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If IP and shell companies infuriate you. I invite you to investigate why all billionaires have foundations or its cousin structures and "give" their wealth to i

If IP and shell companies infuriate you. I invite you to investigate why all billionaires have foundations or its cousin structures and "give" their wealth to it... Clue: tax and inheritance (tax) avoidance. Bill, Buffett, etc. are hypocrites. But it is not new, even in the Bible they spoke about it (Matthew 6:2): "So when you give to the needy, do not announce it with trumpets, as the hypocrites do in the synagogues and on the streets, to be honored by men."

thisCtx 5y ago
IMO most of the “exceptional” people in a country “by of and for the people” are hypocrites for waiting on billionaires to fix things How is political capitulation by the masses exceptional? Covid offered a perfect opportunity for info workers to show solidarity with on-site workers by not opening those laptops at home. But really it’s the leopards fault they keep eating our faces because we refuse to build a cage (higher taxation, breaking up monopoly). The solution is not new either as we just went through it in recent memory with ATT. I’m rather tired of the general public pointing fingers at everyone but themselves. Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it.
- rjbwork 5y ago
  >Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it. A general strike? You're asking for people to cooperate in a mass prisoner dilemma on a societal scale. Never going to happen with the complete lack of labor organization in the US.
  - lumost 5y ago
    General strikes occur are strange occurences. The few examples such as France in 1968, or the Soviet Union in 1991, or the Praque Spring in 1968 occurred for reasons more akin to "mass social unrest/dissatisfaction" than organized labor activity.
gogopuppygogo 5y ago
Anyone with any money should setup a trust. Especially if they want to marry. Done right it’s an amazing way to protect your wealth. Better protection than a prenup can provide.
- deleted 5y ago
  [deleted]
- ur-whale 5y ago
  >Anyone with any money should setup a trust Anyone in the US with any money should setup a trust
- kube-system 5y ago
  Where can I read more?
thrwn_frthr_awy 5y ago
How would someone at that level of wealth give in a more empathetic way? What should Bill and Buffett be doing instead?
- IdontRememberIt 5y ago
  Buffett always complains that he did not pay enough tax. He could simply wire 50% of his fortune to the IRS. His secretary had no choice. (End of sarcasm) They should donate to a foundation. They should not have link with it (direct or indirect). Their family (direct or indirect) should not have link with it (direct or indirect). The problem with these structures is that they allow someone to control and directly benefit from assets without fiscally owning them. Usually these foundations have complex structures and use generous fiscal code of some countries. For many, the main goal is to lower the fiscal pressure during transmission to the children.
  - paulpauper 5y ago
    millions of Americans struggle with basic expenses. Such expenses are recurring. even if he gave half, it would not last long enough to fix those problems.
    - boringg 5y ago
      Agree - which is why he says it's a systemic problem that needs fixing. All of these, frankly, stupid arguments that he should just give the IRS money for no reason because they don't tax him high enough is ridiculous. Literally a drop in the bucket. Full year budget - $4.89 Trillion in 2019.
  - dnautics 5y ago
    I think the real thing is that Buffet knows that wiring your fortune to the IRS is a perilously stupid way to do good with your money; just statistically such a huge chunk of that will go to, say, bombing children halfway around the world, bureaucracies that spend money better than actually provide healthcare, and anti-poverty programs that are better at lining the pockets of 'social entrepreneurs' that are better at writing grants than providing services to the poor. If you do actually believe that the federal government is the most efficient way to redistribute wealth, at least earmark it to killing the debt, which is an unethical institution (you cannot go back in time and vote against spending that your generation is forced to pay off; it's taxation without representation) https://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm https://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm
dheera 5y ago
Can someone create a Dutch-shell-companies-as-as-service (DSCaaS), generate and submit all legal documents automatically, and help normal citizens dodge the same amount of taxes?
- IdontRememberIt 5y ago
  Forget it. Tax offices are chasing the big fishes so they have all the tools to catch and bother the small inexperienced ones. Also running these structure is actually very expensive and complex. Normal citizen have only 2 possibilities: cash economy or move to place fiscally more adapted to their needs (each country favor a type of fiscal profil).
- ev1 5y ago
  I was actually offered this as a service by a company doing formations in the Seychelles (they were spamming people) - quite literally had a spammer tell me "no, don't buy my product, it isn't worth it" They basically said the cost of company formation (doesn't really matter where, but anywhere that matters, like Panama or Seychelles or BVI or Macau or etc), mail handling monthly payments, virtual office payments, legal and accountant time, etc exceeds more than 99% of peoples' actual tax payment. That includes people making 500k. And that there is virtually no point in doing so. Doubly more if you are US based due to reporting requirements and massive additional costs for that. IANAL, but based on what I've been told you are not able to easily do this if you are employed by a normal company - it requires that you hold a company in the first place to have intellectual property, branding to be able to licence cross-shell [easiest compared to trying to shuffle physical items of value around], etc, and that the company gets the payment, so people making 500k FAANG salaries are out as they are FTE employed. And that your cost of finding the 'correct' accountant that has experience in this will far exceed your previous accountant cost.
- varenc 5y ago
  I suspect there's a large fixed cost to arrange this so it doesn't make sense for most people. Though maybe there's way to make it cheaper! Also with inheritance tax in the US, your estate isn't taxed unless it's worth more than $11.18 million [0]. So doesn't matter for most people. It's estimated only %0.2 of estates pay the tax. [0] https://en.wikipedia.org/wiki/Estate_tax_in_the_United_States https://en.wikipedia.org/wiki/Estate_tax_in_the_United_State...
dariusj18 5y ago
Yes and no, in the case of charities, our tax system encourages this behavior intentionally. Obviously there are those who take advantage more than others, but often you would find that it's not easy to do so without actually breaking the law.
UI_at_80x24 5y ago
Your point is valid without the need to reference fiction. Please don't pollute HN with this rhetoric.
- tryonenow 5y ago
  You don't need to be religious to recognize that there is occasional wisdom in the bible.
lifeformed 5y ago
You could reframe it as: The tax benefits are there to incentivize philanthropic giving. Society benefits from their giving and they receive a tax benefit and PR boost in return. It's not like they're saving more money total by giving it away. And sure, it'd be nice if philanthropists were super humble and anonymous, but the money helps either way, and I don't think those who are helped by the giving care if the givers have a statue of themselves up somewhere.
- IdontRememberIt 5y ago
  It is a tool, you are right. But not the solution so it should not be so heavily encourage. What should be encourage: a better distribution of the profits in the value production chain. At amazon, Wallmart, all the employees should be obscenely well paid (relatively to their job), the enormous profits should not be concentrated at the top.
- lumost 5y ago
  The core claim above is that ultimately the foundation is a lip service activity to preserve wealth. If a hundred billionaire pays out 1 billion dollars in philanthropy via the foundation, but earns 10 billion tax free then they are doing quite well. It's a trivial matter to write the terms of the foundation such that yourself/successors can draw permanent income via "board" positions, advisory roles, or other means.
  - shostack 5y ago
    How would that work exactly? Genuine question, I've never understood how donating saves on taxes, you have to pay at some point to access the money, no?
    - deleted 5y ago
      [deleted]
    - staplers 5y ago
      I think the idea is that you "pay" the charity instead of the tax man. This in turn allows you to take income from the charity (as an advisor/board member/fake title) so you're getting some back (with 40% taxed as income) via charity "employment". Then as a cherry on top, you get to push headlines that you are altruistic and have buildings named after you. Also, your friends can be advisors/board members for your charity and donate you gifts.

