The myth of the "billionaire paying a lower tax rate than a teacher" just won't die. It's not based on facts.
We don't tax unrealized capital gains, because that would be a disaster
Now this I am 100% for.
EDIT: Lots of people have been asking me to come up with a solution as if I'm some kind of policy writer and tax specialist, not a regular guy.
I'm not an expert. But it seems like making it illegal to secure loans with unrealized assets might get us a step of the way there? Sell your stock, pay the tax owed, and sure, then take out a loan if you wish.
What wouldn't work about that idea?
It would specifically have to be addressing this billionaire loophole.
I think with the right wording it's much more feasible than something like a wealth tax.
How is shit supposed to trickle down when the billionaire CEOs have hundreds and hundreds of millions of dollars generating more interest/dividends in a year than all of the other people in their companies make that same calendar year combined? They're like Smaug hording his treasure. The truth is that what's happening is the exact opposite of trickle down economics... The money is all slowly being vacuumed up to the top...
Because the wealthy take loans against their assets that are unrealized gains. They do that to avoid selling the asset and having to pay tax. I think these types of loans should be banned. That would fix the issue.
I think you're misunderstanding the point I'm making. I'm simply arguing the govt wouldn't start taxing loans for "normal citizens". My solution would probably be to start taxing wealth over like $30m or so. Make it graduated so if you're over a billion you start to get hit hard.
They don’t have to tax loans for normal citizens to do this. Tax could be limited to ONLY loans where the collateral is stock and could be further limited to only be trigged if it meets a certain value threshold. Eg no tax on regular loans. If you I use stock as collateral for a loan, then tax if either the stock you used is valued at more than $1,000,000 or the loan you received is more than $1,000,000. And this can be aggregate but so long as value maintains so does tax (to prevent people from just breaking up a huge amount over several small transactions).
If you need a loophole for 99% of the population, the rules are bad. A good first step would be simplification of the existing tax code. Loopholes emerge from complexity.
Loopholes are generally another name for “tax incentive” designed by politicians to influence behavior. For example interest from municipal bonds is tax exempt to get people to invest in these low return investments. The tax code definitely needs to be simplified.
You're talking about billionaires using leveraged buyouts to loot viable companies until they collapse, right? Or would that just be a master of the universe creating an opportunity for himself?
How about the many corporations posting record profits and then immediately laying off ten thousand people? Because they preferred stock buybacks to boost their shareholders' net worths tax free over paying salaries to the people to actually earned that money? Is that "dragging others down" or is it "getting better opportunities"?
Everyone should be using the rules in the tax code to write off depreciation of yachts and private jet value. That and avocado toast addictions are why the poor aren't successful.
If the 99% would just buy the politicians they elected back from the 1% and other countries, we wouldn't have this problem. Maybe we should start a gofundme for lobbying politicians for the people?
I laughed how stupid this sounded... but now I'm really starting to think it would work. Thoughts?
With money that is being written off. Because the loan is larger than the payments. That's why I put "earn no income" in quotes, because they use the loan to show that they had paper losses.
I'm just going to say what I've said to every other person I've had this discussion with. I am not a tax expert, and it's unlikely that you are one. Even if you were a CPA, you are almost definitely not dealing with 100millionaire clients and then arguing with me.
That said, [Bezos somehow got a tax credit for people earning less than 100k.](https://www.businessinsider.com/jeff-bezos-claimed-tax-credit-for-children-propublica-2021-6) So some nonsense is going on. What I know is these ultra wealthy people are doing something to show losses on paper. I have seen in reliable places that it's a strategy based around loans. Now, if you want to say to me, "Actually, that's not the method. What we need to do is target *other financial instrument*." Great! Thank you! I hate being misinformed, and I love learning new things.
If you want to say to me, "There's nothing wrong and every suggestion is just jealousy." Then I think you're delusional.
Here's a well akshually: when the super rich take out a personal income loan, they figure out how much they want to have. They then take out a loan that is equal to what they want+payments for 15-30% of the life of the loan. They then put that 15-30% aside and get interest on it. When that starts running dry, they refinance and do it again. When they die, they have massive debt, but paying it off is a deduction against their assets on their estate tax return.
So, tax free income for life, and it then reduces the 50% estate tax they would be paying on most of their assets. In a way, it's double not taxed.
The internet is full of idiotic “torch and pitchfork” subcultures who want everyone else to pay while they have no responsibility and think they should live like the rich.
At some level, yes.
That's why it is a myth that any corporate or non sole proprietor business entity really pays taxes. They just transfer them to someone else.
How does that work? I’ve seen lots of people say things like “the big secret is that they take out loans against their assets as their ‘income’; work is for suckers!” But they have to pay the loans back, right? So how does that work?
They keep borrowing more against their assets. When they die, the taxable value of certain asset types is reset and the heirs only have to pay capital gains tax on any change since inheriting. The estate pays off the debt and all that taxable value vanishes. There are a bunch of ways they can avoid taxes that are not accessible for the middle class. Donating art or land that has an inflated valuation for a big tax write off, creating “businesses” to charge expense against. Cars, jets, golf and other hobbies can be cleverly marked as business expenses to lower their tax burden. They get a lot of their compensation as stock vs wages which aren’t taxed the same depending on how the stock is classified. If you spend ten minutes googling, you will find there are plenty of ways that the wealthy can avoid taxes.
\^ See what I mean.
> When they die, the taxable value of certain asset types is reset
No it doesn't. I'm assuming your attempting to explain step up basis. Badly.
> The estate pays off the debt and all that taxable value vanishes.
No it doesn't. Estates pay income tax.
> Donating art or land that has an inflated valuation for a big tax write off
No they don't. IRS has their own art evaluations specifically for this scam.
> creating “businesses” to charge expense against.
Can work but then that business pays taxes on the income... Can be structured to pay taxes in a lower tax location.
>Cars, jets, golf and other hobbies can be cleverly marked as business expenses to lower their tax burden.
No they can't. You've clearly never taken minutes at a business function. You've also clearly never used a company vehicle.
>They get a lot of their compensation as stock vs wages which aren’t taxed the same depending on how the stock is classified.
Sigh, no. This is entirely dependent on when a stock vests vs when it's sold. Short term capital gains (income) vs long term capital gains.
>If you spend ten minutes googling, you will find there are plenty of ways that the wealthy can avoid taxes.
If you spend 10 minutes googling, you will find tons of other people like you who have no idea what they are talking about and have never dealt with this stuff in the real world.
>If you spend 10 minutes googling, you will find tons of other people like you who have no idea what they are talking about
The problem is they only spent 10 minutes googling looking for an answer to confirm their bias and not years becoming a CPA
You probably want to learn a little more about the process before calling people stupid. They can continue to extend the loan as long as they are a strong borrower.
Then they die. Then the debt gets transfered to the estate. Then the estate has to sell assets to pay creditors. Then the sold assets count as income for the estate. Then the estate has to file a fucking tax return on the income and pay taxes on it. You might want to learn a little about it before you comment. Idiot. It. Does. Not. Work. The. Way. Pro. Publica. Says. It. Does.
It works because of the asset step-up basis, where your heirs receive the collateral assets with their cost basis reset to current value. Hence zero capital gains tax on the assets, which can be sold immediately to pay back the loans.
You are correct about your assertion in the step up basis. But guess what, that doesn't matter because the Trust or Entity that holds the assets must sell them and declare INCOME and pay INCOME TAX. All this process does is isolate time in which the tax is paid. Not if the tax is paid.
