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I support a tax code that actually taxes the earnings of the ultra wealthy. The whole pay yourself 80k, then just borrow 50MM using your stock options as collateral, and with no intention of every paying a cent back, and thereby not paying taxes shit is ridiculous.
I am typically skeptical of attacks on capital/wealth and ever raising taxes - but I do agree that our definition of income is NOT working. We have to have a reasonable way to tax unrealized gains for folks who can live the high life with no apparent income. It creates all kinds of odd incentives and is not conducive to effective labor markets, efficient financial markets or funding a stable and enabling societal ecosystem that capitalism requires as a foundation.
 
That's taxing corporations, not individuals.

It's also a little ridiculous because it's not how the US worked for much of our history, ultra low taxes and a spiraling genie index is a product of the last couple of decades.

I am in no way advocating for some sort of communist whatever. I'm saying, let's look at the last 200 years or so of American history. Think about the decades in which we were the most globally competitive.

Tax bracket needs to change, tax code needs to change to account for changes in how people shelter their wealth, treaties need to be made with other countries to reduce tax havens.

Someone who is making 50MM a year should be taxed (all in) at the very least at the same rate someone who is making 50k.

If you're making 50MM a year it's because you have hundreds of employees working for you, all who drive to work on public roads, were educated in public schools, who will retire with social security benefits, and will likely utilize publicly funded medical care at some point in their life.

Your not being taxed as part of some Marxist plot, your paying for the portion of the shit you used to build your business and make your money, and by doing so you are making sure your business has the infrastructure to continue.
I agree with most of your points. I'm not saying the rich shouldn't be taxed. I think we all need to pay our "fair" share. Just pointing out that "taxing the rich" doesn't usually result in the intended outcome. I don't claim to have all the answers because I surely don't. I think simplifying the tax code and some sort of flat tax would be a good start.
 
I agree with most of your points. I'm not saying the rich shouldn't be taxed. I think we all need to pay our "fair" share. Just pointing out that "taxing the rich" doesn't usually result in the intended outcome. I don't claim to have all the answers because I surely don't. I think simplifying the tax code and some sort of flat tax would be a good start.

The problem is that if you have the means you don't generate "income" in the same way that you or I do. I work, you work we get paid a salary or by the hour that's income and we pay taxes.

Most super high earners use strategies, like the one I outlined above, so that they receive no taxable income. Compensated with stock options, then they leverage those options, nothing was sold, nothing generates "income" so they buy their jet or house in the Hamptons, or mega ranch in MT and never pay a cent.

I'm not saying eat the rich, I'm simply saying we need to update tax policy and definitions to so that everyone is paying.
 
The problem is that if you have the means you don't generate "income" in the same way that you or I do. I work, you work we get paid a salary or by the hour that's income and we pay taxes.

Most super high earners use strategies, like the one I outlined above, so that they receive no taxable income. Compensated with stock options, then they leverage those options, nothing was sold, nothing generates "income" so they buy their jet or house in the Hamptons, or mega ranch in MT and never pay a cent.

I'm not saying eat the rich, I'm simply saying we need to update tax policy and definitions to so that everyone is paying.

i almost wonder if in some fantasy if we managed to close every single loophole taken advantage by the ultra wealthy, and i mean literally every single one, and just by taxing the high earners at a very reasonable amount, like any other middle class american, that we would be blown away at the tax revenue

i always laugh at the constant whine to "tax the ultra wealthy" and "they need to pay their fair share!!!" - feels good at the polls, but doesn't change jack chit about how much they actually get taxed
 
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I am typically skeptical of attacks on capital/wealth and ever raising taxes - but I do agree that our definition of income is NOT working. We have to have a reasonable way to tax unrealized gains for folks who can live the high life with no apparent income. It creates all kinds of odd incentives and is not conducive to effective labor markets, efficient financial markets or funding a stable and enabling societal ecosystem that capitalism requires as a foundation.
Luxury tax on hookers, blow, and art work would build a good footing for that foundation. 🙂
 
