12 ms·

Tax details of US super-rich allegedly leaked

75 points by boto3 5y ago

boto3 5y ago
The referred ProPublica article has a lot more details: https://www.propublica.org/article/the-secret-irs-files-trove-of-never-before-seen-records-reveal-how-the-wealthiest-avoid-income-tax https://www.propublica.org/article/the-secret-irs-files-trov...
- danbrooks 5y ago
  Agreed, the ProPublica article is quite precise and consistent.
vinni2 5y ago
I wonder what people think of Norwegian system where everyone’s tax information is public. https://www.forbes.com/sites/davidnikel/2020/09/04/in-norway-tax-returns-are-a-matter-of-public-record/amp/ https://www.forbes.com/sites/davidnikel/2020/09/04/in-norway...
- emc3 5y ago
  That question was asked in a thread on the same topic earlier today: https://news.ycombinator.com/item?id=27434929 https://news.ycombinator.com/item?id=27434929
- yupper32 5y ago
  Sounds horrible. I don't want people outside of my tech circle knowing how much money I make. I like my privacy. Having people know I make over $x00k a year would invite all sorts of bad things.
- cheriot 5y ago
  A middle ground might be public tax info for the richest 100 people. Most of them are verifying their wealth for Forbes and Bloomberg rich lists anyway.
cheriot 5y ago
> The website alleges That's an unfortunately dismissive way to refer to ProPublica. They're more accomplished than most news rooms: https://en.wikipedia.org/wiki/ProPublica#Awards https://en.wikipedia.org/wiki/ProPublica#Awards
- chabons 5y ago
  From the article: "[...] the BBC has not been able to confirm the claims, [...]" I don't see a problem with the word "alleges" in this context, regardless of the pedigree of the publication.
- handrous 5y ago
  Dismissive? It's factual. As in, "the prosecution alleges..."
  - nextstep 5y ago
    I think the parent comment was referring to the characterization of ProPublica as just a “website”.
01100011 5y ago
I've seen people complaining that the article is disingenuous because it conflates income taxes with capital gains taxes. My response is 'so what'. When you make above a certain income level, you don't need anymore income and can play around with reinvesting capital gains to push taxes into the future while amassing wealth. Sure, you're not realizing the income, but what you're doing, I think, is gaining power and influence. To me, it makes some sense to tax capital gains the same as income, at least above a certain amount.
- arn 5y ago
  It conflates income with unrealized capital gains. You can make an argument that income and capital gains should be taxed at similar rates, but it feels like they are being purposely misleading in their presentation, when they use unrealized capital gains as the denominator. No one else’s taxes are viewed through that lens.
  - zorak8me 5y ago
    I am confused. They were clearly discussing unrealized gains as wealth throughout the article. What am I missing here?
    - lotsofpulp 5y ago
      Look at this sentence in the Propublica article: > No one among the 25 wealthiest avoided as much tax as Buffett, the grandfatherly centibillionaire. That’s perhaps surprising, given his public stance as an advocate of higher taxes for the rich. It is clickbait, emotion inducing garbage. Buffett’s stance for higher taxes has nothing to do with the fact that he had less income than other rich people. I expected better from ProPublica. Arguing for taxing unrealized gains is fine, but trying to make it seem like Buffett is doing something sneaky to churn emotions is bullshit writing.
      - zorak8me 5y ago
        It certainly seems to have elicited emotions from some readers.
shoto_io 5y ago
"Don't hate the player hate the game," is what comes to my mind. I would guess it's all legal. It is still good to have transparency, which might potentially change things. I am not so sure though. After all, politicans are usually rich as well. But: All of these super-rich have probably created many, many jobs. I guess all-in-all it is a positive game for society.
- vkou 5y ago
  > I would guess it's all legal. When it's all secret, we can't make an informed decision on whether or not it should be legal.
  - imgabe 5y ago
    Publicly release your own tax return first then. Be the change you want to see.
    - vkou 5y ago
      Nothing interesting in them. Wage income, standard deductions, some realized cap losses from a few stock sales. Looks like any other tax return. What bit of information do you expect that tax return add to the conversation of "Are the rich evading taxes?"
      - imgabe 5y ago
