If You Support More Taxes, Please Lead by Example

[Emmortal]

The only thing I'm mad about is the educational system.  It's producing illiterate retards like you who can't comprehend the thread or even the thread title for that matter.

Damn, education has gone to shit.

u mad?

[Butterbean]

many sources for that info

here is one

http://www.forbes.com/sites/robertlenzner/2011/07/25/the-400-richest-americans-pay-an-18-tax-rate/

I posted this article earlier this year.

It's worth 5 minute of your time to read in it's entirety

http://wweek.com/portland/article-17350-9_things_the_rich_dont_want_you_to_know_about_taxes.html

I'm not an accountant (or even good w/math!) so I may need clarification/help but:

Both of those articles look to concentrate on the "richest 400" paying a ~16% income tax rate because their income is mainly based on capital gains and dividends (which are taxed at the lower rate), right?

Not all the "rich" fall into this category and not all of them use loopholes etc such as those in Section 4 of your second article.  Plus the hedge managers in Section 4 eventually will pay.

Your second article is somewhat skewed, imo, in the wording of some things, for instance the case that they try to point out that people that pay no income tax still pay taxes but also make statements like "Donald Trump [lives tax free] and paid no taxes for 2 years."

That said, I'm not blind to the fact that some people do use loopholes to pay a lower percentage but some also if they made enough charitable donations (the latter not being a bad thing imo).

[GigantorX]

I'm not an accountant (or even good w/math!) so I may need clarification/help but:

Both of those articles look to concentrate on the "richest 400" paying a ~16% income tax rate because their income is mainly based on capital gains and dividends (which are taxed at the lower rate), right?

Not all the "rich" fall into this category and not all of them use loopholes etc such as those in Section 4 of your second article.  Plus the hedge managers in Section 4 eventually will pay.

Your second article is somewhat skewed, imo, in the wording of some things, for instance the case that they try to point out that people that pay no income tax still pay taxes but also make statements like "Donald Trump [lives tax free] and paid no taxes for 2 years."

That said, I'm not blind to the fact that some people do use loopholes to pay a lower percentage but some also if they made enough charitable donations (the latter not being a bad thing imo).

Good post.

[Straw Man]

I'm not an accountant (or even good w/math!) so I may need clarification/help but:

Both of those articles look to concentrate on the "richest 400" paying a ~16% income tax rate because their income is mainly based on capital gains and dividends (which are taxed at the lower rate), right?

Not all the "rich" fall into this category and not all of them use loopholes etc such as those in Section 4 of your second article.  Plus the hedge managers in Section 4 eventually will pay.

Your second article is somewhat skewed, imo, in the wording of some things, for instance the case that they try to point out that people that pay no income tax still pay taxes but also make statements like "Donald Trump [lives tax free] and paid no taxes for 2 years."

That said, I'm not blind to the fact that some people do use loopholes to pay a lower percentage but some also if they made enough charitable donations (the latter not being a bad thing imo).

sounds like you understand it pretty well.  Keep in mind that most uber rich people (and even people making just a few million dollars a year) don't usually receive that money as W-2 wages.    They usually have corporations, LLC's, etc.. which can be manipulated to filter their income through the least taxed avenue (and since our laws allow this there is nothing wrong or evil about it but it doesn't change the fact that they pay less as a percentage of their income then people making a lot less money)

[Dos Equis]

I'm not an accountant (or even good w/math!) so I may need clarification/help but:

Both of those articles look to concentrate on the "richest 400" paying a ~16% income tax rate because their income is mainly based on capital gains and dividends (which are taxed at the lower rate), right?

Not all the "rich" fall into this category and not all of them use loopholes etc such as those in Section 4 of your second article.  Plus the hedge managers in Section 4 eventually will pay.

Your second article is somewhat skewed, imo, in the wording of some things, for instance the case that they try to point out that people that pay no income tax still pay taxes but also make statements like "Donald Trump [lives tax free] and paid no taxes for 2 years."

That said, I'm not blind to the fact that some people do use loopholes to pay a lower percentage but some also if they made enough charitable donations (the latter not being a bad thing imo).

Nice.  You should post here more often.   

[Primemuscle]

I'm not an accountant (or even good w/math!) so I may need clarification/help but:

Both of those articles look to concentrate on the "richest 400" paying a ~16% income tax rate because their income is mainly based on capital gains and dividends (which are taxed at the lower rate), right?

