., stretched out) over the life of the asset. This is true in both GAAP and tax accounting (though they may have different definitions of how long an asset and its corresponding depreciation period may last.)

If you want to wipe out depreciation tax benefits then you need to better define what you want in place. Technically, depreciation isn't a tax benefit. In the absence of depreciation an expense would be claimed 100% in the year in which it was paid. The conventional wisdom is that tax deductions now are more valuable than tax deductions in the future (which is why most businesses try to find ways to accelerate depreciation and not prolong it) so eliminating depreciation would theoretically be worse for society. Plus to the extent that accelerated depreciation generates businesses losses, those losses can be carried forward (and perhaps backward) to offset gains in other periods. So the practical net benefit is essentially zero.

If you mean that deduction of expenses should be wiped out and the tax code should be based on net receipts and not net income, well, good luck with that.
 

Ajay

Lifer
Jan 8, 2001
16,094
8,109
136
This is the bullshit argument conservatives throw around. Look, AOC got a $312 haircut, she can't possibly be in favor of the working class. Look, Buffet is paying 0.1%, he can't possibly be in favor of taxing the rich! The truth is, as you pointed out, that you can participate in our current system to your own benefit while still trying to reform the system to make it more fair. Republicans don't understand that, or don't want to acknowledge that.
Nah, one loses standing then, and the moral high ground. I think WB is close to useless. If I had bought BH stock many years ago as recommended by a friend, I would think a tiny bit better of him.
 

MrSquished

Lifer
Jan 14, 2013
23,085
21,204
136
The US has a death tax. If you try to avoid that one by giving it as a gift to your heirs or anyone before you die, they tax it as if you already died. They call it a gift tax.
You clearly didn't read the article that talks about how they avoid these things and you clearly don't know about things called trusts, etc ..
 
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Juiblex

Banned
Sep 26, 2016
500
253
136
Yes. And it shows.
Couldn't help yourself from making an insult? Sorry, but some of us have to work for a living... Maybe you should try it someday. And you mentioned trusts, yup... So what are you going to do about it? Keep electing the democrats (or republicans) that continue to keep the laws in place for trusts to avoid death tax?

It will never happen because of this... But keep on trying.

Your mulitple anti-semitic attachments to this post have been removed and are not welcome here.

Perknose
Forum Director
 
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blackangst1

Lifer
Feb 23, 2005
22,902
2,359
126
Interesting read...but it seems the author is co-mingling income and wealth. Two different things, with different tax liabilities. The article does correctly state the wealthy take advantage of tax breaks others cannot, well duh. It take a certain amount of wealth to even qualify for these (legal) shelters.

This is a good point in the article:
the concept that income comes only from proceeds — when gains are “realized” — has been the bedrock of the U.S. tax system. Wages are taxed. Cash dividends are taxed. Gains from selling assets are taxed. But if a taxpayer hasn’t sold anything, there is no income and therefore no tax (i.e. wealth).
Ending comment mine.
 
Feb 4, 2009
35,248
16,716
136
Explain please.
I’ll do it but keep in mind I am role playing comment.


Couldn't help yourself from making an insult? Sorry, but some of us have to work for a living... Maybe you should try it someday. And you mentioned trusts, yup... So what are you going to do about it? Keep electing the democrats (or republicans) that continue to keep the laws in place for trusts to avoid death tax?

It will never happen because of this... But keep on trying.

Look at all those guys kissing Jew Banker asses, with their stupid Cuck Bernies. Look at those asshole.


Couldn't help yourself from making an insult? Sorry, but some of us have to work for a living... Maybe you should try it someday. And you mentioned trusts, yup... So what are you going to do about it? Keep electing the democrats (or republicans) that continue to keep the laws in place for trusts to avoid death tax?

It will never happen because of this... But keep on trying.

image to preserve it

F7CE0806-B15F-4F86-A264-37F105FA93B3.png
 

pcgeek11

Lifer
Jun 12, 2005
21,632
4,685
136
Won’t happen when one party is catering exclusively to morons who are easily convinced that the Blacks and Latinos are stealing their tax dollars.

Who did you vote for at any level that has expressed an interest in doing that or even identified it as an issue?

If you want to be honest about it neither side has done shit to address the holes for the wealthy.
 

Ajay

Lifer
Jan 8, 2001
16,094
8,109
136
If you want to be honest about it neither side has done shit to address the holes for the wealthy.
Sure the Democrats have failed thus far. But,there are allot of Democrats currently in office who want to, who have the political will to change that batting record. But, honestly, the tax issue is just too sweet of a political screw for the Republicans to pass on. There are no Republicans who want to raise taxes on corporations or the wealthy; not that I’m aware of.
 