        We have a whole section of the government dedicated to figuring out whether people are evading taxes and then pursuing them for it. It could use some more funding, but that’s the appropriate way to do it. What are you going to add by having uninformed members of the public inspecting tax returns they don’t understand? Keep in mind there are people who turn down raises because they think being in a higher tax bracket will cause them to lose money. These are the geniuses you want to catch tax evaders?
        vkou 5y ago
aaronschroeder 5y ago
But what is the solution? Most wealth of people like Elon Musk and Jeff Bezos is tied to ownership shares in their companies. I don't think it's fair to force them to sell shares so they can cover higher taxes. I also fear efforts to extract more tax money from them will ultimately just raise the bill for the middle class. The ultra wealthy can afford to hire a team of accountants to find the loopholes while small businesses are stuck with higher corporate tax rates.
- frankbreetz 5y ago
  The simple solution is to close the loopholes. Complexity is a tax on the middle class
- mupuff1234 5y ago
  Why is it not fair to force them? I don't think it's any more or less fair than forcing people to pay income tax.
  - robryan 5y ago
    There may be unintended consequences in forcing successful founders to over time sell down a controlling stake in their company.
    - idiotsecant 5y ago
      This is like saying that homeowners are being forced to sell their homes over time to pay for property tax.
      - aaronschroeder 5y ago
        Some are. We live in an area where annual taxes are about 2% the value of the home. Home values have been skyrocketing and taxes along with them. Some people on fixed incomes can't afford it so are forced to sell. I think property tax should be abolished in general, but the problem with taxing ownership of a company is that owners are then forced to spend that much less on expenses to cover their tax burden (fewer jobs, or lower salaries for employees). A lot of companies operate close to break-even or even at a loss. What happens with the owner of a $2m / year company must come up with a 10% wealth tax amounting to $200k, but the company is operating at break-even? Expenses must be cut to pay the tax. Ultimately hurts the lower and middle class the most.
whoisburbansky 5y ago
How does tax treatment on loans taken out using unrealized capital gains as collateral work? In particular, has anybody here taken loans out on unvested RSUs?
- paulpauper 5y ago
  it's not income so it's not taxable
sec400 5y ago
If anyone understands the reasoning behind the US capping your deductible net capital loss in any tax year at $3,000 vs allowing your full capital losses to be offset I'd be interested.
- marsrover 5y ago
  Because the country is fundamentally broken.
  - JumpCrisscross 5y ago
    > the country is fundamentally broken As in people ascribe ongoing debates to the system being broken, yes. Literally in this thread we have good arguments for reducing capital gains tax exclusions and special treatments and arguments for.
    - marsrover 5y ago
      Make all the good arguments you want, won't change anything.
- tldrthelaw 5y ago
  One big reason is to push "people" that are basically engaging in a trade or business in to being a formal business, and taking the losses as business losses.
- spikels 5y ago
  Idea is to prevent people from offsetting large incomes with capital losses. This simply appears unfair to many - earning lots of income but paying little tax. A more sophisticated argument is that since you can control capital losses by choosing which assets to sell you would be able to manage your taxes. With enough assets and some planning you could never pay taxes despite having a large income. The $3,000 cap prevents this. Similar approaches are used throughout the tax code to prevent abuses.
christkv 5y ago
Wealth tax is one possible solution and one that is used by at least some European countries.
cronin101 5y ago
It's bizarre to see the federal outcry here since in Norway, everyone's tax return is "public". (You can request to see anybody's but they do get a notification that you viewed it. It was anonymous until recently) It's hard to argue against sunlight being the best disinfectant.
- boomboomsubban 5y ago
  Is republishing it illegal? That system seems like it'd immediately have some outlet request to see everybody's tax return and reprint it to recover the anonymity.
perfunctory 5y ago
Thomas Piketty proposes a progressive annual global wealth tax of up to 2%. I think it's a good idea.
- large 5y ago
  I would be in favor of that if it came with the elimination of all other taxes