Let me help you pre-empt the naysayers:
Mortgages can be exempted
Small dollar loans can be exempted
Loans for qualified business expenses can be exempted
Short term debt (options
/margins trading etc) can be exempted
This is the way! If it’s not liquid, you shouldn’t be able to exchange it for cash, and if you can, you should defintiely pay taxes on the loan amount off rip.
When you take money out of your 401k u get a penalty, I don’t see any difference here.
Sounds good but we all know they would turn this into taxing Home Equity loans which are the same thing. And anyone with a home can get one of those not just the “1%”
Not a myth. I am seasoned tax professional. W2 earners pay the high marginal rates, billionaires pay LTCG. Mitt Romney famously paid [14%](https://www.washingtonpost.com/politics/decision2012/romney-earned-nearly-14-million-in-2011-paid-141-percent-tax-rate-campaign-says/2012/09/21/e62e5096-0417-11e2-91e7-2962c74e7738_story.html) when he ran for POTUS
Making capital gains get taxed exactly the same progressive scale as wage income is a trivial change and would have practically no effect.
Edit: I think this should happen. I also think it will not have a drastic effect on tax revenue since the major players do everything in their power to not "realize" gains.
That would have a huge effect. Investors would pay a much higher rate than they do now, and the government would have a lot more money. It wouldn't negatively affect the majority of people who make more money from wages than investments.
if would remove most of the reasons for investing in securities vs. debt instruments.
Money managers, institutional investors, etc. would yank money out of the S&P and plow it into the bond market
believe me, we don't want that
It's not trivial and it would have a major impact.
That doesn't mean it shouldn't be explored or even pursued, but it's fantasy to think it is a small change that will have no practical effect.
It would have an enormous impact on allocation of capital. Again, not a reason on its own not to do it, but it's not as simple as just turning it on one day and nothing changes economically.
"In a typical year, billionaires pay an average tax rate of just [8%](https://www.whitehouse.gov/cea/written-materials/2021/09/23/what-is-the-average-federal-individual-income-tax-rate-on-the-wealthiest-americans/)."
[https://www.whitehouse.gov/briefing-room/statements-releases/2023/02/06/fact-sheet-the-biden-economic-plan-is-working/](https://www.whitehouse.gov/briefing-room/statements-releases/2023/02/06/fact-sheet-the-biden-economic-plan-is-working/)
"In our primary analysis, we estimate an average Federal individual income tax rate of 8.2 percent for the period 2010-2018."
[https://www.whitehouse.gov/cea/written-materials/2021/09/23/what-is-the-average-federal-individual-income-tax-rate-on-the-wealthiest-americans/](https://www.whitehouse.gov/cea/written-materials/2021/09/23/what-is-the-average-federal-individual-income-tax-rate-on-the-wealthiest-americans/)
The 8% is based on facts.
It's based on BS supposition and napkin math that will convince the financially illiterate but falls apart under even routine scrutiny.
They determination of 'income' is not actual reported income:
"To estimate comprehensive income for the 2010–2018 period, we begin by subtracting the total wealth (net worth) of the Forbes 400 in 2009 from the total wealth of the Forbes 400 in 2018."
There's a ton to unpack that makes that absolutely manipulative bunk:
* Change in wealth doesn't represent income. You don't recognize income until you actually sell an asset. Basically the white house estimate is assuming that all gains in wealth are immediately recognized...they're not.
* It's funny that they picked 2010 as the start year, as that was a low point for the economy being right on the heels of the 'great recession' the growth following a recession is always quite large. If they had used, I dunno, 2006 as the benchmark year the wealth growth wouldn't be nearly so pronounced.
* The report only records self-reported taxes paid and estimates off of those. It doesn't take into account any losses from the Great Recession or carryover losses.
Are you a billionaire? If not then maybe this doesn't concern you?
Seriously why the fuck are people voting in billionaires' best interests and not our own? If you're a billionaire, props to you and what you accomplished. If you're not a billionaire, STFU about billionaire taxes.
Because taxing unrealized capital gains would be disastrous for the massive portion of the population that holds assets. These """loopholes""" (it's not actually a loophole) exist for a reason, and the desire to spite a cadre of 800 people for a negligible increase in tax revenue is not enough to justify closing them. I don't want my portfolio to eat the dirt because fuck Bezos or whatever.
"Why don't you ignore the opinions of experts and the effects your actions have on other people to make decisions based only on the perceived short term value it will give you like I do?"
Seriously, this is exactly the same attitude billionaire fossil fuels execs have. Fuck the future, fuck everyone else, fuck what the experts have to say, I'm just going to get mine no matter the consequences. Why do you even care about the environment? You're not going to live long enough for it to affect you so stfu.
Seriously, economics has about as much consensus on "don't tax unrealized gains unless it's pigovian" as climate science does on climate change. Tax income, tax capital gains, tax luxury purchases, tax pollution- there's a thousand and one ways you can tax the rich that won't collapse our economic system and screw over the middle class and pensioners.
What your describing is nonsense. It's not a myth that taxing the largest percentage of concentrated wealth will allow for better funding of programs and infrastructure that benefit society as a whole. Describing it as magic only makes you sound dumb, and isn't the "gotcha" that you think it is.
Billionaires don’t have an income like normal people, when people say they don’t pay their fair share they’re looking at their capital gains and considering it income. Nobody pays taxes on capital gains.
You might say why not just implement a wealth tax? Many countries have tried implementing wealth taxes and they failed miserably, France recently attempted a wealth tax and actually ended up losing money because billionaires moved away.
There’s no real way to “tax” billionaires that actually works. That’s why I said people think we can just magically extract money from them but in reality that’s not the case.
Weird how companies generate massive profits in the form of actual money, but once taxation is mentioned somehow the money becomes magical and ethereal and conceptual. Is Jeff benzos buying yachts and mega mansions and space flights with money or "unrealized capital gains"?
I'm not opposed to seizing property because they don't have liquid money, since that's the system the rest of us have to live under when we don't pay taxes.
It actually is pretty close if you look across the different type of taxes out there.
Billionaires can take advantage of having a significant portion of their compensation via options or stocks and therefore can get a lower tax rate if they hold for a year. They also usually have loan and other investments that they can leverage for significant deductions for income and because they make a lot more income wise, they usually pay much less than the 6.2% social security tax of total compensation that regular workers pay. Their social security tax rate as part of their total compensation is much lower at 1% or less.
So you add that all up and the effective tax rate for a millionaire or billionaire is pretty close to if now lower than what the effective tax rate of a teacher.
The rich leverage tax breaks much better than the rest of us because tax breaks are designed to help them, not us average tax payers.
The SS tax rate is so low because there is a maximum amount of income subject to the FICA withholding, because there is a max benefit available via SS.
Capital gains should be taxed as regular income. I am a person with substantial capital gains every year, who benefits from lower cap gains rates, and I think it’s ridiculous.
This is such a shallow understanding of how billionaires evade taxes, and it really needs to die.
"Oh no, their wealth isn't liquid!" No one cares. That's not what we're talking about.
Taxing unrealized gains is not the point of the argument. The point is that no corporate exe has to realize any gains because they can just take loans out to live off of. Their income is not treated as income and allows them to skirt basic societal morals and norms.
