6 ms·

This is predicated on the idea that the rich will pay their taxes if we just close all the loopholes. If you polled the top brackets I think you'll find that t

by cwhiz 6y ago

This is predicated on the idea that the rich will pay their taxes if we just close all the loopholes. If you polled the top brackets I think you'll find that they are more than happy to continue with our current tax system.

solosoyokaze 6y ago
Are you suggesting that the rich would break the law and engage in tax evasion (not legal loopholes)? A great portion of my taxes goes to military and police. Wouldn’t they just collect the money push come to shove? They certainly have the capability, but possibly not the will.
- g00gler 6y ago
  It’s relatively easy to pay less taxes than your true compensation once you get past the rank-and-file level of employment. As income taxes rise there’s a clear pattern of altered compensation like stock grants, expense accounts, etc. For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes. Instead of giving you $40,000 in cash which would cost 30% in FICA between you and the company plus personal income tax to you, you can live in a nice $3500/mo apartment you would otherwise be paying for in after tax dollars. Instead of you paying $800/month+ for a Tesla model X lease with your after tax dollars the company can pay for it, write it off, and again they’re saving 15% on taxes and you’re saving > 40% on that $10,000 and pocketing more of your after tax income.
  - sneeze-slayer 6y ago
    Other countries solve this by taxing it as a "benefit in kind". It is compensation, and should be included in how one is taxed.
    - filoleg 6y ago
      It is a thing in the US too. For example, I have to pay income tax on the annual "fitness reimbursement allowance" the company provides for us. Very simplified version: we can spend up to $1k/yr on fitness related expenses and get them reimbursement. We submit a reimbursement request, and if it gets approved, I get the money back in my account. The HR page explicitly warns that any reimbursement received will count towards your income tax.
  - solosoyokaze 6y ago
    I don't think you can tax the rich with income tax, for the reason you state. I think you need a wealth tax.
  - gruez 6y ago
    >For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes. I'm not an accountant or a tax lawyer, but it doesn't look like that's the case according to the IRS's website. Housing is only exempt if it's "Lodging on your business premises"[1]. A tesla would also likely not be exempt for a typical office worker[2] [1] https://www.irs.gov/publications/p15b#en_US_2021_publink1000193639 https://www.irs.gov/publications/p15b#en_US_2021_publink1000... [2] https://www.irs.gov/publications/p15b#en_US_2021_publink1000193758 https://www.irs.gov/publications/p15b#en_US_2021_publink1000...

by cwhiz 6y ago

solosoyokaze 6y ago

Are you suggesting that the rich would break the law and engage in tax evasion (not legal loopholes)? A great portion of my taxes goes to military and police. Wouldn’t they just collect the money push come to shove? They certainly have the capability, but possibly not the will.

g00gler 6y ago
It’s relatively easy to pay less taxes than your true compensation once you get past the rank-and-file level of employment. As income taxes rise there’s a clear pattern of altered compensation like stock grants, expense accounts, etc. For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes. Instead of giving you $40,000 in cash which would cost 30% in FICA between you and the company plus personal income tax to you, you can live in a nice $3500/mo apartment you would otherwise be paying for in after tax dollars. Instead of you paying $800/month+ for a Tesla model X lease with your after tax dollars the company can pay for it, write it off, and again they’re saving 15% on taxes and you’re saving > 40% on that $10,000 and pocketing more of your after tax income.
- sneeze-slayer 6y ago
  Other countries solve this by taxing it as a "benefit in kind". It is compensation, and should be included in how one is taxed.
  - filoleg 6y ago
    It is a thing in the US too. For example, I have to pay income tax on the annual "fitness reimbursement allowance" the company provides for us. Very simplified version: we can spend up to $1k/yr on fitness related expenses and get them reimbursement. We submit a reimbursement request, and if it gets approved, I get the money back in my account. The HR page explicitly warns that any reimbursement received will count towards your income tax.
- solosoyokaze 6y ago
  I don't think you can tax the rich with income tax, for the reason you state. I think you need a wealth tax.
- gruez 6y ago
  >For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes. I'm not an accountant or a tax lawyer, but it doesn't look like that's the case according to the IRS's website. Housing is only exempt if it's "Lodging on your business premises"[1]. A tesla would also likely not be exempt for a typical office worker[2] [1] https://www.irs.gov/publications/p15b#en_US_2021_publink1000193639 https://www.irs.gov/publications/p15b#en_US_2021_publink1000... [2] https://www.irs.gov/publications/p15b#en_US_2021_publink1000193758 https://www.irs.gov/publications/p15b#en_US_2021_publink1000...