atlgator 5y ago
As others have stated, the article conflates income taxes with capital gains taxes. It also conflates asset ownership with income. Saying someone is "worth" a certain amount simply because they have a large stake in a corporation is an oversimplification. What they really own are illiquid assets, intellectual property, etc. Put to use, they produce income for the corporation as well as it's shareholders and employees, all of which are taxed in various ways and various levels.
- gigel82 5y ago
  You mean shareholders, not employees.
  - atlgator 5y ago
    Shareholders and employees. Where do you think salaries come from? If employees could generate income in isolation they wouldn't need jobs would they? The assets of a company are a shared resource that benefit everyone involved with the company as well as the supply chain. Does it benefit shareholders more? Yes. Should tax loopholes be closed? Yes.
    - gigel82 5y ago
      That stopped being true sometime in the early '70s unfortunately: https://archive.is/Ouf6d https://archive.is/Ouf6d
tldrthelaw 5y ago
It isn't the fault of the driver that drives 100 mph nearly as much as it is the society that sets the speed limit to 110. No fan of the billionaires, but they're just following the code. None of these things are "loopholes" or bugs, they're features. Stop voting in people that do the bidding of these ghouls and you might get somewhere.
daenz 5y ago
Politicians are just business people who haven't learned how to provide value in a free market. They still want money and power, but without providing things that people are willing to pay for. It is for this reason, I will never trust a politician to be benevolent when they want to increase taxes to prevent people from making "too much money." It's all an elaborate game, based on greed and envy, promising fairness, but actually stealing more from your pockets. Beware.
tldrthelaw 5y ago
For people aggrieved by these abuses, I highly suggest the book "The Myth of Ownership" by Prof. Liam Murphy. tldr: there is no such thing as "before tax income" as all income is only able to be earned because services paid for by taxes are satisfied necessary preconditions. Tying tax owed to services rendered calls for a change in the code to properly get to Elon's fair share. Edit: Calm down, downvoters - its not a defense of billionaires. Quite the opposite.
0110101001 5y ago
"Large IRS leak of personal income tax data" should be the real story here.
busymom0 5y ago
I am not rich by any means, nor do I own a house/car/stocks etc. And I have a severe dislike for Bezos, Buffet, Bill Gates and other CEOs (I do like Elon though as he seems to be one of the few ceos who’s actually heavily involved with his products). I also hate the massive influence big tech and massive corporations have over politicians. But I really don’t see the fascination of people with “we need to tax the rich more”. For what? To give even more money to the already bloated and corrupt government? The government has plenty of money and yet it’s not used to achieve anything positive. Places like Chicago, Baltimore get crazy amounts of money for decades but the lives of Americans living there hasn’t improved and kids are worse off today education wise. San Fran and LA have crazy taxes and yet have the worst homelessness crisis and defecation on the streets. What we should be talking about is taxing people less and getting rid of the massive bloat and corruption in the government. Getting rid of the lobbying power corporations have over Washington. Getting rid of insider trading being legal for congress and senate. Making any big tech with over a million users in the US into public utilities. Looking into how to make the military spending more efficient, stopping forever wars and cutting down on private contractors. Forcing universities to co-sign the student loans and use a percentage of the salary of the said student after graduation to pay back. Taxing the rich just for the sake of it while the government gets to eat it all without any improvement in lives is silly. I would recommend watching the first 4 minutes of this Walmart vs Morons podcast: https://youtu.be/oKFdAOKq4Lk https://youtu.be/oKFdAOKq4Lk
dang 5y ago
Recent related threads: We are publishing the tax secrets of the .001% - https://news.ycombinator.com/item?id=27434307 https://news.ycombinator.com/item?id=27434307 - June 2021 (463 comments) ProPublica's Tax Story is Misleading - https://news.ycombinator.com/item?id=27441277 https://news.ycombinator.com/item?id=27441277 - June 2021 (ongoing)
_nicelaris_ 5y ago
What an immoral nation we've become
deleted 5y ago
[deleted]