thisCtx 5y ago

IMO most of the “exceptional” people in a country “by of and for the people” are hypocrites for waiting on billionaires to fix things How is political capitulation by the masses exceptional? Covid offered a perfect opportunity for info workers to show solidarity with on-site workers by not opening those laptops at home. But really it’s the leopards fault they keep eating our faces because we refuse to build a cage (higher taxation, breaking up monopoly). The solution is not new either as we just went through it in recent memory with ATT. I’m rather tired of the general public pointing fingers at everyone but themselves. Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it.

rjbwork 5y ago
>Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it. A general strike? You're asking for people to cooperate in a mass prisoner dilemma on a societal scale. Never going to happen with the complete lack of labor organization in the US.
- lumost 5y ago
  General strikes occur are strange occurences. The few examples such as France in 1968, or the Soviet Union in 1991, or the Praque Spring in 1968 occurred for reasons more akin to "mass social unrest/dissatisfaction" than organized labor activity.

gogopuppygogo 5y ago

Anyone with any money should setup a trust. Especially if they want to marry. Done right it’s an amazing way to protect your wealth. Better protection than a prenup can provide.

deleted 5y ago
[deleted]
ur-whale 5y ago
>Anyone with any money should setup a trust Anyone in the US with any money should setup a trust
kube-system 5y ago
Where can I read more?

thrwn_frthr_awy 5y ago

How would someone at that level of wealth give in a more empathetic way? What should Bill and Buffett be doing instead?