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Exterous

Super Moderator
Jun 20, 2006
20,481
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Yes, and there is currently an $11.7 million exemption per individual, $23.4 million per couple. That is before you get to the various creative trusts which are used to avoid it.

I know this stuff pretty well as my wife is an estate planning attorney and she helps her wealthy clients do this all the time.

My biggest concern is that if anything is tried, meaningful reform won't get passed. There are a lot of options and alternatives out there so any kind of reform would need to be well thought out. Republicans won't support that and I doubt enough Democrats will so, if we end up with anything, it'll be a band aid that just gets a fraction of the promised income as most money just gets shifted to different assets and vehicles while the reform is being touted as a big success so 'we don't need to do anything else' for a long time

Not true. If you're a working slob you get to pay full rate income tax on your 401k earnings.

Good chance you'll be paying a lower income tax rate in retirement than while working so that totally evens things out
 
Nov 8, 2012
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It would be great if either or both parties would work to fix the system.
Lol prepare for a ton of "We would! If only if it weren't for those republitards!"

Except .. oh wait, they have a majority now, and they had one plenty under Obama. They will continue to pull excuses out of their ass just like rabbits though.
 
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Nov 8, 2012
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That's... that's not how depreciation works.

Accounting, both GAAP and tax, allows that businesses that spend money on expenses can deduct those expenses when calculating net income. Some expenses, like a ream of paper, are presumed to be used within the reporting period (typically one year). Other expenses, like a new truck, are presumed to last longer than one reporting period. An extension of accounting's conservatism principle dictates that, to the extent possible, expenses should be matched to the periods in which they generate revenue. This is the underlying principle for depreciation. An expense like a new truck is presumed to generate revenue for more than one reporting period so instead of deducting the entire expense in the period of purchase the expense is depreciated (i.e., stretched out) over the life of the asset. This is true in both GAAP and tax accounting (though they may have different definitions of how long an asset and its corresponding depreciation period may last.)

If you want to wipe out depreciation tax benefits then you need to better define what you want in place. Technically, depreciation isn't a tax benefit. In the absence of depreciation an expense would be claimed 100% in the year in which it was paid. The conventional wisdom is that tax deductions now are more valuable than tax deductions in the future (which is why most businesses try to find ways to accelerate depreciation and not prolong it) so eliminating depreciation would theoretically be worse for society. Plus to the extent that accelerated depreciation generates businesses losses, those losses can be carried forward (and perhaps backward) to offset gains in other periods. So the practical net benefit is essentially zero.

If you mean that deduction of expenses should be wiped out and the tax code should be based on net receipts and not net income, well, good luck with that.
You're talking to complete idiots that don't even know what GAAP is - let alone what an accounting method is and that there are multiple of them for different purposes.


They continue to peddle stupid shit while not understanding simple 3rd grade facts like the bottom 50% of our country is either a net negative on our federal income tax or at most neutral (pays 0$)
 
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Sunburn74

Diamond Member
Oct 5, 2009
5,037
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That's... that's not how depreciation works.

Accounting, both GAAP and tax, allows that businesses that spend money on expenses can deduct those expenses when calculating net income. Some expenses, like a ream of paper, are presumed to be used within the reporting period (typically one year). Other expenses, like a new truck, are presumed to last longer than one reporting period. An extension of accounting's conservatism principle dictates that, to the extent possible, expenses should be matched to the periods in which they generate revenue. This is the underlying principle for depreciation. An expense like a new truck is presumed to generate revenue for more than one reporting period so instead of deducting the entire expense in the period of purchase the expense is depreciated (i.e., stretched out) over the life of the asset. This is true in both GAAP and tax accounting (though they may have different definitions of how long an asset and its corresponding depreciation period may last.)

If you want to wipe out depreciation tax benefits then you need to better define what you want in place. Technically, depreciation isn't a tax benefit. In the absence of depreciation an expense would be claimed 100% in the year in which it was paid. The conventional wisdom is that tax deductions now are more valuable than tax deductions in the future (which is why most businesses try to find ways to accelerate depreciation and not prolong it) so eliminating depreciation would theoretically be worse for society. Plus to the extent that accelerated depreciation generates businesses losses, those losses can be carried forward (and perhaps backward) to offset gains in other periods. So the practical net benefit is essentially zero.

If you mean that deduction of expenses should be wiped out and the tax code should be based on net receipts and not net income, well, good luck with that.
It may sound crazy but I don't think expenses for a business should be tax deductible.

My expenses for generally living are not tax deductible. Why should a businesses expenses be deductible?
 
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