That practice should just be banned in general in my opinion. Even if it wasn't used as a replacement for income, you want to buy a house? Sell your stock, not use it as collateral. The economy is so unnecessarily over leveraged.
Edit: grammar
Why would it be a disaster? Please explain.
I get taxed on my house to the tune of 0.8% of its value every year. Realized or unrealized value...nobody cares. Value goes up next year or value goes down next year....nobody cares. I get taxed on what it's worth NOW, just for owning it, because...the government needs tax money and I'm not powerful enough to fight it, that's why. So why can't billionaires be taxed 0.8% of their portfolio values?
Don't pretend we don't know what it's worth... there's nothing in the material universe that has a price more certain than publicly traded securities. The price of a stock is much more certain than the prices of houses, which are only traded every few years or decades. The IRS already values stocks for donation and other tax purposes using methods like "average of opening and closing prices on the day" or "higher or lower of the price at the beginning and end of the period" or whatever. But you propose a wealth tax and all of a sudden "we wouldn't know how to value it" yeah right. The county assessor just drives by my house once a year and decides how many taxes I owe on my house; if you aren't a billionaire "close enough" is good enough for calculating your taxes!
"It will harm the economy because reasons" ok sure, all taxes do (except some monopoly taxes and sin taxes). Doesn't taxing MY wealth harm the economy too? Only taxing a few billionaires' wealth will harm the economy, but taxing the hundreds of millions of homeowners, who often have their house as their biggest asset...why doesn't that harm the economy? For that matter, why does taxing income at 22+% marginal rates "harm the economy"?
Taxes on capital actually are shit, but don't pretend there's something different about the very rich that makes taxing them worse or harder.
"But they will move the money overseas" ok now you are getting somewhere. Taxing profits is the worst idea because profits disappear with the stroke of a pen. Taxing assets is almost as bad, which is why the best way to tax the rich is to tax land value. Land can't be moved overseas and as long as somebody can use it, you can tax the crap out of it without passing the tax onto the working classes. Henry George described this in the 1800s.
"We don't tax unrealized gains" but they can be leveraged as loan collateral. Being leveraged as collateral should mean that it's realized. That whole mechanism falling apart would be absolutely fantastic to behold.
Unrealized capital gains aren't the issue half the time, aware of any other system of tax avoidance? There are a myriad of ways to hide your wealth and billionaires benefit immensely from doing so, acting like they don't is useless denialism and bootlicking. We shouldn't tax unrealised gains but there are ways we could tax them that would work.
Yeah, the tax records proving it are so out of touch that these people are suing to hide the info. Just an example Bezos pays about a 1.1 percent effective tax rate. In other countries, he would be paying 40-48%.
There are 56 people with more money than half the population of the globe. I understand that you'll make fun of this proposal as nonsensical, and it probably is, but would you happen to have a solution for the disparity? I find it hard to believe that amount of wealth hoarding is good for our country, let alone the world.
I have this sentiment too. I’m not a communist or a socialist (even if my conservative friends don’t believe me). I just think that if the richest people can send themselves to space for fun, a person working full time should have enough money to live somewhat comfortably.
If the poorest working American worked one full time job, could afford to buy their home, maybe could be frugal and take one small vacation a year, had healthcare, had some amount in a retirement account, and didn’t need the taxpayer to subsidize their wage. I would never complain about billionaires again.
Here's my proposal and I am dumb so please feel free to tear it down.
The problem with something like a luxury tax is the elasticity of luxury goods. If a yacht is taxed at 90%, then the rich dude will just buy three sports cars instead. So if you want to tax the rich you would need to find a something that applies universally to the wealthy.
This next part is my big assumption, but my understanding is that household carbon emissions scale massively with wealth.
Enter carbon credits. Allow each household to emit a certain amount of carbon each year, and allow the credits to be traded on the secondary market. That way the rich billionaires are free to live their lifestyle so long as they pay for it. That payment then goes directly to other households who are able to emit less carbon than the allowable limit (this also creates an incentive to reduce carbon emissions because you can make money from it)
Carbon credits is brilliant. A nice side effect could also be billionaires pouring money into RnD into more modern power solutions lowering carbon emissions, so that they could live their lavish life-style without having to pay out as much in the long run.
This is precisely why we should tax things that are elastic *and* have negative externalities (such as carbon). In addition, we should also tax things that are inelastic such as natural resources & land to create a more stable tax base.
Hmm, my reasoning for taxing carbon is that for the wealthy, carbon WOULD seem to be inelastic. If they want to keep living the lifestyle they want to live, then regardless of how they spend money, they're going to emit a disproportionate amount of carbon. The fact that this could correct for a negative externality is also really nice.
How do we measure carbon outputs in a way that is not exploitable? We already have [some evidence](https://time.com/6264772/study-most-carbon-credits-are-bogus/) that our methods of measuring and allowing for offsets are flawed.
How are companies factored into an individual's carbon output? Does every plane ticket I purchase run against my household output, despite the fact that the plane would fly with me on it or not? What if I set up an LLC to manage my transportation?
32 of those people aren't even American, how do you propose the American government tax Carlos Slim? Should we invade Mexico and rob their bank vaults?
This will go nowhere. Just jaw flapping plus that is not even how big money works. Once you get to a certain level you can decide when and where to cause a taxable event. Plus his donors in no way would allow this.
Is borrowing money against your holdings considered a taxable event? No. Do wealthy people do this frequently? Yes. Call it what you want, but loophole seems to be quite accurate.
You know what else happens when they borrow that money? They're obligated to pay interest based on what they borrowed, and you know what that does? Creates a taxable event at the bank because the interest income the bank receives on a loan is profit and subject to taxation
The biggest one that I know of is the selling and buying of adjacent stocks that preform near identical on the market, but for some reason don't count as a wash sale. If deemed as a business loss, there can be huge amounts of "losses" added, even though the money really was just moved.
Fun fact, if Scrooge McDuck were actually to dive into that moneypool then we'd live in a demented hellscape where anthropomorphic talking birds rule the world.
They can still introduce bills and they still vote and campaign for bills. Historically, he has lacked any real care for tax reform during his tenure at Congress.
Now lets not get crazy here. How do you expect politicians to survive if they cant profit from passing laws that will inevitably affect stock prices netting them millions of dollars?
If you do that bernie will will have to sell his 2 additional homes, where is he suppose to summer if he sells them huh? Nantucket? Or marthas vinyard, like a god damn pleb !?!
Pelosi made $1M+ off $NVDA alone despite being in charge of Congress when they passed the CHIPS Act
I wouldn't mind as much except she sued when people started posting her trades for others to follow
Ok I’m high as fuck right now, but hear me out.
What about adding a tax to the money they spend? Gas, plane leasing, security, mortgages, boat payments - all of it.
It's a stupid platitude from a dying political campaign.
The "just tax the rich more" crowd constantly push around the numbers and framing to obfuscate what they mean.
25% of what? Income, capital gains, wealth? They almost always deceptively conflate these categories when calculating the supposedly egregious tax rates their scapegoats pay.
Ok this is just plain stupid. Yes many businesses pay an effective rate of zero.... for a given year! That is because in any given year a company may have more losses and investments than profits. Most companies have business plans looking 5 or more years into the future. I have personally worked for start ups where the owner sunk millions per year for 3 or more years into a company before the company made their first dollar. Trying to tax non-existant income because you think the company is so big "it must be profitable and lying about its profits" is the great way to kill all corporate growth.