Not all the "rich" fall into this category and not all of them use loopholes etc such as those in Section 4 of your second article.  Plus the hedge managers in Section 4 eventually will pay.

Your second article is somewhat skewed, imo, in the wording of some things, for instance the case that they try to point out that people that pay no income tax still pay taxes but also make statements like "Donald Trump [lives tax free] and paid no taxes for 2 years."

That said, I'm not blind to the fact that some people do use loopholes to pay a lower percentage but some also if they made enough charitable donations (the latter not being a bad thing imo).

Good for you....commomsense always wins when all is said and done. Many publications on any subject including taxes are skewed. The truth is there are many versions of the truth and they are all arguable and supportable. One's need to be right is powerful. When someone (including me) is trying to make a point they will seek the best example to do this. The best example is rarely a neutral or middle of the road viewpoint.

The above being said, facts (even skewed ones) are better than personal opinions which are often presented as fact. Unfortunately, many people are gullible and as long as what someone says confirms what they want to believe they don't question it or the source. I have read some pretty outrageous comments on a variety of topics which were written with no proviso, such as, IMO. The result is many people read these personal comments and believe them to be facts. They aren't and that is dangerous. It leaves people making decisions about important matters based on erroneous information.

[tonymctones]

I'm not an accountant (or even good w/math!) so I may need clarification/help but:

Both of those articles look to concentrate on the "richest 400" paying a ~16% income tax rate because their income is mainly based on capital gains and dividends (which are taxed at the lower rate), right?

Not all the "rich" fall into this category and not all of them use loopholes etc such as those in Section 4 of your second article.  Plus the hedge managers in Section 4 eventually will pay.

Your second article is somewhat skewed, imo, in the wording of some things, for instance the case that they try to point out that people that pay no income tax still pay taxes but also make statements like "Donald Trump [lives tax free] and paid no taxes for 2 years."

That said, I'm not blind to the fact that some people do use loopholes to pay a lower percentage but some also if they made enough charitable donations (the latter not being a bad thing imo).

not only that but income from dividends is net of tax that the corporation they are receiving dividends from has already paid on that income...

so that income is techinically being taxed twice...

[tonymctones]

In theory, you are correct about the potential for "double taxation" however theories and realitities differ, see how:

A Good Business Should be Structured so It Doesn’t Pay Taxes (Or Pay as Little as Possible)
 
What the layperson doesn’t often understand is why most businesses aren’t taxed. A lot of it comes down to the double taxation of corporate profits. If you recall from Business Entities 101, a corporation is a separate legal and taxable entity. This means that corporate profits are taxed at the corporate level, and when disbursed to business owners or shareholders in the form of dividends, are taxed again at the personal level. Clearly, business owners want to avoid having their profits taxed twice, so they will structure the profits to be paid out in a way that minimizes or eliminates this. One common method of doing this is to shift the corporate profits into salaries as opposed to being paid out in dividends. The money is still being taxed, but just at the personal level.

hmmm, the problem is that most companies dont do that as you say...it really is a great idea but the fact of the matter is most companies tie the higher managers income into the profitability of the company.

This helps to limit the amount of self intersted acts the managers perform b/c their income is ultimately tied into the companies income. Therefor whats good for the company is ultimately whats good for the manager.

Your idea is good in theory but its not the practice, the practice is to give stock options etc...

[Primemuscle]

hmmm, the problem is that most companies dont do that as you say...it really is a great idea but the fact of the matter is most companies tie the higher managers income into the profitability of the company.

This helps to limit the amount of self intersted acts the managers perform b/c their income is ultimately tied into the companies income. Therefor whats good for the company is ultimately whats good for the manager.

Your idea is good in theory but its not the practice, the practice is to give stock options etc...

It would be dishonest for me to take credit for this idea it came from an article written by an economist....which I am not.

[tonymctones]

It would be dishonest for me to take credit for this idea it came from an article written by an economist....which I am not.

well its a good idea from the private arenas point of view i would say. I think that a person of your opinion would think of it as a bad idea seeing as it strives to keep more of the money in private hands and out of the govt.

either way, its not really common practice for the managers of corporations especially those whos actions severely effect the corp.