IdontRememberIt 5y ago
Buffett always complains that he did not pay enough tax. He could simply wire 50% of his fortune to the IRS. His secretary had no choice. (End of sarcasm) They should donate to a foundation. They should not have link with it (direct or indirect). Their family (direct or indirect) should not have link with it (direct or indirect). The problem with these structures is that they allow someone to control and directly benefit from assets without fiscally owning them. Usually these foundations have complex structures and use generous fiscal code of some countries. For many, the main goal is to lower the fiscal pressure during transmission to the children.
- paulpauper 5y ago
  millions of Americans struggle with basic expenses. Such expenses are recurring. even if he gave half, it would not last long enough to fix those problems.
  - boringg 5y ago
    Agree - which is why he says it's a systemic problem that needs fixing. All of these, frankly, stupid arguments that he should just give the IRS money for no reason because they don't tax him high enough is ridiculous. Literally a drop in the bucket. Full year budget - $4.89 Trillion in 2019.
- dnautics 5y ago
  I think the real thing is that Buffet knows that wiring your fortune to the IRS is a perilously stupid way to do good with your money; just statistically such a huge chunk of that will go to, say, bombing children halfway around the world, bureaucracies that spend money better than actually provide healthcare, and anti-poverty programs that are better at lining the pockets of 'social entrepreneurs' that are better at writing grants than providing services to the poor. If you do actually believe that the federal government is the most efficient way to redistribute wealth, at least earmark it to killing the debt, which is an unethical institution (you cannot go back in time and vote against spending that your generation is forced to pay off; it's taxation without representation) https://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm https://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm

dheera 5y ago

Can someone create a Dutch-shell-companies-as-as-service (DSCaaS), generate and submit all legal documents automatically, and help normal citizens dodge the same amount of taxes?

IdontRememberIt 5y ago
Forget it. Tax offices are chasing the big fishes so they have all the tools to catch and bother the small inexperienced ones. Also running these structure is actually very expensive and complex. Normal citizen have only 2 possibilities: cash economy or move to place fiscally more adapted to their needs (each country favor a type of fiscal profil).
ev1 5y ago
I was actually offered this as a service by a company doing formations in the Seychelles (they were spamming people) - quite literally had a spammer tell me "no, don't buy my product, it isn't worth it" They basically said the cost of company formation (doesn't really matter where, but anywhere that matters, like Panama or Seychelles or BVI or Macau or etc), mail handling monthly payments, virtual office payments, legal and accountant time, etc exceeds more than 99% of peoples' actual tax payment. That includes people making 500k. And that there is virtually no point in doing so. Doubly more if you are US based due to reporting requirements and massive additional costs for that. IANAL, but based on what I've been told you are not able to easily do this if you are employed by a normal company - it requires that you hold a company in the first place to have intellectual property, branding to be able to licence cross-shell [easiest compared to trying to shuffle physical items of value around], etc, and that the company gets the payment, so people making 500k FAANG salaries are out as they are FTE employed. And that your cost of finding the 'correct' accountant that has experience in this will far exceed your previous accountant cost.
varenc 5y ago
I suspect there's a large fixed cost to arrange this so it doesn't make sense for most people. Though maybe there's way to make it cheaper! Also with inheritance tax in the US, your estate isn't taxed unless it's worth more than $11.18 million [0]. So doesn't matter for most people. It's estimated only %0.2 of estates pay the tax. [0] https://en.wikipedia.org/wiki/Estate_tax_in_the_United_States https://en.wikipedia.org/wiki/Estate_tax_in_the_United_State...

dariusj18 5y ago

Yes and no, in the case of charities, our tax system encourages this behavior intentionally. Obviously there are those who take advantage more than others, but often you would find that it's not easy to do so without actually breaking the law.

UI_at_80x24 5y ago

Your point is valid without the need to reference fiction. Please don't pollute HN with this rhetoric.

tryonenow 5y ago
You don't need to be religious to recognize that there is occasional wisdom in the bible.

lifeformed 5y ago

You could reframe it as: The tax benefits are there to incentivize philanthropic giving. Society benefits from their giving and they receive a tax benefit and PR boost in return. It's not like they're saving more money total by giving it away. And sure, it'd be nice if philanthropists were super humble and anonymous, but the money helps either way, and I don't think those who are helped by the giving care if the givers have a statue of themselves up somewhere.

IdontRememberIt 5y ago
It is a tool, you are right. But not the solution so it should not be so heavily encourage. What should be encourage: a better distribution of the profits in the value production chain. At amazon, Wallmart, all the employees should be obscenely well paid (relatively to their job), the enormous profits should not be concentrated at the top.
lumost 5y ago
The core claim above is that ultimately the foundation is a lip service activity to preserve wealth. If a hundred billionaire pays out 1 billion dollars in philanthropy via the foundation, but earns 10 billion tax free then they are doing quite well. It's a trivial matter to write the terms of the foundation such that yourself/successors can draw permanent income via "board" positions, advisory roles, or other means.
- shostack 5y ago
  How would that work exactly? Genuine question, I've never understood how donating saves on taxes, you have to pay at some point to access the money, no?
  - deleted 5y ago
    [deleted]
  - staplers 5y ago
    I think the idea is that you "pay" the charity instead of the tax man. This in turn allows you to take income from the charity (as an advisor/board member/fake title) so you're getting some back (with 40% taxed as income) via charity "employment". Then as a cherry on top, you get to push headlines that you are altruistic and have buildings named after you. Also, your friends can be advisors/board members for your charity and donate you gifts.