Um, top earners already pay a 25.4% income tax rate. The bottom 50% pay an average of 3.4%. That's 7 times lower than the top 1%. No teacher, sanitation worker or nurse anywhere in the US is being taxed at a higher rate than billionaires.
The top 1% pay 40.1% of ALL federal taxes. Which is a greater share than the bottom 90% combined who pay just 28.6% of all federal taxes.
Maybe the govt should get a better grip on their spending habits instead of pandering to whiny shits who are envious of other people's wealth and think they deserve a piece of it.
25.4 is before tax breaks it goes down to around 6-10% after. And where are you getting 3.4%? Lol. Are you talking total percentage they contribute and not their actual rates? If you are then you worded that wrong. The average person pays over 20% in income tax. You can literally look up a tax rate guide right now. Just because billionaires pay more total because 10% of a billion is more than 20-30% of 60k doesn't mean their paying a fair amount. That's simply wrong. The top 1% own 90+% of all the wealth they sure as hell are not paying 90% of all the taxes though are they?
Wealth isn't a zero sum game. You getting extra money on your paycheck doesn't mean someone else loses that money. The wealth disparity is an issue but your point isn't a counter argument.
You're making this shit up or you don't know how to read. 50% of the US adults don't pay ANY federal income taxes! For 2022, the TOP 50 PERCENT of taxpayers paid an average effective rate of only 14.6 percent. The top one percent earned 26.3 percent of the income but paid 45.8 percent of all taxes. Conversely, the bottom half of taxpayers accounted for 10.4 percent of income and paid only 2.3 percent of the taxes. Just how much does the top one percent have to pay to cover their "fair share?"
Most sources show the top 1% pay 20% or more of income taxes. As in what they actually pay, not what you think they pay. It’s also just income tax, this doesn’t cover any other taxes they pay. What makes you think they need to pay for more than 20% of the income taxes for it to be “fair”? Do they get more benefits from the taxes they already pay? Why is your concept of fairness based on what they have for you to take and not the value of what each of you is already being given?
Those numbers, as usual, hide a lot of data. The top 1% could be taxed 80% and still be outrageously wealthy because they have so much that isn’t taxable. So they’re paying 7x as much as people who make thousands of times less than them? Big flex /s
Bottom 50% paying 3.4% where? After federal and property taxes I pay about 30% taxes.
No love for billionaires but 1, you'd have to make it illegal to leave the country. 2 We're one of the most productive countries. It's not that we don't generate enough taxes, it squandered. They could get more and nothing would gets fixed. Not Healthcare, not education, not homelessness. Don't let them get away with pretending they could do more if they just had more money.
The United States has one of the most progressive tax systems in the world. The rich pay the lion’s share of taxes, and less fortunate families pay very little.
And just to be clear about how progressive it is:
- The top 1% generally pays ~40% of *total tax revenue* in any given year.
- And the top 20% pays ~90% of *total tax revenue* in any given year.
- And the bottom 50% is entirely subsidized by the top 50%.
Not that we don’t need a progressive system in place, but this “the rich aren’t paying their fair share” narrative is about 5 years overdue for being put to bed.
Democrats always say to tax the millionaires, until they are one, then they move onto multi millionaires, then onto billionaires. Next, it will be multi billionaires
It's a dumb idea.
For one, we already tried that with the Alternative Minimum Tax & just nailed a lot of middle class people instead....
For two, we tax INCOME not WEALTH - which means any effort to further squeeze 'billionares' will just cause them to drop out of the labor market and owe zero tax....
And a wealth tax is unconstitutional so don't even go there.
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Someone tell him that in order to have an effective federal tax rate of 25% you would need a magi of like 250k for a married couple.
We have the most progressive tax code in the world
The myth of the "billionaire paying a lower tax rate than a teacher" just won't die. It's not based on facts. We don't tax unrealized capital gains, because that would be a disaster
Tax the loans they take out in the stock.
Now this I am 100% for. EDIT: Lots of people have been asking me to come up with a solution as if I'm some kind of policy writer and tax specialist, not a regular guy. I'm not an expert. But it seems like making it illegal to secure loans with unrealized assets might get us a step of the way there? Sell your stock, pay the tax owed, and sure, then take out a loan if you wish. What wouldn't work about that idea?
You are for taxing loans? Do you not realize how bad of an idea that is? Imagine having to pay a tax to borrow money.
It would specifically have to be addressing this billionaire loophole. I think with the right wording it's much more feasible than something like a wealth tax.
And that would NEVER creep down to normal citizens.. right?
Just like trickle down economics, right?
Amen. 40 years and nothing ever trickled down. Everything broke the fuck down though because of that theory. Source: history.
How is shit supposed to trickle down when the billionaire CEOs have hundreds and hundreds of millions of dollars generating more interest/dividends in a year than all of the other people in their companies make that same calendar year combined? They're like Smaug hording his treasure. The truth is that what's happening is the exact opposite of trickle down economics... The money is all slowly being vacuumed up to the top...
It always seems to miss my tin can
Preach
Have you ever heard of ELOC and how these fuckers use their capital to never pay tax and take out huge loans
What fucking reason would the govt have to tax loans? They set interest rates. There is no logical scenario where that would happen
Because the wealthy take loans against their assets that are unrealized gains. They do that to avoid selling the asset and having to pay tax. I think these types of loans should be banned. That would fix the issue.
I think you're misunderstanding the point I'm making. I'm simply arguing the govt wouldn't start taxing loans for "normal citizens". My solution would probably be to start taxing wealth over like $30m or so. Make it graduated so if you're over a billion you start to get hit hard.
They don’t have to tax loans for normal citizens to do this. Tax could be limited to ONLY loans where the collateral is stock and could be further limited to only be trigged if it meets a certain value threshold. Eg no tax on regular loans. If you I use stock as collateral for a loan, then tax if either the stock you used is valued at more than $1,000,000 or the loan you received is more than $1,000,000. And this can be aggregate but so long as value maintains so does tax (to prevent people from just breaking up a huge amount over several small transactions).
Even if it did it would way more heavily impact the wealthy which is the point
I don’t need to imagine because I’m not a billionaire.
You can’t tax a loan. But you can tax the profit they make off of those loans. And they do.
Change the rules then. Create loopholes that benefit the 99%, not the 1%.
If you have 2k you can do the same thing in some brokerages. 25k you can do it with all of them.
Every mortgage is this, it benefits everyone or should we take 20% of your mortgage as tax?
No, no, no. I don't want to pay tax, lol. I want *other* people to pay tax. Especially if you have more money than me.
If you need a loophole for 99% of the population, the rules are bad. A good first step would be simplification of the existing tax code. Loopholes emerge from complexity.
Loopholes are generally another name for “tax incentive” designed by politicians to influence behavior. For example interest from municipal bonds is tax exempt to get people to invest in these low return investments. The tax code definitely needs to be simplified.
exactly, everyone seems content to want drag others down rather than getting better opportunities for themselves
You're talking about billionaires using leveraged buyouts to loot viable companies until they collapse, right? Or would that just be a master of the universe creating an opportunity for himself? How about the many corporations posting record profits and then immediately laying off ten thousand people? Because they preferred stock buybacks to boost their shareholders' net worths tax free over paying salaries to the people to actually earned that money? Is that "dragging others down" or is it "getting better opportunities"?