I'm saying, let's look at the last 200 years or so of American history. Think about the decades in which we were the most globally competitive.
I agree we need to look at our past successes - but I don't think our ever-changing individual tax policy is the lesson that can be drawn from it. Our initial global economic impacts in the 1800's were driven by applying cheap labor to abundant natural resources with little attention to nature or the people (the "china" of that era). Our second major impact was post WW2 - where we were the only large industrialized country that did not have its industrial base decimated by the war. We were competitive not because we were uniquely efficient (Japan taught us that in the 80's) we were competitive because we were the only game in town. And we used our military strength during the cold war to extend that advantage with some pretty heavy-handed business practices in the 60s & 70s.

I think we need to look more at Germany today more than the US of our past. They seem to be the best example of how a large complex country (NOT Sweden) to maintain high standards of living, reasonable economic equality, stable financial systems, all while being a high-cost economy. A mix of America's dynamism and German economic discipline would be a world-beater of the next hundred years. But these are of course in nature tension with one another - but not sure the US is currently in that sweet spot.

DISCLAIMER: I love America - we have done and will continue to do amazing things - I have traveled the world and there is no place I would rather live - but I do believe the American exceptionalism narrative needs a little hard honest feedback.
 
The problem is that if you have the means you don't generate "income" in the same way that you or I do. I work, you work we get paid a salary or by the hour that's income and we pay taxes.

Most super high earners use strategies, like the one I outlined above, so that they receive no taxable income. Compensated with stock options, then they leverage those options, nothing was sold, nothing generates "income" so they buy their jet or house in the Hamptons, or mega ranch in MT and never pay a cent.

I'm not saying eat the rich, I'm simply saying we need to update tax policy and definitions to so that everyone is paying.
I agree. I think a flat income tax would be a good start. I'd rather have some sort of a flat consumption tax. That way you, I and everyone has control over how much we are taxed. You want to be a hermit and live on rice and beans. You pay hardly any taxes. You want to buy that fancy jet, you pay a lot of taxes.
 
i almost wonder if in some fantasy if we managed to close every single loophole taken advantage by the ultra wealthy, and i mean literally every single one, and just by taxing the high earners at a very reasonable amount, like any other middle class american, we would be blown away at the tax revenue

i always laugh at the constant whine to "tax the ultra wealthy" and "they need to pay their fair share!!!" - feels good at the polls, but doesn't change jack chit about how much they actually get taxed
While pre-Reagan the game was in the thousands of "loopholes", the bigger game now is the definition of "earn" or "income" itself as @wllm1313 has explained a few times. A zero deduction, zero "loophole", zero off-shore tax haven, flat tax would still result in millionaires paying zero taxes because the flat tax is against INCOME, not unrealized asset gains. 10% X zero is still zero.

We have to find a way to have this huge source of wealth (and dare I say income) subject to the same taxes 95% of Americans pay through payroll income taxes, without creating a system with unintended consequences/incentives that destroy the underlying asset value (think of passing down the family farm to the kids - if the tax consequences are too steep, selling it off is the only option).
 
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The problem is that if you have the means you don't generate "income" in the same way that you or I do. I work, you work we get paid a salary or by the hour that's income and we pay taxes.

Most super high earners use strategies, like the one I outlined above, so that they receive no taxable income. Compensated with stock options, then they leverage those options, nothing was sold, nothing generates "income" so they buy their jet or house in the Hamptons, or mega ranch in MT and never pay a cent.

I'm not saying eat the rich, I'm simply saying we need to update tax policy and definitions to so that everyone is paying.
How do they get away from not paying the loan back? Give some examples of who is doing this.
 
While pre-Reagan the game was in the thousands of "loopholes", the bigger game now is the definition of "earn" or "income" itself as @wllm1313 has explained a few times. A zero deduction, a zero "loophole", zero off-shore tax haven, flat tax would still result in millionaires paying zero taxes because the flat tax is against INCOME, not unrealized asset gains. 10% X zero is still zero.

