Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The public has a right to know how companies that pay no taxes pull it off

larrysummers.com

Post reply on HN
Print view View original

41–50 of 423 posts

Re: The public has a right to know how companies that pay no taxes pull it off

#41

Post by MattGaiser »

ALittleLight wrote: post #26

I read about tax avoidance schemes like corporate inversions or sending all your patents to a company in some tax free haven and licensing your patents from your company for all your profits, and so on, and it makes me really mad. Companies making many billions of dollars paying no taxes. My intuition is that if I personally came up with a cute "gotcha" like this where I wound up paying zero in taxes because of some…

The IRS tries and loses.

https://www.propublica.org/article/ultrawealthy-taxes-irs-in...

Re: The public has a right to know how companies that pay no taxes pull it off

#42

Post by vkou »

gscott wrote: post #7
dmacedo wrote: post #3

I wonder how feasible it is for individuals (or groups of individuals?) in the US, to also incorporate themselves and, through the same or similar loopholes, also pay no tax... How would the IRS respond in those instances. Has that been tried? Is anyone aware of anything like that? Is the cost of such a scheme prohibitive for an individual vs. a large Corp? I'd be curious what the challenges and outcome of such an ex…

People have tried and the problem is when you want to bring the money back to use it on something. Say you setup a licensing company on an island nation that use to then charge yourself $10,000 a month to license the software you wrote... that you transferred there. Now lets say you want to buy a house and you bring back a certain amount of money. That money is taxable and that is where people mess up they don't repo…

There is no problem if you just don't bring the money back until congress declares a tax holiday. (Yet when another country, like, say, Greece declares a tax holiday, while running a large deficit, our financial press mocks it as populism and corruption...)

Re: The public has a right to know how companies that pay no taxes pull it off

#43

Post by Zarath »

ALittleLight wrote: post #26

I read about tax avoidance schemes like corporate inversions or sending all your patents to a company in some tax free haven and licensing your patents from your company for all your profits, and so on, and it makes me really mad. Companies making many billions of dollars paying no taxes. My intuition is that if I personally came up with a cute "gotcha" like this where I wound up paying zero in taxes because of some…

If you are upper middle class it is possible to pay zero taxes. Between tax loss harvesting, 401ks, opportunity zones, and LLC formation, a citizen can legally pay no taxes some years. It's a bit of a learning curve but none of the mechanics are particularly difficult.

Re: The public has a right to know how companies that pay no taxes pull it off

#44

Post by ghskskdbbdmdldk »

I just want healthcare. We pay more than enough taxes to get healthcare. Why do I not get healthcare for the taxes I pay? The government is busy trying to use my wealth to mine asteroids or shoot brown people or some stupid shit. I appear to get approximately zero benefit from the taxes I pay. Unlike, apparently, many americans, I am far more worried about blood pressure than I am about aggressive brown people and our failure to colonize mars.

Re: The public has a right to know how companies that pay no taxes pull it off

#46

Post by fierarul »

This will not end until people will all "incorporate" and apply the same tax tricks as major corporations. In other words we need the revolution of the "personal corporation". The startup that offers this will be the next Apple. Or, will be shut down when the law is changed. Either way, it's a win for society.

Stripe Atlas is a step in the right direction, but it does only the low hanging fruit. Accounting, handling audits and winding down is where the pros are required.

Re: The public has a right to know how companies that pay no taxes pull it off

#47

Post by closeparen »

ALittleLight wrote: post #26

I read about tax avoidance schemes like corporate inversions or sending all your patents to a company in some tax free haven and licensing your patents from your company for all your profits, and so on, and it makes me really mad. Companies making many billions of dollars paying no taxes. My intuition is that if I personally came up with a cute "gotcha" like this where I wound up paying zero in taxes because of some…

If it's a real loophole, the government is out of luck; best it can do is remove it next year.

When the money flowing through a corporation actually makes someone rich, it becomes his personal income. It's not clear that corporations paying their own taxes is even a good idea vs. collecting the same revenue through higher marginal tax rates on the beneficial owners.

Re: The public has a right to know how companies that pay no taxes pull it off

#48

Post by pcurve »

juskrey wrote: post #45

Why no one ever mentions how much companies effectively contribute to various salary and employees income taxes? Corporate tax is practically nothing.

Companies that pay billions in taxes also contribute. Why let a handful get away with it?

Re: The public has a right to know how companies that pay no taxes pull it off

#49

Post by arielm »

juskrey wrote: post #45

Why no one ever mentions how much companies effectively contribute to various salary and employees income taxes? Corporate tax is practically nothing.

Solid point, though those on here that don’t run businesses probably don’t get the scope of what companies pay that those big ones aren’t able to avoid.

Re: The public has a right to know how companies that pay no taxes pull it off

#50

Post by gnicholas »

akira2501 wrote: post #40
ALittleLight wrote: post #26

I read about tax avoidance schemes like corporate inversions or sending all your patents to a company in some tax free haven and licensing your patents from your company for all your profits, and so on, and it makes me really mad. Companies making many billions of dollars paying no taxes. My intuition is that if I personally came up with a cute "gotcha" like this where I wound up paying zero in taxes because of some…

> Companies making many billions of dollars paying no taxes. I feel like if that's the case, then you shouldn't expect the US Government to participate in the enforcement of your patent. You licensed in some tax haven? Then adjudicate it in that same tax haven, we want no part of your disputes over it.

There are actually some traps for the unwary at the intersection of tax optimization and patent enforcement. For example, if you aren't careful in how you offshore your patents and file your patent lawsuits, you can be ineligible for 'lost profits' as a measure of damages.

This is hugely impactful because the 'lost profits' method can generate much greater payouts than the 'reasonable royalty' method.

This isn't motivated by the sentiment you express, but it nonetheless illustrates that companies that are aggressive on taxes can end up getting bitten in other arenas.

Post reply on HN