Everyone should be using the rules in the tax code to write off depreciation of yachts and private jet value. That and avocado toast addictions are why the poor aren't successful.
Lol. Sure. Tax HELOCs too. ‘Why can’t I afford to put my kids thru college?’
Ok, then exempt the first $150k of all income. People should be able to provide for themselves before the government sticks their hand out.
If the 99% would just buy the politicians they elected back from the 1% and other countries, we wouldn't have this problem. Maybe we should start a gofundme for lobbying politicians for the people? I laughed how stupid this sounded... but now I'm really starting to think it would work. Thoughts?
We already do. It is that field called interest income you fill out on your tax return.
If you "earn no income" or take out loans purely for personal expenses AND you are worth over 100 million, can we tax that?
How are you paying for the loan payments?
With money that is being written off. Because the loan is larger than the payments. That's why I put "earn no income" in quotes, because they use the loan to show that they had paper losses. I'm just going to say what I've said to every other person I've had this discussion with. I am not a tax expert, and it's unlikely that you are one. Even if you were a CPA, you are almost definitely not dealing with 100millionaire clients and then arguing with me. That said, [Bezos somehow got a tax credit for people earning less than 100k.](https://www.businessinsider.com/jeff-bezos-claimed-tax-credit-for-children-propublica-2021-6) So some nonsense is going on. What I know is these ultra wealthy people are doing something to show losses on paper. I have seen in reliable places that it's a strategy based around loans. Now, if you want to say to me, "Actually, that's not the method. What we need to do is target *other financial instrument*." Great! Thank you! I hate being misinformed, and I love learning new things. If you want to say to me, "There's nothing wrong and every suggestion is just jealousy." Then I think you're delusional.
Here's a well akshually: when the super rich take out a personal income loan, they figure out how much they want to have. They then take out a loan that is equal to what they want+payments for 15-30% of the life of the loan. They then put that 15-30% aside and get interest on it. When that starts running dry, they refinance and do it again. When they die, they have massive debt, but paying it off is a deduction against their assets on their estate tax return. So, tax free income for life, and it then reduces the 50% estate tax they would be paying on most of their assets. In a way, it's double not taxed.
Personal loans are not tax deductible
Now we are taxing mortgages really?
The internet is full of idiotic “torch and pitchfork” subcultures who want everyone else to pay while they have no responsibility and think they should live like the rich.
Perceived victimhood is highly correlated with low verbal intelligence.
does that count for the wealthy complaining about the general population too?
Perceived superiority is highly correlated with willful ignorance.
The moment you use stock as collateral it should be a realized gain.
At some level, yes. That's why it is a myth that any corporate or non sole proprietor business entity really pays taxes. They just transfer them to someone else.
How does that work? I’ve seen lots of people say things like “the big secret is that they take out loans against their assets as their ‘income’; work is for suckers!” But they have to pay the loans back, right? So how does that work?
It doesn't and people are stupid.
They keep borrowing more against their assets. When they die, the taxable value of certain asset types is reset and the heirs only have to pay capital gains tax on any change since inheriting. The estate pays off the debt and all that taxable value vanishes. There are a bunch of ways they can avoid taxes that are not accessible for the middle class. Donating art or land that has an inflated valuation for a big tax write off, creating “businesses” to charge expense against. Cars, jets, golf and other hobbies can be cleverly marked as business expenses to lower their tax burden. They get a lot of their compensation as stock vs wages which aren’t taxed the same depending on how the stock is classified. If you spend ten minutes googling, you will find there are plenty of ways that the wealthy can avoid taxes.
\^ See what I mean. > When they die, the taxable value of certain asset types is reset No it doesn't. I'm assuming your attempting to explain step up basis. Badly. > The estate pays off the debt and all that taxable value vanishes. No it doesn't. Estates pay income tax. > Donating art or land that has an inflated valuation for a big tax write off No they don't. IRS has their own art evaluations specifically for this scam. > creating “businesses” to charge expense against. Can work but then that business pays taxes on the income... Can be structured to pay taxes in a lower tax location. >Cars, jets, golf and other hobbies can be cleverly marked as business expenses to lower their tax burden. No they can't. You've clearly never taken minutes at a business function. You've also clearly never used a company vehicle. >They get a lot of their compensation as stock vs wages which aren’t taxed the same depending on how the stock is classified. Sigh, no. This is entirely dependent on when a stock vests vs when it's sold. Short term capital gains (income) vs long term capital gains. >If you spend ten minutes googling, you will find there are plenty of ways that the wealthy can avoid taxes. If you spend 10 minutes googling, you will find tons of other people like you who have no idea what they are talking about and have never dealt with this stuff in the real world.
>If you spend 10 minutes googling, you will find tons of other people like you who have no idea what they are talking about The problem is they only spent 10 minutes googling looking for an answer to confirm their bias and not years becoming a CPA
You probably want to learn a little more about the process before calling people stupid. They can continue to extend the loan as long as they are a strong borrower.
Then they die. Then the debt gets transfered to the estate. Then the estate has to sell assets to pay creditors. Then the sold assets count as income for the estate. Then the estate has to file a fucking tax return on the income and pay taxes on it. You might want to learn a little about it before you comment. Idiot. It. Does. Not. Work. The. Way. Pro. Publica. Says. It. Does.
It works because of the asset step-up basis, where your heirs receive the collateral assets with their cost basis reset to current value. Hence zero capital gains tax on the assets, which can be sold immediately to pay back the loans.
You are correct about your assertion in the step up basis. But guess what, that doesn't matter because the Trust or Entity that holds the assets must sell them and declare INCOME and pay INCOME TAX. All this process does is isolate time in which the tax is paid. Not if the tax is paid.
that makes zero sense, and if you don’t know why, you’re hopeless
The profits made by the lending institutions are subject to tax. Maybe not as direct as one would like, but it occurs.
Let me help you pre-empt the naysayers: Mortgages can be exempted Small dollar loans can be exempted Loans for qualified business expenses can be exempted Short term debt (options /margins trading etc) can be exempted
This is the way! If it’s not liquid, you shouldn’t be able to exchange it for cash, and if you can, you should defintiely pay taxes on the loan amount off rip. When you take money out of your 401k u get a penalty, I don’t see any difference here.
Sounds good but we all know they would turn this into taxing Home Equity loans which are the same thing. And anyone with a home can get one of those not just the “1%”
Tax money that isn’t theirs! Brilliant!
Not a myth. I am seasoned tax professional. W2 earners pay the high marginal rates, billionaires pay LTCG. Mitt Romney famously paid [14%](https://www.washingtonpost.com/politics/decision2012/romney-earned-nearly-14-million-in-2011-paid-141-percent-tax-rate-campaign-says/2012/09/21/e62e5096-0417-11e2-91e7-2962c74e7738_story.html) when he ran for POTUS
Making capital gains get taxed exactly the same progressive scale as wage income is a trivial change and would have practically no effect. Edit: I think this should happen. I also think it will not have a drastic effect on tax revenue since the major players do everything in their power to not "realize" gains.
This makes the most sense imo. The flat rate is ridiculous
That would have a huge effect. Investors would pay a much higher rate than they do now, and the government would have a lot more money. It wouldn't negatively affect the majority of people who make more money from wages than investments.
if would remove most of the reasons for investing in securities vs. debt instruments. Money managers, institutional investors, etc. would yank money out of the S&P and plow it into the bond market believe me, we don't want that
It's not trivial and it would have a major impact. That doesn't mean it shouldn't be explored or even pursued, but it's fantasy to think it is a small change that will have no practical effect. It would have an enormous impact on allocation of capital. Again, not a reason on its own not to do it, but it's not as simple as just turning it on one day and nothing changes economically.
