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Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

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Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#301

Post by owisd »

alberth wrote: post #173
okintheory wrote: post #132

Earlier quoted context omitted.

This is my current understanding: Basically, once you're this rich, you can take hundreds of millions or billions of dollars worth of loans to cover anything you'd like to spend. Now, you can make sure that you're actually "losing" money in any given year by having (almost) no realized income. Then, at the end, you die, having never paid taxes. https://www.nytimes.com/2021/06/09/briefing/tax-jeff-bezos-w... https://w…

> "Yes, this is a big part of why there's now a common argument that unrealized (but very large) capital gains should be taxed." So how will the person pay for those taxes WITHOUT selling the underlining asset. This is a huge problem in startup land with something called AMT. Where you "on paper" are a millionaire but have no ability to sell your paper shares since the company hasn't IPO yet. I'd hate to live in a wo…

Do they need to sell to pay their taxes? Government could just accept the shares as payment in kind, plenty of uses for them without selling: sovereign wealth fund, state pension fund, employee owned trust.

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#302

Post by bpt3 »

ALittleLight wrote: post #154
okintheory wrote: post #132

Earlier quoted context omitted.

This is my current understanding: Basically, once you're this rich, you can take hundreds of millions or billions of dollars worth of loans to cover anything you'd like to spend. Now, you can make sure that you're actually "losing" money in any given year by having (almost) no realized income. Then, at the end, you die, having never paid taxes. https://www.nytimes.com/2021/06/09/briefing/tax-jeff-bezos-w... https://w…

But you have to repay those loans eventually incurring the tax burden when you do, right?

For Bezos (and the wealthy in general), the interest rate on the loan is lower than your capital gains, so you can just keep rolling the loan forward forever.

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#303

Post by djrogers »

robotresearcher wrote: post #174
ALittleLight wrote: post #154

Earlier quoted context omitted.

But you have to repay those loans eventually incurring the tax burden when you do, right?

You die without ever selling your stocks. Your heirs can pay off your loans by selling some of the stocks they inherit. Their cost basis for those stocks is their value at the time of inheritance. This way no capital gains tax is ever due on the stock gains made in your lifetime.

At the amounts you're talking about (100s of millions of $$), virtually all of that stock would be subject to the federal estate tax, with the vast majority of it at the 40% top rate.

Those unrealized gains you're talking about are one of the main reasons the estate tax was enacted ~100yrs ago...

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#304

Post by dantheman »

Hokusai wrote: post #92
havetocharge wrote: post #82

Earlier quoted context omitted.

His employees are free to seek a better paid employment if a jerk they work for underpays them. What's up with this nonstop handout mindset lately?

> His employees are free to seek a better paid employment if a jerk they work for underpays them. So, people have options to stop being poor, people have options to not have to pee in a bottle at work, but they chose to do it, why? Poverty removes many options, lack of good education removes many options, abusive corporations keep options far away. The system is the problem, people is just living in a system manipula…

It is a handout. It's a handout you agree with, but it's a handout.

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#305

Post by monocasa »

missedthecue wrote: post #296
monocasa wrote: post #287

Earlier quoted context omitted.

Except it doesn't get per se, loans are taken out and paid back on a schedule smaller than the appreciation of the stocks which were used as collateral. That's what that $1B was, and is relative scales we're talking about.

How do you pay back loans without income?

Your capital you used for collateral on the loans accrues value quicker than the loan's payments.

Hence that 1% effective rate.

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#307

Post by djrogers »

abrodersen wrote: post #198
ironrabbit wrote: post #156

Earlier quoted context omitted.

Interesting, but how do you pay off these loans except by later selling stock (and paying capital gains tax)?

When you die, your heirs get the stock with "step up basis", meaning the cost basis used to calculate capital gains resets to the market price at time of death. So if they sell right after you die, they pay no capital gains tax.

The heirs get the stock at etc step-up basis after estate taxes, which are considerable in the $100m+ realm...

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#308

Post by mhh__ »

BingoAhoy wrote: post #151
prepend wrote: post #127

Earlier quoted context omitted.

> pay his employees more Doesn’t Amazon pay highest in its industry? I suppose people always want more, but it seems like they are already among the best. Of course pay varies by location and what’s good in one state is good in another. But it seems the average warehouse worker pay is $12.61 [0] with states ranging from $9.66 for North Carolina (holy cow) to $14.84 in Washington [1]. Amazon pays $16/hour [2] so that’…

Not an odd complaint considering he's worth 207 billion. He could more fairly divide that stock wealth among Amazonians. Question is: that 207 billion, did he accumulate that fairly himself or did his workforce accumulate that for him? Hard to answer from the outside but could a single man accumulate 207 billion without help as a corporation of one.

You don't make a company out of a bunch of workers in a field though, do you? People underestimate what good leadership it worth - sometimes even people who I later see worshipping Lisa Su (She's not a chip architect, she lets the chip architects fly - Bada bing Bada boom AMD is up however many gazillion percent).

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#309

Post by riantogo »

Zelphyr wrote: post #9

All the critics lobbing cynicism against Bezos, Branson, and Musk saying, in essence, that their money is better spent here at home reminds me of a wonderful scene from The West Wing when one character asks why we have to go to Mars: "'Cause it's next. For we came out of the cave, and we looked over the hill, and we saw fire. And we crossed the ocean, and we pioneered the West, and we took to the sky. The history of…

That is the romanticized version. The history of man is exploration, expansion and exploitation. Destroying everything nice in its path. We destroyed other species, our own species if they looked different, and finally we have all but destroyed the planet. Rather than staying on that path maybe a better approach for humanity is compassion, kindness and helping each other out.

Having said that, I'm totally okay with billionaires spending money on such activities as it puts money back in the economy. The more the better.

Re: Bezos donates $100M each to CNN contributor Van Jones and chef Jose Andres

#310

Post by djrogers »

gonehome wrote: post #190
nomel wrote: post #159

Earlier quoted context omitted.

Borrowing mean returning the money at some point. Where does this money come from, and how isn't it taxed?

Person dies, wealth gets inherited at new cost basis, heirs pay off loans with new (higher) cost basis, tax revenue isn’t collected. At least that’s the model as I understand it.

> tax revenue isn’t collected.

If you completely ignore estate taxes, this would be true.

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