Jump to content
OILERMAN

The tax windfall that wasn't: A troubling new IRS report suggests many Americans may be giving money right back to the government

Recommended Posts

10 minutes ago, OILERMAN said:

Yea Starkiller mentioned this a few times. It's a simple fix that would add a ton to revenue. 

 

Make Capital gains taxed at ordinary income rates

You can’t do that because the billionaires who already have massive amounts of their wealth in tax havens might leave the most stable market in the world. 

Share this post


Link to post
Share on other sites
Justafan   
19 minutes ago, OILERMAN said:

Yea Starkiller mentioned this a few times. It's a simple fix that would add a ton to revenue. 

 

Make Capital gains taxed at ordinary income rates

I'm not huge on it because I have a large brokerage account myself but it probably is the best way to actually tax the rich who make far more off their investments than they do an actual "income".  People making millions of dollars rarely work for someone else.  They own the company or can be compensated in ways other than a salary.  The government needs to get creative to keep up with their creativity at dodging taxes.

 

To complicate matters, the Republicans have completely gutted the IRS so whatever measures that are currently on the books are difficult to enforce.

Share this post


Link to post
Share on other sites
OILERMAN   
30 minutes ago, IsntLifeFunny said:

You can’t do that because the billionaires who already have massive amounts of their wealth in tax havens might leave the most stable market in the world. 

You don't need a "tax haven" to get capital gains income, just stocks and real estate generate it. And I don't think people liquidate and move from the US market, to where?

 

Obama already raised it from 15% to 20% for people making over 400k and they then added another 3% to later pay for Obamacare.

 

It was anywhere from 28-35% 40s- 2000

Share this post


Link to post
Share on other sites
32 minutes ago, IsntLifeFunny said:

You can’t do that because the billionaires who already have massive amounts of their wealth in tax havens might leave the most stable market in the world. 

Rich people will hide their income regardless. But the wealthy make a greater percentage of their income from capital gains than they do normal income. There’s no reason to tax it differently in most cases. 

Share this post


Link to post
Share on other sites
24 minutes ago, Justafan said:

I'm not huge on it because I have a large brokerage account myself but

Unless you are making hundreds of thousands a year in profit off the stock market it wouldn’t really affect your taxes bill much. 

Share this post


Link to post
Share on other sites
Justafan   
Just now, Starkiller said:

Unless you are making hundreds of thousands a year in profit off the stock market it wouldn’t really affect your taxes bill much. 

It would make stock investing unprofitable for anyone investing outside of a tax-sheltered account.  

 

A good return is 11% averaged out over the long term.  Probably less.  Then inflation.  15% of your profits from that margin are already taxed.  Increasing that greatly reduces the eventual profit I can make on my brokerage account without reducing the risk.

 

All of a sudden real estate or other investments become much more attractive not just to me but also rich investors.  That lack of investment would greatly hurt the stock market which would have secondary and tertiary effects.

 

It's an idea and there's a bunch of smart people out there.  I don't know everything and I'm certainly open to creative ideas as I pointed out but this one I oppose for my own (admittedly) selfish reasons if nothing else. 

Share this post


Link to post
Share on other sites
9 Nines   

The main driver, for reduced  taxes, is carried interest:  https://www.investopedia.com/terms/c/carriedinterest.asp

 

Much of the management fee, that general partners take, is carried interest. Carried interest is taxed at capital gain rates.  Traditionally this is hedge fund and fund managers etc. "salaries."  Of late, more and more large corporations are becoming general partners, forming some of their operating units into partnerships, thereby, shifting the profits from those operating units into carried interest to avoid taxes.

 

There has been a drive by responsible political groups to close that loophole, but as you might have guessed, republicans have aimed at expanding it, which they did in the latest tax bill. 

Edited by 9 Nines

Share this post


Link to post
Share on other sites
9 Nines   
16 minutes ago, Starkiller said:

 There’s no reason to tax it differently in most cases. 

I think it should be taxed more.  People actually working to earn money should pay less of percentage than someone taking passive income.  To allow for average Americans to invest/save, you could have a threshold, where it is treated favorable up to that point but someone making several $100s of thousands of dollars or more passively should pay the highest rate.  They are not receiving that income for doing anything productive for the economy and in the larger cases, some are counter-productive  - "economic rents", creating situations where a non competitive market place is charging higher prices from the concentrated ownership.  I.e., the classic rentier class*.

 

 

*Rentier capitalism. Rentier capitalism is used to describe the belief in economic practices of monopolization of access to any (physical,financial, intellectual, etc.) kind of property, and gaining significant amounts of profit without contribution to society. 

Edited by 9 Nines

Share this post


Link to post
Share on other sites
3 minutes ago, Justafan said:

It would make stock investing unprofitable for anyone investing outside of a tax-sheltered account.  

 

A good return is 11% averaged out over the long term.  Probably less.  Then inflation.  15% of your profits from that margin are already taxed.  Increasing that greatly reduces the eventual profit I can make on my brokerage account without reducing the risk.

You are talking about a pretty small drop in profit. For most people, the difference between the capital gains rate and the regular income tax rate is pretty minimal. Only the wealthy would see any significant difference. 

 

It’s only a big difference for millionaires and billionaires who make most of their income off the stock market. 

Share this post


Link to post
Share on other sites
17 minutes ago, OILERMAN said:

You don't need a "tax haven" to get capital gains income, just stocks and real estate generate it. And I don't think people liquidate and move from the US market, to where?

 

Obama already raised it from 15% to 20% for people making over 400k and they then added another 3% to later pay for Obamacare.

 

It was anywhere from 28-35% 40s- 2000

I was joking. 

Share this post


Link to post
Share on other sites
Justafan   
20 minutes ago, OILERMAN said:

You don't need a "tax haven" to get capital gains income, just stocks and real estate generate it. And I don't think people liquidate and move from the US market, to where?

 

Obama already raised it from 15% to 20% for people making over 400k and they then added another 3% to later pay for Obamacare.

 

It was anywhere from 28-35% 40s- 2000

This is a better idea in my opinion.  Raise it for people who have over a certain percentage of their income from stocks alone.  Maybe even lower the current rate for small investors to encourage regular people to invest.

Share this post


Link to post
Share on other sites
9 Nines   

Look at Howard Schultz, he made billions littering every urban and suburban corner with  half nude mermaids shops, selling high calorie, dairy-fat and sugar drinks with burnt coffee. In a way, you could look at him as a drug pusher.   Now he wants to cut Medicare and Social Security so he and his friends can keep all of it. 

Edited by 9 Nines

Share this post


Link to post
Share on other sites
OILERMAN   
13 minutes ago, Justafan said:

This is a better idea in my opinion.  Raise it for people who have over a certain percentage of their income from stocks alone.  Maybe even lower the current rate for small investors to encourage regular people to invest.

Married couples making 76k or less are taxed at 0% for capital gains, from 77 -460K it's 15% and 20% above that

Share this post


Link to post
Share on other sites
Justafan   
3 minutes ago, OILERMAN said:

Married couples making 76k or less are taxed at 0% for capital gains, from 77 -460K it's 15% and 20% above that

Ah.  I didn't realize it was 0 for people making under a certain amount.  People really are stupid, taking free money and instead throwing it at cars they can't afford.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Recently Browsing   0 members

    No registered users viewing this page.

×
×
  • Create New...