How to have a billion dollar exit with zero capital gains tax • Hacker News Board

Re: How to have a billion dollar exit with zero capital gains tax

#271

Post by systemvoltage » Tue, May 10, 2022, 6:35 PM UTC

ABCLAW wrote: post #147

systemvoltage wrote: post #100

Earlier quoted context omitted.

Have been. For years. I see dwindling QoL, infrastructure on stilts, power outages, anti-small-business bureacracy, woke government initiatives and dysfunctional law enforcement where I live. I give my local and state government a solid 2/10 score. I am a socialist where governments are efficient, liberatarian where governments are dysfunctional.

>I am a socialist where governments are efficient, liberatarian where governments are dysfunctional. At first glance this position seems reasonable, but ultimately it's short sighted - the game is iterative. Penalizing the public coffer ultimately results in higher costs over the long run as high ROI investments are left on the planning table. The attitude itself is a large part of why the American government is para…

This is a straw man. I’m speaking up for disproportional attention given to not holding the government accountable.

There should be more focus on why government is dysfunctional than about raising taxes. The situation is completely opposite today, extremely lopsided. Newspapers and journalism has stopped exposing government scandals and inefficiencies, but people are frothing over other things.

I want governments to work like Swiss agencies.

Re: How to have a billion dollar exit with zero capital gains tax

#272

Post by HWR_14 » Tue, May 10, 2022, 6:37 PM UTC

lukas099 wrote: post #178

jen729w wrote: post #70

Earlier quoted context omitted.

I was going to say that this article should be titled “how to steal from society”, so I’ll join you in downvote-city, comrade.

Reducing your taxable income is stealing? So if I contribute to a Roth IRA, I am stealing too?

I'd say if you did what Theil did and use your Roth to purchase your own startup, yes. If you use it to play the market or invest in index funds, no.

Re: How to have a billion dollar exit with zero capital gains tax

#273

Post by candiodari » Tue, May 10, 2022, 7:35 PM UTC

ajsnigrutin wrote: post #161

dmje wrote: post #68

Unfashionable thought: pay your damn taxes. Loopholes are one thing and IMO should be closed but morality is another. The whole idea that you can make a billion dollar business without being hugely dependent on the infrastructure, education, history, societal background etc that has largely been paid for by...taxes...is utter fallacy. Maybe if massively profitable businesses spent a bit more time doing the right thin…

I live in a former socialist country, and I hate the "we will tax the rich" (as in higher tax percentages) paroles I hear from our current left-leaning (even communist) parties here. Why? (and I have mentioned this before, many times, even here) Poor people already pay almost zero taxes. Rich people avoid paying taxes at all. And me, someone with an above average but below "rich" (engineers) paycheck get fucked by th…

Why? If you calculate it out taxing the rich can't help you. Even if it worked, it wouldn't provide a meaningful increase in government income. The "middle class" are the only ones that can be taxed to actually achieve sponsoring the government.

So while I understand the arguments for fairness, it cannot meaningfully affect my situation, and therefore it's a bit like an "there shouldn't be any homeless" type situation. Ideally, yes, I'd want the rich to pay. Practically, it's rather low on the priority list.

Re: How to have a billion dollar exit with zero capital gains tax

#274

Post by epistasis » Tue, May 10, 2022, 8:01 PM UTC

doovd wrote: post #82

diob wrote: post #77

Earlier quoted context omitted.

Capitalism these days feels akin to joining a game of monopoly where everything has already been purchased. But feel free to have a jolly time going around the board and paying rent :)

Well, monopoly was introduced as satire in the first place in fact! A way to showcase some absurdities of capitalism

Not exactly a critique of capitalism, but of private land ownership. The Landlord Game was created by a Georgist, and Georgists consider land and capital to be entirely different economic factors with entirely different behaviors. Marxists often consider Georgism to be capitalism's last gasp.

Re: How to have a billion dollar exit with zero capital gains tax

#275

Post by randito » Tue, May 10, 2022, 8:02 PM UTC

tnr23 wrote: post #75

ggm wrote: post #72

Earlier quoted context omitted.

This is HN. we welcome diversity of views. this view you espouse, is not actually a minority view, but still, its a divisive topic. I'm a high tax kinda guy. If we all had Norway taxes, we'd have Norway sovereign fund and EV and lifestyle (but maybe without SAD, because we're not all that far north)

Norway oil is way more relevant for your thesis than Norway taxes

Norway oil [with a visionary who helped guide its investment] is more relevant.. https://news.ycombinator.com/item?id=19594153

Re: How to have a billion dollar exit with zero capital gains tax

#276

Post by rdl » Tue, May 10, 2022, 8:43 PM UTC

HWR_14 wrote: post #270

rdl wrote: post #93

Earlier quoted context omitted.