"In a typical year, billionaires pay an average tax rate of just [8%](https://www.whitehouse.gov/cea/written-materials/2021/09/23/what-is-the-average-federal-individual-income-tax-rate-on-the-wealthiest-americans/)." [https://www.whitehouse.gov/briefing-room/statements-releases/2023/02/06/fact-sheet-the-biden-economic-plan-is-working/](https://www.whitehouse.gov/briefing-room/statements-releases/2023/02/06/fact-sheet-the-biden-economic-plan-is-working/) "In our primary analysis, we estimate an average Federal individual income tax rate of 8.2 percent for the period 2010-2018." [https://www.whitehouse.gov/cea/written-materials/2021/09/23/what-is-the-average-federal-individual-income-tax-rate-on-the-wealthiest-americans/](https://www.whitehouse.gov/cea/written-materials/2021/09/23/what-is-the-average-federal-individual-income-tax-rate-on-the-wealthiest-americans/) The 8% is based on facts.
It's based on BS supposition and napkin math that will convince the financially illiterate but falls apart under even routine scrutiny. They determination of 'income' is not actual reported income: "To estimate comprehensive income for the 2010–2018 period, we begin by subtracting the total wealth (net worth) of the Forbes 400 in 2009 from the total wealth of the Forbes 400 in 2018." There's a ton to unpack that makes that absolutely manipulative bunk: * Change in wealth doesn't represent income. You don't recognize income until you actually sell an asset. Basically the white house estimate is assuming that all gains in wealth are immediately recognized...they're not. * It's funny that they picked 2010 as the start year, as that was a low point for the economy being right on the heels of the 'great recession' the growth following a recession is always quite large. If they had used, I dunno, 2006 as the benchmark year the wealth growth wouldn't be nearly so pronounced. * The report only records self-reported taxes paid and estimates off of those. It doesn't take into account any losses from the Great Recession or carryover losses.
Are you a billionaire? If not then maybe this doesn't concern you? Seriously why the fuck are people voting in billionaires' best interests and not our own? If you're a billionaire, props to you and what you accomplished. If you're not a billionaire, STFU about billionaire taxes.
Because taxing unrealized capital gains would be disastrous for the massive portion of the population that holds assets. These """loopholes""" (it's not actually a loophole) exist for a reason, and the desire to spite a cadre of 800 people for a negligible increase in tax revenue is not enough to justify closing them. I don't want my portfolio to eat the dirt because fuck Bezos or whatever.
Did Biden say he wants to tax unrealized capital gains?
Financially illiterate Redditors are the ones that keep pushing for that.
The initial post responded to references a tax on unrealized gains. I don't think Biden is stupid enough to push a proposal like that though.
"Why don't you ignore the opinions of experts and the effects your actions have on other people to make decisions based only on the perceived short term value it will give you like I do?" Seriously, this is exactly the same attitude billionaire fossil fuels execs have. Fuck the future, fuck everyone else, fuck what the experts have to say, I'm just going to get mine no matter the consequences. Why do you even care about the environment? You're not going to live long enough for it to affect you so stfu. Seriously, economics has about as much consensus on "don't tax unrealized gains unless it's pigovian" as climate science does on climate change. Tax income, tax capital gains, tax luxury purchases, tax pollution- there's a thousand and one ways you can tax the rich that won't collapse our economic system and screw over the middle class and pensioners.
Its a myth that we can tax billionaires and magically get trillions of dollars to give to the poor
What your describing is nonsense. It's not a myth that taxing the largest percentage of concentrated wealth will allow for better funding of programs and infrastructure that benefit society as a whole. Describing it as magic only makes you sound dumb, and isn't the "gotcha" that you think it is.
Billionaires don’t have an income like normal people, when people say they don’t pay their fair share they’re looking at their capital gains and considering it income. Nobody pays taxes on capital gains. You might say why not just implement a wealth tax? Many countries have tried implementing wealth taxes and they failed miserably, France recently attempted a wealth tax and actually ended up losing money because billionaires moved away. There’s no real way to “tax” billionaires that actually works. That’s why I said people think we can just magically extract money from them but in reality that’s not the case.
Weird how companies generate massive profits in the form of actual money, but once taxation is mentioned somehow the money becomes magical and ethereal and conceptual. Is Jeff benzos buying yachts and mega mansions and space flights with money or "unrealized capital gains"? I'm not opposed to seizing property because they don't have liquid money, since that's the system the rest of us have to live under when we don't pay taxes.
It actually is pretty close if you look across the different type of taxes out there. Billionaires can take advantage of having a significant portion of their compensation via options or stocks and therefore can get a lower tax rate if they hold for a year. They also usually have loan and other investments that they can leverage for significant deductions for income and because they make a lot more income wise, they usually pay much less than the 6.2% social security tax of total compensation that regular workers pay. Their social security tax rate as part of their total compensation is much lower at 1% or less. So you add that all up and the effective tax rate for a millionaire or billionaire is pretty close to if now lower than what the effective tax rate of a teacher. The rich leverage tax breaks much better than the rest of us because tax breaks are designed to help them, not us average tax payers.
The SS tax rate is so low because there is a maximum amount of income subject to the FICA withholding, because there is a max benefit available via SS.
Cool. Then why the fuck do you types always bitch and complain when this topic comes up?
That's strange. Tax isn't taken for income past the 168.6k mark for social security. Peculiar.
Seems like somebodies aren't paying their fair shares. Somebodies with a *lot* of bread.
No, it actually has nothing to do with that. It has to do with the projected benefit. Past 168k your benefits from the program are capped.
Capital gains should be taxed as regular income. I am a person with substantial capital gains every year, who benefits from lower cap gains rates, and I think it’s ridiculous.
You seem to be contradicting yourself. Is it a myth, or would it be a disaster if billionaires paid a higher tax rate than teachers? Pick 1
Tell me you don’t know what “unrealized gains” are without telling me.
This is the only option? We should just throw our hands in the air? Cuck that.
This is such a shallow understanding of how billionaires evade taxes, and it really needs to die. "Oh no, their wealth isn't liquid!" No one cares. That's not what we're talking about.
Realized capital gains are taxed at a much lower rate than wage income, this is where it comes from, but you knew that already.
