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We are publishing the tax secrets of the .001%

propublica.org

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Re: We are publishing the tax secrets of the .001%

#191

Post by microdrum »

whiddershins wrote: post #92

Every time someone tries to make a tax targeting the ultra rich, it ends up hurting the moderately wealthy instead. Every. Single. Time. The worse tax situation is always the person who makes 500k in a good year, or sells a house they held for 25 years which went up a bunch in value. I suspect this is a significant factor in social mobility. Our tax system is punitive to people who try to leave the working class.

I agree.

As someone from a poor family, never received inheritance of any kind, and now (40 years old) makes +/- $1M per year, I climbed through every 'tax bracket'. The income tax system is absolutely designed to make it very hard to move through working class into middle class, and then from middle class to upper middle class.

Once you have escape velocity, you've got room to move with debt facilities and other options. Everyone wants to give you free, high quality banking services. It gets easier. But moving from, say $70K to $500K is very very hard specifically because of taxes.

For a very long time, the cumulative sum of taxes I'd paid were more than the money I actually had in my account, to invest and pay for things.

Ted Cruz was right, taxes should fit on a postcard for everyone.

And no, unrealized investments shouldn't be taxed and no one except do-nothing journalists are surprised to learn that they aren't - this ProPublica article is really the definition of fake news.

Actually let me just say what it is: propaganda leaked in order to build support for the president's tax increases, which are a very bad idea.

Re: We are publishing the tax secrets of the .001%

#192

Post by LargeWu »

silicon2401 wrote: post #82
pmoriarty wrote: post #75

Earlier quoted context omitted.

Many of the ultra-wealthy have little or no income. What needs to be taxed is wealth, not income.

I disagree, at least not with so simple an implementation. I don't want to live in a world where we're unable to escape working by constant taxes. There should be at least a minimum threshold where wealth is completely untaxed so that people can live freely and not have to work until they die. Enough for a house, some property and land, and a retirement fund. I'd consider it more justifiable to tax someone like Bill…

Most of the wealth tax proposals I've seen don't even kick in until you have tens or hundreds of millions of dollars. I don't think anybody needs to be worried about those people having to work until they die.

Re: We are publishing the tax secrets of the .001%

#193

Post by cj »

dakial1 wrote: post #170
cj wrote: post #130

Earlier quoted context omitted.

1) You purchased $100 of SPY on June 15th, 2020 2) You're buying a house, and you need $100 today. 3) You sell $100 of SPY, and pay short-term capital gains (up to 37%) OR... 1) You purchased $100 of SPY on June 15th, 2020 2) You're buying a house, and you need $100 today. 3) You take a loan for $100 4) You wait until June 15th, 2021 and then sell $100 of your SPY holdings, paying long-term capital gains (15-20%) 5)…

But if the asset sale + the debt leaves you at a loss wouldn't you be able to avoid paying the capital gaibs over the asset sale?

The theoretical assumes SPY increased over the time period. If it decreased, you could of course sell it and pay 0% since your investment lost money, short/long-term gains wouldn’t matter because there wouldn’t be any gains.

I might be misunderstanding your question though.

Re: We are publishing the tax secrets of the .001%

#194

Post by jedberg »

fairity wrote: post #182
jedberg wrote: post #155

Earlier quoted context omitted.

You'd need a crazy high interest rate to account for market volatility. If the bank could make accurate predictions as to the future value of the stock, they would just invest in the stocks. Loans against other assets are much less risky, because they are backed by actual things. If the bank screws up in predicting the future value of a house, they can still own the actual house and land if you default. With stocks i…

Hm, is it possible to define a range for "crazy high interest"? As the debtor, I'd be willing to pay up to the difference in long-term and short-term capital gains (~15%). I guess where I'm going with this is: I don't understand why the average person ever pays short-term capital gains tax.

> I don't understand why the average person ever pays short-term capital gains tax.

Because the risk of holding the stock is more than the difference in short vs long term capital gains.

