4 ms·
> Could you explain the rationale for excluding such unearned income, other than privileging generational wealth against wealth earned by personal work and inve
by isostatic 8y ago
> Could you explain the rationale for excluding such unearned income, other than privileging generational wealth against wealth earned by personal work and investment?
If I buy a round of drinks, do people have to pay tax?
(I assume there's some minimum threshold)
- mmcconnell1618 8y agoI'm fairly certain the United States Internal Revenue Service would consider the drinks received by others as income they should technically report on their taxes. For practical purposes, I suspect that almost no one ever does report this type of gift, but yes, technically it would qualify. If I give someone $5 for their birthday, they should report it but won't. If I give them $50,000 for their birthday, they better report it or risk the IRS finding out and coming after them.
- JoeAltmaier 8y agoGifts < $14K not necessary to report
- dragonwriter 8y ago> If I buy a round of drinks, do people have to pay tax? Ideally, probably, but even in a system which tries to mitigate the advantage of generational wealth created by the current favorable regime of gift and inheritance tax by a purer income tax, the friction of taxing de minimis personal gifts as income to recipients is something you probably want to avoid.
- vvillena 8y agoThey don't, because you do. That's sales tax at work. Taxes are usually paid each time money moves hands.
- TheCoelacanth 8y agoIf you bought a round of Dalmore 62, then yes, otherwise, no because only gifts of more than $15k per year per person incur the gift tax (and technically, you would pay the tax, because the tax is on the giver and not on the recipient).