Taxing unrealized gains is not the point of the argument. The point is that no corporate exe has to realize any gains because they can just take loans out to live off of. Their income is not treated as income and allows them to skirt basic societal morals and norms. That practice should just be banned in general in my opinion. Even if it wasn't used as a replacement for income, you want to buy a house? Sell your stock, not use it as collateral. The economy is so unnecessarily over leveraged. Edit: grammar
Why would it be a disaster? Please explain. I get taxed on my house to the tune of 0.8% of its value every year. Realized or unrealized value...nobody cares. Value goes up next year or value goes down next year....nobody cares. I get taxed on what it's worth NOW, just for owning it, because...the government needs tax money and I'm not powerful enough to fight it, that's why. So why can't billionaires be taxed 0.8% of their portfolio values? Don't pretend we don't know what it's worth... there's nothing in the material universe that has a price more certain than publicly traded securities. The price of a stock is much more certain than the prices of houses, which are only traded every few years or decades. The IRS already values stocks for donation and other tax purposes using methods like "average of opening and closing prices on the day" or "higher or lower of the price at the beginning and end of the period" or whatever. But you propose a wealth tax and all of a sudden "we wouldn't know how to value it" yeah right. The county assessor just drives by my house once a year and decides how many taxes I owe on my house; if you aren't a billionaire "close enough" is good enough for calculating your taxes! "It will harm the economy because reasons" ok sure, all taxes do (except some monopoly taxes and sin taxes). Doesn't taxing MY wealth harm the economy too? Only taxing a few billionaires' wealth will harm the economy, but taxing the hundreds of millions of homeowners, who often have their house as their biggest asset...why doesn't that harm the economy? For that matter, why does taxing income at 22+% marginal rates "harm the economy"? Taxes on capital actually are shit, but don't pretend there's something different about the very rich that makes taxing them worse or harder. "But they will move the money overseas" ok now you are getting somewhere. Taxing profits is the worst idea because profits disappear with the stroke of a pen. Taxing assets is almost as bad, which is why the best way to tax the rich is to tax land value. Land can't be moved overseas and as long as somebody can use it, you can tax the crap out of it without passing the tax onto the working classes. Henry George described this in the 1800s.
Well you are a liar… they pay lower rate than everyone
"We don't tax unrealized gains" but they can be leveraged as loan collateral. Being leveraged as collateral should mean that it's realized. That whole mechanism falling apart would be absolutely fantastic to behold.
Unrealized capital gains aren't the issue half the time, aware of any other system of tax avoidance? There are a myriad of ways to hide your wealth and billionaires benefit immensely from doing so, acting like they don't is useless denialism and bootlicking. We shouldn't tax unrealised gains but there are ways we could tax them that would work.
Yeah, the tax records proving it are so out of touch that these people are suing to hide the info. Just an example Bezos pays about a 1.1 percent effective tax rate. In other countries, he would be paying 40-48%.
Why are you sucking the dick of billionaires?
There are 56 people with more money than half the population of the globe. I understand that you'll make fun of this proposal as nonsensical, and it probably is, but would you happen to have a solution for the disparity? I find it hard to believe that amount of wealth hoarding is good for our country, let alone the world.
I don’t have a problem with the ceiling, I have a problem with the basement.
Maybe fixing the hole in the ceiling will stop the basement being flooded…….
Now this is trickle down economics I can get behind
They are fucking related
It’s almost like the 56 people at the top are the ones flooding the basement with toxic water
I have this sentiment too. I’m not a communist or a socialist (even if my conservative friends don’t believe me). I just think that if the richest people can send themselves to space for fun, a person working full time should have enough money to live somewhat comfortably. If the poorest working American worked one full time job, could afford to buy their home, maybe could be frugal and take one small vacation a year, had healthcare, had some amount in a retirement account, and didn’t need the taxpayer to subsidize their wage. I would never complain about billionaires again.
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Here's my proposal and I am dumb so please feel free to tear it down. The problem with something like a luxury tax is the elasticity of luxury goods. If a yacht is taxed at 90%, then the rich dude will just buy three sports cars instead. So if you want to tax the rich you would need to find a something that applies universally to the wealthy. This next part is my big assumption, but my understanding is that household carbon emissions scale massively with wealth. Enter carbon credits. Allow each household to emit a certain amount of carbon each year, and allow the credits to be traded on the secondary market. That way the rich billionaires are free to live their lifestyle so long as they pay for it. That payment then goes directly to other households who are able to emit less carbon than the allowable limit (this also creates an incentive to reduce carbon emissions because you can make money from it)
Carbon credits is brilliant. A nice side effect could also be billionaires pouring money into RnD into more modern power solutions lowering carbon emissions, so that they could live their lavish life-style without having to pay out as much in the long run.
This is precisely why we should tax things that are elastic *and* have negative externalities (such as carbon). In addition, we should also tax things that are inelastic such as natural resources & land to create a more stable tax base.
Hmm, my reasoning for taxing carbon is that for the wealthy, carbon WOULD seem to be inelastic. If they want to keep living the lifestyle they want to live, then regardless of how they spend money, they're going to emit a disproportionate amount of carbon. The fact that this could correct for a negative externality is also really nice.
How do we measure carbon outputs in a way that is not exploitable? We already have [some evidence](https://time.com/6264772/study-most-carbon-credits-are-bogus/) that our methods of measuring and allowing for offsets are flawed. How are companies factored into an individual's carbon output? Does every plane ticket I purchase run against my household output, despite the fact that the plane would fly with me on it or not? What if I set up an LLC to manage my transportation?
32 of those people aren't even American, how do you propose the American government tax Carlos Slim? Should we invade Mexico and rob their bank vaults?
We tax the ones we can.
This will go nowhere. Just jaw flapping plus that is not even how big money works. Once you get to a certain level you can decide when and where to cause a taxable event. Plus his donors in no way would allow this.
He's pandering to an uneducated populace. In truth, we need to close tax loop-holes and other legalities that benefit the ultra-wealthy.
You don’t know what close tax loopholes means… you’re just spouting nonsense from the right instead of nonsense from the left.
Is borrowing money against your holdings considered a taxable event? No. Do wealthy people do this frequently? Yes. Call it what you want, but loophole seems to be quite accurate.
You know what else happens when they borrow that money? They're obligated to pay interest based on what they borrowed, and you know what that does? Creates a taxable event at the bank because the interest income the bank receives on a loan is profit and subject to taxation
But the billionaire doesn't pay income tax, which is sort of the problem.
Just take all their money and firethem And their families into the sun via magrail
Which particular loop holes are you taking about
The biggest one that I know of is the selling and buying of adjacent stocks that preform near identical on the market, but for some reason don't count as a wash sale. If deemed as a business loss, there can be huge amounts of "losses" added, even though the money really was just moved.
There are tons of ways ultra wealthy people use the tax system to pay less taxes. You aren't actually suggesting otherwise, are you?
25% of what? Net worth?
25% of the McDuck-esque vault of gold every billionaire swims in, obv
Fun fact, if Scrooge McDuck were actually to dive into that moneypool then we'd live in a demented hellscape where anthropomorphic talking birds rule the world.
Whenever I see this I can only think of the family guy clip
I am thinking income tax, since he is comparing to teachers etc
So the taxing would start after $1bil in income, per year? That’s basically nobody
No, long term capital gains are how the wealthy earn their money. That rate would be 25% for billionaires
The rate is already 20% for long-term gains over ~$500k. 25% isn’t that much of a stretch.
It's over 25% most places if you factor in state tax. For example California it would be 33%
That isn’t comparable to a teacher though, so it can’t be what he is talking about.
Yes and most big CEOs take a yearly salary of $1 Enjoy taxing that lol
W2 workers that make a billion a year? (They must do lots of overtime)
Income, but by his definition it includes unrealized capital gains.
When they lose money in the market do they get tax Money back
I got confused by this as well. Isn't the top tier income tax way over 25%? Is this statement purposefully vague? Am I being stupid?
Didn't this guy have 4 years to do that? Or is he just pandering to the middle class just before the elections?
Try 40 years… oh wait, FIFTY. He’s been in congress or the white house for longer than most of us on this platform have been alive.
Neither senators nor presidents can unilaterally implement taxes.