If you make the managers income tied to the price of the companies stock like they do in stock options. Then you dont see the self interested acts you do when their income is tied with hitting numbers or simply giving them a salary. This is why the CEO's, VP's, CFO's etc...get stock options as part of their compensation, to keep them honest

[Skip8282]

Is that suppose to be insulting to me? Quite the contrary; there is every reason to believe I have a lot more financial and political experience than you do since by calling me grandpa, you give others the impression you are far less mature and much less experienced than I am.

Still got nothing gramps?  Keep trying, keep failing.

[Skip8282]

And still, nobody wants to lead by example?

lol

[Soul Crusher]

And still, nobody wants to lead by example?

lol

we know Bama sure as he'll didn't. 

[whork25]

I guess nobody wants to pay more taxes. What a surprise

[Butterbean]

Is it easier to use loopholes to pay less if the company is publicly traded? 

If so, does anyone know how to find out approximately what percent of companies are publicly traded?

[tonymctones]

Is it easier to use loopholes to pay less if the company is publicly traded?  

If so, does anyone know how to find out approximately what percent of companies are publicly traded?

The thing is that those that are publicly traded generally are going to have more opportunities to exploit those loopholes bc of the amount of activity that their larger businesses take part in.

I actually would think that the private companies have an easier time of using tax loopholes as they dont have to report straight to the SEC with 10k's/10Q's

Im no tax guru but I think that the public companies get the bad wrap one b/c they have to report their financials so the public gets to see their income and tax burdens as opposed to the private companies that dont and can hide them. Also b/c their income is much higher by nature and it makes their tax burden seem smaller in comparison.

Im not sure about the % of publicly traded corps but I would think that the amount of private corps FAR outweighs the amount of public ones.

[Emmortal]

Is it easier to use loopholes to pay less if the company is publicly traded?  

If so, does anyone know how to find out approximately what percent of companies are publicly traded?

The big loopholes are in the multi-national corporation tax codes.  Basically multi-national corporations can use losses in other countries they operate in to offset profits here in the US allowing them to pay little to no taxes (i.e. GE paying zero taxes in 2010 IIRC).  GE used their massive losses in Ireland to offset their massive profits here in the US allowing them to not pay a dime in taxes.

That's where the large tax revenues are being "lost".

[Butterbean]

Thanks guys, I was thinking along the line of Emmortal's line of thinking...the bigger/more public, the more used loopholes...

And also in tony's line, I'm under the impression that there are many more Private Companies than huge/public ones. 

So I am under the impression that people that think "all or most of the rich" don't pay taxes, or pay a much lower rate than 30+% are basing their assumption on what happens with these huge companies and not often w/the smaller, private companies, of which there are many more.   It seems like they are just lumping all the "rich" together and making a blanket assumption.

That Warren Buffet statement that he paid ~17% rate while his secretary paid more, I think is ingrained in some people's minds that all the "rich" only pay ~16% which is clearly false.

[tonymctones]

The big loopholes are in the multi-national corporation tax codes.  Basically multi-national corporations can use losses in other countries they operate in to offset profits here in the US allowing them to pay little to no taxes (i.e. GE paying zero taxes in 2010 IIRC).  GE used their massive losses in Ireland to offset their massive profits here in the US allowing them to not pay a dime in taxes.

That's where the large tax revenues are being "lost".

this has more to do with gaap than tax loopholes.

gaap says that you must consolidate your operations and any companies that you have controlling interest in into the parent companies financials...

thats what your example falls under, if you simply take into account the money brought in and expenses incurred in the US. how do you account for the income and expenses earned and spent in other countries?

so this is in accordance with gaap and not a tax loophole.

[tonymctones]

Thanks guys, I was thinking along the line of Emmortal's line of thinking...the bigger/more public, the more used loopholes...

And also in tony's line, I'm under the impression that there are many more Private Companies than huge/public ones. 

So I am under the impression that people that think "all or most of the rich" don't pay taxes, or pay a much lower rate than 30+% are basing their assumption on what happens with these huge companies and not often w/the smaller, private companies, of which there are many more.   It seems like they are just lumping all the "rich" together and making a blanket assumption.

That Warren Buffet statement that he paid ~17% rate while his secretary paid more, I think is ingrained in some people's minds that all the "rich" only pay ~16% which is clearly false.

agreed, agreed and agreed.

most ppl also dont take into account that the ppl that own or operate corporations also are paying the corporate tax before they even get their share of the profit that is TAXED AGAIN by the federal govt for federal income tax and in some states yet AGAIN for state income tax.

So their idea is far from on point and is a simple statement for a very complex issue.