We are publishing the tax secrets of the .001% • Hacker News Board

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

#531

Post by HWR_14 » Wed, Jun 09, 2021, 4:14 AM UTC

dragonwriter wrote: post #525

HWR_14 wrote: post #522

Earlier quoted context omitted.

It's both a magic number and a threshold. Married filing separately is just 1/2 of married filing jointly, which is how it should be.

> It's both a magic number and a threshold Its a threshold, but not one below which capital gains stops mattering, which was the significance falsesly ascribed to the “magic number". If you had cited the bottom of the 15% bracket instead of the top as the magic number below which cap gains don’t matter, well, “magic” would still be overdramatic but you would at leaast have something of a point. But that’s close to an…

It's also irrelevant as I called out in my post. The question was "how do we tax average people making a windfall of 500k", not "let's talk exclusively long-term capital gains"

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

#532

Post by rtpg » Wed, Jun 09, 2021, 4:59 AM UTC

WalterBright wrote: post #500

rtpg wrote: post #498

Earlier quoted context omitted.

There is such a stupidly easy solution to this, which is to set a lower limit for whatever rule applies. Though... even though things like estate taxes have these rules (either "first million isn't taxed" or "primary residence isn't taxed" etc, depending on jursidiction), most people tend to not actually read the details and assume that the gov't wants to take the family farm. No, I don't think it's your god-given ri…

You don't have the god-given right to take it, either :-) Taxes should be extracted as needed to support things that only government can do. Taxes should not be extracted based on envy, or just because they can be.

Taxes are a tool in the toolbox to organizing society for progress as a whole.

I think that making it so that people who have a lot of accumulated wealth are asked to put more into the collective coffers is an extremely obvious and fair-ish way of doing things. Much more so than dumb things like "roads should be paid for by gas taxes" (we don't pay for libraries with book taxes! Or schools with child labor income tax!)

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

#533

Post by andi999 » Wed, Jun 09, 2021, 5:03 AM UTC

ksec wrote: post #517

ALittleLight wrote: post #506

Earlier quoted context omitted.

Assuming the parent comment is referring to earnings in Euros rather than USD they're talking about ~250k USD. It doesn't seem at all strange that leadership in a small company is making the same as entry developers at FAANG. For one, small business. Two, the company leadership gets more equity and a more interesting job.

>in Euros rather than USD they're talking about ~250k USD. Not ~120K USD?

True, but 120k in Finnland give you probably the same quality of living as 250k in the bay area.

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

#534

Post by ineptech » Wed, Jun 09, 2021, 5:29 AM UTC

rascul wrote: post #428

ineptech wrote: post #412

Earlier quoted context omitted.

Because there's a tax shelter for that case - see https://en.wikipedia.org/wiki/Taxpayer_Relief_Act_of_1997

Are you referring to this? > The act permanently exempted from taxation the capital gains on the sale of a personal residence of up to $500,000 for married couples filing jointly and $250,000 for singles. This exemption applies to residences the taxpayer(s) lived in for at least two years over the last five. Taxpayers can only claim the exemption once every two years. As I interpret the text, the middle-class homeown…

You are misinterpreting that part; you can claim the exemption in a house you've lived in for two years. "Two years out of the last five" means you can live in the house for two years, then move out of it (presumably because you bought another house) and rent it for up to three years, and then sell it and still claim the exemption. Even after that, you can sell it and still not pay taxes on it if you use the proceeds to purchase a different investment property (this is the "1031 exchange" that's been mentioned several times).

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

#535

Post by marcell » Wed, Jun 09, 2021, 6:53 AM UTC

fastball wrote: post #491

marcell wrote: post #368

Earlier quoted context omitted.

If you tax loans that means every credit card purchase or mortgage would trigger a tax. If you receive a $400k loan for a mortgage, that would mean something like $100k in taxes for an upper middle earner.

Thresholds + only collateralized loans?

Pawnshops are collateralized loans for the poor.

If the goal is to tax the rich, just be more direct and tax the rich. A wealth tax would work, no need for elaborate schemes.