We have to find a way to have this huge source of wealth (and dare I say income) subject to the same taxes 95% of Americans pay through payroll income taxes, without creating a system with unintended consequences/incentives that destroy the underlying asset value (think of passing down the family farm to the kids - if the tax consequences are too steep, selling it off is the only option).

well, i think now we're arguing the definition of loophole

a simple guy like me says leveraging the ambiguity of what qualifies as income a loophole

even more general, finding a way, any way, to legally not pay taxes is a loophole ;)
 
While pre-Reagan the game was in the thousands of "loopholes", the bigger game now is the definition of "earn" or "income" itself as @wllm1313 has explained a few times. A zero deduction, a zero "loophole", zero off-shore tax haven, flat tax would still result in millionaires paying zero taxes because the flat tax is against INCOME, not unrealized asset gains. 10% X zero is still zero.

We have to find a way to have this huge source of wealth (and dare I say income) subject to the same taxes 95% of Americans pay through payroll income taxes, without creating a system with unintended consequences/incentives that destroy the underlying asset value (think of passing down the family farm to the kids - if the tax consequences are too steep, selling it off is the only option).
What you are proposing will distroy the underlying asset value. Period.
 
I'd find a better news source.😉

bbc more credible? at least they use the word alleges and alleged a lot ;)


"That's not to say these super rich folks have no money coming in to pay their yacht bills. There is a widespread tactic employed by the rich to borrow cash secured against their vast wealth - which again is not income - it's proceeds of a loan and here's the (perfectly legal) biscuit-taking bit.

The interest on that loan can be deducted from any other income to further reduce income tax liability. It sounds egregious - but it's legal."
 
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While pre-Reagan the game was in the thousands of "loopholes", the bigger game now is the definition of "earn" or "income" itself as @wllm1313 has explained a few times. A zero deduction, zero "loophole", zero off-shore tax haven, flat tax would still result in millionaires paying zero taxes because the flat tax is against INCOME, not unrealized asset gains. 10% X zero is still zero.

We have to find a way to have this huge source of wealth (and dare I say income) subject to the same taxes 95% of Americans pay through payroll income taxes, without creating a system with unintended consequences/incentives that destroy the underlying asset value (think of passing down the family farm to the kids - if the tax consequences are too steep, selling it off is the only option).
Would a flat consumption tax not accomplish that? What are the arguments against that? There would be no loopholes for the ultra rich to hide in.
 
I agree. I think a flat income tax would be a good start. I'd rather have some sort of a flat consumption tax. That way you, I and everyone has control over how much we are taxed. You want to be a hermit and live on rice and beans. You pay hardly any taxes. You want to buy that fancy jet, you pay a lot of taxes.
What you are proposing will distroy the underlying asset value. Period.
Over the course of my life the value of my labor is reduced by 20-50% depending on the year via taxation - but it was not destroyed. But if my jobs had paid me in certain types of equities instead of salary the value of that "pay" would have been reduced by much much less than that. We need to find a way that generating funds to live your life should be taxed similarly regardless of if you do so by labor or by finance wrangling. I have seen two professionals both with similar educations working shoulder to shoulder for the same company for a decade - both lived an upper middle-class life - one ended up with a nice 401k and a decent saving account while paying 40%ish in taxes along the way. The other ended up with tens of millions in equity with a tax burden in the low teens. This makes no sense - but one's role was salaried and the other got paid a draw plus residual equity in the investment that (at least at the time) was taxed very favorably - neither put their own capital at risk.
 
Propublica is left leaning, but the article is factually sound. You asked for a detailed explanation, there it is, what if anything that should be done about those facts is entirely up to the individual.
Didn't see anything in the article about borrowing money against their assets and not paying it back. That was what I was interested in. Thanks.
 
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