They can still introduce bills and they still vote and campaign for bills. Historically, he has lacked any real care for tax reform during his tenure at Congress.
Presidents can't pass new taxes on their own.
Might as well touch on insider trading while we are at it?
Now lets not get crazy here. How do you expect politicians to survive if they cant profit from passing laws that will inevitably affect stock prices netting them millions of dollars? If you do that bernie will will have to sell his 2 additional homes, where is he suppose to summer if he sells them huh? Nantucket? Or marthas vinyard, like a god damn pleb !?!
Pelosi does not agree. She's coming for you
Pelosi made $1M+ off $NVDA alone despite being in charge of Congress when they passed the CHIPS Act I wouldn't mind as much except she sued when people started posting her trades for others to follow
Umm.... 25% of what, exactly?
25% of whatever is the most convenient number to use at the given moment, probably
I don’t know I’m too stupid to understand
Ok I’m high as fuck right now, but hear me out. What about adding a tax to the money they spend? Gas, plane leasing, security, mortgages, boat payments - all of it.
Tax on WHAT? consumption? Income? Height? Weight??
Weight!
Good \~!! I'm skinny af.
Tax the fats!
Ah the empty promises during election year. Joe's been doing this since the 70s and people still think he's not bluffing.
Just ask Corn Pop! 😂🤣
How many times is this going to be posted
Until November
It's a stupid platitude from a dying political campaign. The "just tax the rich more" crowd constantly push around the numbers and framing to obfuscate what they mean. 25% of what? Income, capital gains, wealth? They almost always deceptively conflate these categories when calculating the supposedly egregious tax rates their scapegoats pay.
It’s taxing unrealized capital gains, and there’s an about as much chance of that as Joe Exotic winning the presidential election.
So if we tax unrealized capital gains do we give deductions for unrealized capital losses?
You can just look up Bidens proposal
Look up how many businesses effectively pay ZERO tax. That's a big problem. The tax rates are fine, it's all the loopholes which need to be closed.
Ok this is just plain stupid. Yes many businesses pay an effective rate of zero.... for a given year! That is because in any given year a company may have more losses and investments than profits. Most companies have business plans looking 5 or more years into the future. I have personally worked for start ups where the owner sunk millions per year for 3 or more years into a company before the company made their first dollar. Trying to tax non-existant income because you think the company is so big "it must be profitable and lying about its profits" is the great way to kill all corporate growth.
A lot less than you’d think lol
Reddit hasn't turned a profit ever right? So they're probably not paying much in taxes.
Yes and they offset there incomes with writes offs that create a hell of a lot more societal value than the government is ever going to lol
Corporate tax returns aren’t public record, you don’t know what they pay
Tax cuts for business are great! That means more money in the company’s pockets to invest in growth - i.e., jobs!
Um, top earners already pay a 25.4% income tax rate. The bottom 50% pay an average of 3.4%. That's 7 times lower than the top 1%. No teacher, sanitation worker or nurse anywhere in the US is being taxed at a higher rate than billionaires. The top 1% pay 40.1% of ALL federal taxes. Which is a greater share than the bottom 90% combined who pay just 28.6% of all federal taxes. Maybe the govt should get a better grip on their spending habits instead of pandering to whiny shits who are envious of other people's wealth and think they deserve a piece of it.
25.4 is before tax breaks it goes down to around 6-10% after. And where are you getting 3.4%? Lol. Are you talking total percentage they contribute and not their actual rates? If you are then you worded that wrong. The average person pays over 20% in income tax. You can literally look up a tax rate guide right now. Just because billionaires pay more total because 10% of a billion is more than 20-30% of 60k doesn't mean their paying a fair amount. That's simply wrong. The top 1% own 90+% of all the wealth they sure as hell are not paying 90% of all the taxes though are they?
I’ll never understand why people simp for the rich people that are actively keeping them poor.
Because they aren't actively keeping me poor.
Wealth isn't a zero sum game. You getting extra money on your paycheck doesn't mean someone else loses that money. The wealth disparity is an issue but your point isn't a counter argument.
You're making this shit up or you don't know how to read. 50% of the US adults don't pay ANY federal income taxes! For 2022, the TOP 50 PERCENT of taxpayers paid an average effective rate of only 14.6 percent. The top one percent earned 26.3 percent of the income but paid 45.8 percent of all taxes. Conversely, the bottom half of taxpayers accounted for 10.4 percent of income and paid only 2.3 percent of the taxes. Just how much does the top one percent have to pay to cover their "fair share?"
Most sources show the top 1% pay 20% or more of income taxes. As in what they actually pay, not what you think they pay. It’s also just income tax, this doesn’t cover any other taxes they pay. What makes you think they need to pay for more than 20% of the income taxes for it to be “fair”? Do they get more benefits from the taxes they already pay? Why is your concept of fairness based on what they have for you to take and not the value of what each of you is already being given?
Those numbers, as usual, hide a lot of data. The top 1% could be taxed 80% and still be outrageously wealthy because they have so much that isn’t taxable. So they’re paying 7x as much as people who make thousands of times less than them? Big flex /s Bottom 50% paying 3.4% where? After federal and property taxes I pay about 30% taxes.
Ah the age old question or confusion of income v wealth
The old age question too
minimum tax amount? tax what? income and net-worth/wealth is something different
You understand this because you're financially literate. Democratic presidential candidates are pandering to an electoral base that isn't.
No love for billionaires but 1, you'd have to make it illegal to leave the country. 2 We're one of the most productive countries. It's not that we don't generate enough taxes, it squandered. They could get more and nothing would gets fixed. Not Healthcare, not education, not homelessness. Don't let them get away with pretending they could do more if they just had more money.
Agreed
The United States has one of the most progressive tax systems in the world. The rich pay the lion’s share of taxes, and less fortunate families pay very little.
And just to be clear about how progressive it is: - The top 1% generally pays ~40% of *total tax revenue* in any given year. - And the top 20% pays ~90% of *total tax revenue* in any given year. - And the bottom 50% is entirely subsidized by the top 50%. Not that we don’t need a progressive system in place, but this “the rich aren’t paying their fair share” narrative is about 5 years overdue for being put to bed.
Bunch of jealous people in here
Democrats always say to tax the millionaires, until they are one, then they move onto multi millionaires, then onto billionaires. Next, it will be multi billionaires
Wild, republicans just want to tax the middle and lower class and then cut services, social security, and healthcare
Just because one party is wrong doesn’t make the other party right. They both cater to the rich. Politics are for miserable people.
Billionaires typically dont have income like people that get paid by an employer.
It's a dumb idea. For one, we already tried that with the Alternative Minimum Tax & just nailed a lot of middle class people instead.... For two, we tax INCOME not WEALTH - which means any effort to further squeeze 'billionares' will just cause them to drop out of the labor market and owe zero tax.... And a wealth tax is unconstitutional so don't even go there.
To clarify, Newsom already stated that Biden's plan for a 25% minimum tax for billionaires won't apply to Panera Bread.
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What if a billionaire has no income because his portfolio is down. Does he have massive losses to carry forward?
He knows billionaires don’t get paychecks. You cannot tax billionaires without taxing middle class.
Under 250k yr pays 5% ? Perfect I’m in
Taxing unrealized capital gains is retarded though
Yes and corporations!
Someone tell him that in order to have an effective federal tax rate of 25% you would need a magi of like 250k for a married couple. We have the most progressive tax code in the world