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High taxes be damned, the rich keep moving to California

latimes.com

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Re: High taxes be damned, the rich keep moving to California

#11

Post by eclipxe »

esf wrote: post #10
gnicholas wrote: post #3

Once tax day has come and the full force of the capped SALT deduction is felt, things may change. A high-earning couple with $500k in combined income (roughly $45k in state taxes) and a $2m home (roughly $20k in local taxes) will go from a $65k deduction to a $10k deduction.

Am half of a high earning couple in a bit above this range in California. Surprisingly, my taxes changed very little this year. In years prior, I always had to pay AMT, in which SALT deductions were already disallowed. The new tax law is basically a wash. I don't pay AMT, just pay higher regular. I didn't check exactly but my effective rate this year may even have gone down a little. Many people in this income range…

Yep, not a fan of the tax plan but it seems like a lot of folks forget about AMT. AMT made state and local tax deductions pointless.

Re: High taxes be damned, the rich keep moving to California

#12

Post by mav3rick »

jlrubin wrote: post #8
scarejunba wrote: post #5

Earlier quoted context omitted.

Broseph, they're paying 28% via federal as well, and social security and Medicare. If it were only 13% marginal that would be whoop-for-joy low.

(In case you're wondering -- you're likely being downvoted for calling the parent 'Broseph' -- it's a bit of a pejorative, which is uncalled for in HN's mostly civil discourse)

I thought it was funny. Why do people get upset so easily.

Re: High taxes be damned, the rich keep moving to California

#13

Post by nostrademons »

gnicholas wrote: post #3

Once tax day has come and the full force of the capped SALT deduction is felt, things may change. A high-earning couple with $500k in combined income (roughly $45k in state taxes) and a $2m home (roughly $20k in local taxes) will go from a $65k deduction to a $10k deduction.

Wealthy != high income.

A high-earning couple might make $500K spread across 2 W-2 salaries, and then pay those $45K in state and ~$200K in federal taxes. A wealthy couple owns a network of business, reinvests all profits of those businesses in capital improvements to make more money in the future, pulls out only enough in salary to meet their expenses, makes an equivalent donation to charity to offset all their "income", and then pays zero in taxes.

Re: High taxes be damned, the rich keep moving to California

#14

Post by CoolGuySteve »

esf wrote: post #10
gnicholas wrote: post #3

Once tax day has come and the full force of the capped SALT deduction is felt, things may change. A high-earning couple with $500k in combined income (roughly $45k in state taxes) and a $2m home (roughly $20k in local taxes) will go from a $65k deduction to a $10k deduction.

Am half of a high earning couple in a bit above this range in California. Surprisingly, my taxes changed very little this year. In years prior, I always had to pay AMT, in which SALT deductions were already disallowed. The new tax law is basically a wash. I don't pay AMT, just pay higher regular. I didn't check exactly but my effective rate this year may even have gone down a little. Many people in this income range…

I’ve been doing the same math for NYC since I work remotely. The thing is, I can still move to another state and not pay state taxes or AMT.

I like NYC but I’m not sure I still like it tens of thousands of dollars much after this latest tax reform.

Re: High taxes be damned, the rich keep moving to California

#15

Post by syspec »

nostrademons wrote: post #13
gnicholas wrote: post #3

Once tax day has come and the full force of the capped SALT deduction is felt, things may change. A high-earning couple with $500k in combined income (roughly $45k in state taxes) and a $2m home (roughly $20k in local taxes) will go from a $65k deduction to a $10k deduction.

Wealthy != high income. A high-earning couple might make $500K spread across 2 W-2 salaries, and then pay those $45K in state and ~$200K in federal taxes. A wealthy couple owns a network of business, reinvests all profits of those businesses in capital improvements to make more money in the future, pulls out only enough in salary to meet their expenses, makes an equivalent donation to charity to offset all their "inc…

Can you explain the charity portion, isn’t that the net same as not having the money? Sincere question

Re: High taxes be damned, the rich keep moving to California

#16

Post by esf »

CoolGuySteve wrote: post #14
esf wrote: post #10

Earlier quoted context omitted.

Am half of a high earning couple in a bit above this range in California. Surprisingly, my taxes changed very little this year. In years prior, I always had to pay AMT, in which SALT deductions were already disallowed. The new tax law is basically a wash. I don't pay AMT, just pay higher regular. I didn't check exactly but my effective rate this year may even have gone down a little. Many people in this income range…

I’ve been doing the same math for NYC since I work remotely. The thing is, I can still move to another state and not pay state taxes or AMT. I like NYC but I’m not sure I still like it tens of thousands of dollars much after this latest tax reform.

Sure, but the status quo in California didn't really change with the new tax law for this income group, contra the comment. If the taxes didn't deter you before, they aren't different now.

Re: High taxes be damned, the rich keep moving to California

#17

Post by justAnotherNET »

mav3rick wrote: post #12
jlrubin wrote: post #8

Earlier quoted context omitted.

(In case you're wondering -- you're likely being downvoted for calling the parent 'Broseph' -- it's a bit of a pejorative, which is uncalled for in HN's mostly civil discourse)

I thought it was funny. Why do people get upset so easily.

Lifelong exposure to petrochemical derived endocrine disruptors causing low-T, on a societal scale.

Re: High taxes be damned, the rich keep moving to California

#18

Post by ronyeh »

syspec wrote: post #15
nostrademons wrote: post #13

Earlier quoted context omitted.

Wealthy != high income. A high-earning couple might make $500K spread across 2 W-2 salaries, and then pay those $45K in state and ~$200K in federal taxes. A wealthy couple owns a network of business, reinvests all profits of those businesses in capital improvements to make more money in the future, pulls out only enough in salary to meet their expenses, makes an equivalent donation to charity to offset all their "inc…

Can you explain the charity portion, isn’t that the net same as not having the money? Sincere question

Maybe if the charity is called "$YOUR_FAMILY_NAME Foundation" then you can save on taxes and still get to do things you enjoy, like flying your private jet to fight malaria or travel to your country club to play some golf (for charity).

Re: High taxes be damned, the rich keep moving to California

#19

Post by tehlike »

fromthestart wrote: post #6
mario0b1 wrote: post #4

>highest-in-the-nation 13.3% income tax rate That sounds very comfortable and affordable

That's state tax, which is paid in addition to federal (nationwide) tax. Some states, like Texas, have no state income tax.

And no more salt deduction. Almost.

Re: High taxes be damned, the rich keep moving to California

#20

Post by jlrubin »

mav3rick wrote: post #12
jlrubin wrote: post #8

Earlier quoted context omitted.

(In case you're wondering -- you're likely being downvoted for calling the parent 'Broseph' -- it's a bit of a pejorative, which is uncalled for in HN's mostly civil discourse)

I thought it was funny. Why do people get upset so easily.

Don't shoot the messenger!
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