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

#536

Post by teachingassist » Wed, Jun 09, 2021, 7:37 AM UTC

paul_f wrote: post #476

munificent wrote: post #277

Earlier quoted context omitted.

Every single time someone tries to make a tax targeting the ultra rich, someone writes a comment just like this. Every. Single. Time. As far as I can tell, this comment is semantically identical to: "Every time someone tries a new cancer therapy, it ends up not helping the worst cancers." "The sting operation was a failure because it only caught low- and mid-level criminals." "We shouldn't use automated tests because…

Maybe you should focus on how you would avail the failures of past attempts: https://www.npr.org/sections/money/2019/02/26/698057356/if-a... >In 1990, twelve countries in Europe had a wealth tax. Today, there are only three >France's wealth tax contributed to the exodus of an estimated 42,000 millionaires between 2000 and 2012, among other problems. Only last year, French president Emmanuel Macron killed it.

> In 1990, twelve countries in Europe had a wealth tax. Today, there are only three

The "Today,..." claim is is simply false (both when the article was written, and now).

Wikipedia lists examples including six countries in Europe. Belgium is listed, which created a wealth tax in 2018 - why is that missing from this article of 2019?

Tax regimes in Europe change frequently according to the political situation, so this presents little evidence as to whether any individual tax "worked" anyway. But, this claim is just badly researched (generously speaking).

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

#537

Post by madsbuch » Wed, Jun 09, 2021, 7:59 AM UTC

jeffreyrogers wrote: post #484

madsbuch wrote: post #308

Earlier quoted context omitted.

The kidnapping problem is on a whole other level. Denmark is known for "leaving babies in strollers outside of cafes". The Nordic social-liberal countries (Finland included) solve this problem not by opacity but by having social support and trust.

I know that, but you mostly don't get to choose whether you live in such a country or not. Everyone would choose to live in a country like that if they could.

I think the point is, that the society as a whole should support public tax records. Finland (and Sweden) does.

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

#538

Post by lolive » Wed, Jun 09, 2021, 8:20 AM UTC

TrackerFF wrote: post #514

bwestergard wrote: post #7

In Finland, everyone's taxable income is a matter of public record. One theoretical benefit of such a policy is that it eliminates information asymmetries between workers and employers in wage bargaining.

Same in Norway, but the result isn't very accurate. For one, the wealthy don't tend to have any serious income - it's mostly capital gains for one of their holding companies or similar. Second, those numbers can be seriously "massaged" by having debt - your income will show much lower if you have any significant debt (no mater how low the interest rate is). For normal / regular people, the public figure gives you a v…

I am no expert but how can you reduce your income tax with debt? I thought only companies could include their debts into their global accounting, not individuals.

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

#539

Post by lolive » Wed, Jun 09, 2021, 8:26 AM UTC

a1369209993 wrote: post #418

frockington1 wrote: post #351

Earlier quoted context omitted.

Dumb person here. What is "leaving babies in strollers outside of cafes"?

When going into a cafe to order something, they leave their child (in a stroller) outside with the (allegedly justified) expectation that nothing bad will happen to it. (To be fair, babies aren't especially easy to liquidate if stolen, and strollers are inconveniently bulky, so this arguably says less about the amount of crime than about how petty, blatant, and asinine the criminals are.)

Reminds me of a Michael Moore movie where he goes to Canada, and checks in a neighbourhood whether people lock their main door or not. He litteraly enters a house, and asks directly to the inhabitants: "Why don't you lock your door?". And the canadians answer: "Why should I?"

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

#540

Post by MR4D » Wed, Jun 09, 2021, 11:12 AM UTC

alex_young wrote: post #459

MR4D wrote: post #242

Earlier quoted context omitted.

Short of a 1031 exchange, I'm not sure how you would do that.

You can sell a house every 2 years and write off up to $500k in capital gains as long as it’s been your primary residence for 2 of the last 5 years. Doesn’t need to be consecutive.

Sure, but you have to stomach the 6% commission you’re paying to the brokers, which really limits this situation to transitory market conditions instead of a get rich quick strategy.