If the stock is worth $1000 in gains, I know I can sell it and lock in the gains today and pay my normal income rate. If I have to hold it for another 6 months, there is a huge risk that it drops more than the 5-10% difference in the tax rate for the average person.

Re: We are publishing the tax secrets of the .001%

#196

Post by kbelder »

Wowfunhappy wrote: post #172
realce wrote: post #159

Earlier quoted context omitted.

If you have just enough assets to be "rich" but don't have enough to purchase tax assistance, you've become unprotected prey. Everyone that can afford this tax assistance has a lower cost of business than you, everyone poorer has a lower tax burden.

I'd love to see some data on how big a deal this really is, because I would normally assume that by the time you've reached the levels of wealth we're talking about, "tax assistance" is a trivial expense.

I think at this level, tax protection isn't 'hiring a decent accountant' or 'donate $10,000 to charity', but instead is 'moving your base of operations off-shore' and things like that. Things you can do with a ten-million dollar income, but not a half-million.

Re: We are publishing the tax secrets of the .001%

#197

Post by u801e »

Mc_Big_G wrote: post #178
Wowfunhappy wrote: post #134

Earlier quoted context omitted.

> Every time someone tries to make a tax targeting the ultra rich, it ends up hurting the moderately wealthy instead. Every. Single. Time. Could you please share some of the situations you're thinking about here? I'm not familiar.

GFY

> Your dollars saved are worth much less than they were a few years ago and now your taxes are high

Which makes me wonder why the general consensus about deflation is that it's not a good thing.

Re: We are publishing the tax secrets of the .001%

#198

Post by LargeWu »

jvanderbot wrote: post #86

What I don't understand is: If I (a wage slave) find a football sized diamond in my back yard, I'm suddenly very "wealthy". Should I be forced to pay taxes on that find because my wealth has increased? What if I want to keep that diamond but cannot afford to because of the taxes? Isn't that how business owners gain wealth: By the valuation defined by others to the thing they "found". Should we force Bezos et al to se…

When you own stocks, you don't pay taxes every time the value of your portfolio changes. You only pay capital gains when you sell those stocks.

Your example isn't really that much different. You would only really need to pay taxes on that diamond when you sell it, in which case you would just use the proceeds of the sale to cover that.

Re: We are publishing the tax secrets of the .001%

#199

Post by chrisseaton »

dangus wrote: post #156
dhd415 wrote: post #132

Earlier quoted context omitted.

>>A household that makes $500k on a good year is actually in the 1% statistically. They have left the working class long ago. They could work for about 7-10 years in their career and retire with an above-median salary (withdrawing following the 4% rule) in perpetuity. That is by definition not the working class: that family barely has to work in order to secure a lifetime of comfortable living. The "in a good year" q…

Of course it does. The working class doesn’t get stock options, vesting cliffs, inheritance, or capital gains! Or much of a savings account or 401k, for that matter. The option to stop working for more than a few weeks or months takes you squarely out of the working class. Basically, what I’m trying to say is that the parent comment to ours is attempting to advocate for taxing just the billionaires and not to tax the…

Plenty of normal working class people get options if they work at a tech company.

Re: We are publishing the tax secrets of the .001%

#200

Post by mola »

syshum wrote: post #162
gota wrote: post #54

Earlier quoted context omitted.

I disagree almost completely. I understand your concerns - but they are based on weighing personal freedom above all else, and I just don't. I think there's a tradeoff there and it is favorable in favor of disclosing tax information. To your points: > gold-diggers I'm not sure if this is an idiomatic term and out of my grasp, but if you mean that people will get romantically involved with others because of their mone…

>>but they are based on weighing personal freedom above all else and this is largely the primary difference between American Culture /Politics and the rest of the world, specifically European nations European nations have always been more collectivist in nature, where the US was founded on Individualism, and Individual Freedom. There are signs that the US is losing this desire, and it saddens me because unlike you I…

Perhaps they are losing this desire because it doesn't provide the well being it promises? Because personal freedom has become a meme abused by ultra rich to disable any effort to fix systemic problems in the US?
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