Infrastructure sucks relatively to almost everywhere else in the US (better than other territories, probably better than parts of Alaska). Legal system is really bad (bad hybrid of old Spanish law, 1950s American law, and nearly a century of corruption). High costs (inherent to being on an island) combined with regulatory/etc. burden raising costs. It makes sense for completely vertically integrated businesses which…

Pharma is no longer a great choice for PR. Several of the various federal advantages to locating there have expired

It still is relatively better to do pharma in PR than many other industries in PR, since it has an established workforce and a bunch of facilities, and there are PR-specific tax breaks under IRC 933 (just no longer 936). There's established pharma, and sometimes line extensions; not sure if anyone would put a new pharma startup here.

Microsoft lost their tax case so they're GTFO after >10 years, though; that probably also discourages similar IP-embodied manufacturing in pharma.

Re: How to have a billion dollar exit with zero capital gains tax

#277

Post by truckerbill » Tue, May 10, 2022, 9:21 PM UTC

imgabe wrote: post #146

truckerbill wrote: post #141

Earlier quoted context omitted.

The utility of money decreases the more you have (outside of lifestyle inflation). When basic needs of society (like housing) aren't being met, there shouldn't be a cap on what the wealthy pay imo.

The "money" the very wealthy have is not cash sitting in a checking account but usually shares in some corporation. That absolutely has utility if you want to continue having a say in how your company is run. Besides, should the government come around and check for any property that it deems you're not sufficiently utilizing and confiscate it from you? It seems like that policy could be abused. The government already…

The wealthy and the government are generally rather intertwined wouldn't you agree? It's not a matter of budget but of sharing a scarce resource, something the wealthy and powerful, (and so by extension the government) are historically not so inclined to do. Taxation is a means of systematising the sharing of resources.

Re: How to have a billion dollar exit with zero capital gains tax

#278

Post by IanCal » Tue, May 10, 2022, 10:24 PM UTC

chii wrote: post #239

IanCal wrote: post #149

Earlier quoted context omitted.

> This isn't a loophole as much as a completely designed tax break. I strongly doubt that the outcome here is the intent of the tax break, which seems to be "pump money into poor areas and we'll let you off the CGT on the amount you invested in the area". She "re-invests" a thousand dollars by starting a company that is just a few people in some co-working spaces, and walks away a few years later with hundreds of mil…

The business is hypothetical in the article, but the hypothetical is a software business, and is making money. So they didn't "just place people in some co-working spaces", they did work as employees and got paid, which brings in economic activity to a depressed region. Seems to be exactly what the tax break is intending. This is much better a tax break than a city bidding for an amazon HQ with a custom tax break dea…

> So they didn't "just place people in some co-working spaces"

It's quite literally what the article explains.

> they did work as employees and got paid, which brings in economic activity to a depressed region.

The regions are tiny, walkable across in the article. They're not bringing in workers to live, build a family and spend within a large metro area - they're "a space nearby a university". The economic activity brought in is a small number of employees buying some coffee, maybe lunch and then going home.

> Seems to be exactly what the tax break is intending.

You think that spend in co-working spaces is what the government wants to give up hundreds of millions of dollars for?

Re: How to have a billion dollar exit with zero capital gains tax

#279

Post by epistasis » Tue, May 10, 2022, 10:50 PM UTC

seibelj wrote: post #91

diob wrote: post #77

Earlier quoted context omitted.

Capitalism these days feels akin to joining a game of monopoly where everything has already been purchased. But feel free to have a jolly time going around the board and paying rent :)

At least in capitalism you can start a new business. The folly of the Monopoly board game is the limited spaces which makes things a zero-sum game. The world is only zero-sum when the government doesn’t let you build new stuff through artificial constraints. In a free market always get new stuff.

Even without height restrictions, limited ownership of land still has the problems exhibited in the game.

Zoning and highly restrictive building codes were invented after Georgism, and are ways to further heighten the basic unfairness of land.

Local politics are dominated by landowners, as they tend to have the most control of, and greatest interest in controlling, the local levers of power.

It is ironically why I'm less concerned about private equity buying houses to rent than I am of local small time landlords buying houses. PE firms won't control local politicians in the same way that local landlords control politicians, because it's too much work and requires ridiculously intimidate knowledge of the local patronage networks.

Re: How to have a billion dollar exit with zero capital gains tax

#280

Post by epistasis » Tue, May 10, 2022, 10:52 PM UTC

ben-schaaf wrote: post #130

seibelj wrote: post #91

Earlier quoted context omitted.

At least in capitalism you can start a new business. The folly of the Monopoly board game is the limited spaces which makes things a zero-sum game. The world is only zero-sum when the government doesn’t let you build new stuff through artificial constraints. In a free market always get new stuff.

I can't think of a single thing that isn't inherently limited. Maybe the sun is practically infinite, though you're certainly limited by the amount of power you can capture. Land, natural resources, time, it all has limits.

The quantity of steel may be inherently limited, but we can still make more than what we have now.

Land behaves differently because of the extremely in elastic supply. And it's not very fungible; a lot in the middle of Nevavda hundreds of miles from the nearest freeway is not exchangeable with the same size lot in Palo Alto.

And the limit itself is the amount of iron ore; that would be considered economic land, but the steel may just be considered capital.