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We are publishing the tax secrets of the .001%

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

#261

Post by swiley »

cletus wrote: post #236
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.

> The worse tax situation is always the person who makes 500k in a good year What's the problem here? Income tax rates are moderately progressive. They'll pay a higher marginal tax rate and a moderately higher total tax rate in this year. That seems fine to me. > or sells a house they held for 25 years which went up a bunch in value This is what I have a problem with. This house has already had plenty of favourable t…

Something people forget is the high amount of churn among millionaires in the US. It's the billionaires you're trying to go after, 500k should be ignored.

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

#262

Post by ianbicking »

BarkMore wrote: post #171
breakfastduck wrote: post #149

Earlier quoted context omitted.

Because this would absolutely shaft everyone other than the well off? Because there would be no way at all of scaling the tax based on income / wealth? So someone earning almost nothing with no wealth would be expected to pay the same tax as a billionaire?

See the Fair Tax proposal for one way to address this problem. https://en.wikipedia.org/wiki/FairTax

A large UBI would address this OK, but FairTax seems to really work to keep the tax as regressive as possible without being quite so bad as a flat VAT. A "welfare payment" for "low-income earners" means you have to be in the system ("earner"), that income still has to be calculated, and that the payment is stigmatized ("welfare") instead of presented as an entitlement.

This also seems bad: "The proposed Fair Tax Act would apply a tax, once, at the point of purchase on all new goods and services for personal consumption" - "personal consumption" is arbitrary. A VAT tax applied everywhere for all goods would be fair and harder to avoid. Though even that seems like it would encourage financialization to hide material production.

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

#263

Post by cletus »

xienze wrote: post #256
cletus wrote: post #236

Earlier quoted context omitted.

> The worse tax situation is always the person who makes 500k in a good year What's the problem here? Income tax rates are moderately progressive. They'll pay a higher marginal tax rate and a moderately higher total tax rate in this year. That seems fine to me. > or sells a house they held for 25 years which went up a bunch in value This is what I have a problem with. This house has already had plenty of favourable t…

> Gains on that property deferred for up to 25 years. Well yeah, before that point it hasn’t been sold, so paying taxes on unrealized gains on what the house “should” be worth is bullshit.

I agree, but my point is that this is a favourable tax treatment (which it is) because it doesn't have to be that way.

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

#264

Post by dang »

iso1631 wrote: post #202
Mc_Big_G wrote: post #178

Earlier quoted context omitted.

GFY

> Most of your gains are going to go to taxes, so you wait to sell or only sell a little So basically you're hoping for someone to get elected who will give you a ton of money (via a tax cut for the wealthy)

"Please respond to the strongest plausible interpretation of what someone says, not a weaker one that's easier to criticize. Assume good faith."

"Have curious conversation; don't cross-examine."

https://news.ycombinator.com/newsguidelines.html

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

#265

Post by rllearneratwork »

cycomanic wrote: post #231
microdrum wrote: post #191

Earlier quoted context omitted.

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 opt…

That you consider yourself upper middle class with an income of 1M a year already says a lot about how skewed your view is (not surprising there was some article on HN recently about research showing that the rich and the poor consider themselves middle class both). Sure you are not a billionaire but you are not middle class anymore, you earn 30 times the median income in the US. Now comparing yourself with the super…

have you heard about different cost of living in different places? What if the person plans to fund himself/herself in the retirement and pay for kids college rather than expecting all that "for free" from the government?

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

#266

Post by dang »

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

Please don't delete-edit your posts like that. It's not fair to the users who replied.

And needless to say, attacking other users like that will get your account banned here. We've had to warn you multiple times in the past about breaking the HN guidelines. I don't want to ban you, so if you'd please review https://news.ycombinator.com/newsguidelines.html and fix this, we'd be grateful.

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

#267

Post by jvanderbot »

LargeWu wrote: post #198
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.

Right. But the article (and I think the general consensus around the movement) states that the net worth (wealth) is a missed tax opportunity, regardless of whether it is liquidated. Is that correct?

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

#268

Post by nostrademons »

cletus wrote: post #236
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.

> The worse tax situation is always the person who makes 500k in a good year What's the problem here? Income tax rates are moderately progressive. They'll pay a higher marginal tax rate and a moderately higher total tax rate in this year. That seems fine to me. > or sells a house they held for 25 years which went up a bunch in value This is what I have a problem with. This house has already had plenty of favourable t…

The issue, if I'm understanding the OP right, is that income taxes are moderately progressive until you get to the levels where people make their living off wealth, not income. Someone earning a wage is going to pay a monotonically increasing percentage of their income as they move up the scale. That's fine. Someone who owns a holding company that itself owns 80% interests in a variety of LLCs that reinvest their profits to increase their paper valuation, and then takes out loans against the value of their holdings to pay for living expenses - could quite easily end up paying zero tax. Warren Buffett once posted that he pays half the tax rate that his secretary does (17% vs. 34% [1]), and Buffett doesn't even partake of some of the tax avoidance strategies (like taking out loans against his holdings instead of selling them outright) that many other wealthy do.

[1] https://www.forbes.com/sites/paulroderickgregory/2012/01/25/...)

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

#269

Post by Nbox9 »

MR4D wrote: post #230
fairity wrote: post #142

Earlier quoted context omitted.

Why isn't there an option to take out a loan where a repayment option is to transfer the capital asset (at whatever the value happens to be at the time of repayment)? I.e. I don't get why the risky part of this loan can't be mitigated by the bank taking on the risk and managing it separately. Surely, there would be investors willing to back these types of collateralized loans?

> ... bank taking on the risk... Banks don't take on risk. Seriously. That's another conversation to have, but the simple answer is do you want the value of your checking account impacted by someone else's purchase of Gamestop, or Enron? And that's why banks don't take risk.

Banks loan money, and every loan includes some risk. If banks didn’t take on risk than the 2007/2008 bailouts wouldn’t have happened.
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