75 points by boto3 5y ago

The referred ProPublica article has a lot more details: https://www.propublica.org/article/the-secret-irs-files-trove-of-never-before-seen-records-reveal-how-the-wealthiest-avoid-income-tax https://www.propublica.org/article/the-secret-irs-files-trov...

danbrooks 5y ago
Agreed, the ProPublica article is quite precise and consistent.

vinni2 5y ago

I wonder what people think of Norwegian system where everyone’s tax information is public. https://www.forbes.com/sites/davidnikel/2020/09/04/in-norway-tax-returns-are-a-matter-of-public-record/amp/ https://www.forbes.com/sites/davidnikel/2020/09/04/in-norway...

emc3 5y ago
That question was asked in a thread on the same topic earlier today: https://news.ycombinator.com/item?id=27434929 https://news.ycombinator.com/item?id=27434929
yupper32 5y ago
Sounds horrible. I don't want people outside of my tech circle knowing how much money I make. I like my privacy. Having people know I make over $x00k a year would invite all sorts of bad things.
cheriot 5y ago
A middle ground might be public tax info for the richest 100 people. Most of them are verifying their wealth for Forbes and Bloomberg rich lists anyway.

cheriot 5y ago

> The website alleges That's an unfortunately dismissive way to refer to ProPublica. They're more accomplished than most news rooms: https://en.wikipedia.org/wiki/ProPublica#Awards https://en.wikipedia.org/wiki/ProPublica#Awards

chabons 5y ago
From the article: "[...] the BBC has not been able to confirm the claims, [...]" I don't see a problem with the word "alleges" in this context, regardless of the pedigree of the publication.
handrous 5y ago
Dismissive? It's factual. As in, "the prosecution alleges..."
- nextstep 5y ago
  I think the parent comment was referring to the characterization of ProPublica as just a “website”.

01100011 5y ago

I've seen people complaining that the article is disingenuous because it conflates income taxes with capital gains taxes. My response is 'so what'. When you make above a certain income level, you don't need anymore income and can play around with reinvesting capital gains to push taxes into the future while amassing wealth. Sure, you're not realizing the income, but what you're doing, I think, is gaining power and influence. To me, it makes some sense to tax capital gains the same as income, at least above a certain amount.

arn 5y ago
It conflates income with unrealized capital gains. You can make an argument that income and capital gains should be taxed at similar rates, but it feels like they are being purposely misleading in their presentation, when they use unrealized capital gains as the denominator. No one else’s taxes are viewed through that lens.
- zorak8me 5y ago
  I am confused. They were clearly discussing unrealized gains as wealth throughout the article. What am I missing here?
  - lotsofpulp 5y ago
    Look at this sentence in the Propublica article: > No one among the 25 wealthiest avoided as much tax as Buffett, the grandfatherly centibillionaire. That’s perhaps surprising, given his public stance as an advocate of higher taxes for the rich. It is clickbait, emotion inducing garbage. Buffett’s stance for higher taxes has nothing to do with the fact that he had less income than other rich people. I expected better from ProPublica. Arguing for taxing unrealized gains is fine, but trying to make it seem like Buffett is doing something sneaky to churn emotions is bullshit writing.
    - zorak8me 5y ago
      It certainly seems to have elicited emotions from some readers.

shoto_io 5y ago

"Don't hate the player hate the game," is what comes to my mind. I would guess it's all legal. It is still good to have transparency, which might potentially change things. I am not so sure though. After all, politicans are usually rich as well. But: All of these super-rich have probably created many, many jobs. I guess all-in-all it is a positive game for society.

vkou 5y ago
> I would guess it's all legal. When it's all secret, we can't make an informed decision on whether or not it should be legal.
- imgabe 5y ago
  Publicly release your own tax return first then. Be the change you want to see.
  - vkou 5y ago
    Nothing interesting in them. Wage income, standard deductions, some realized cap losses from a few stock sales. Looks like any other tax return. What bit of information do you expect that tax return add to the conversation of "Are the rich evading taxes?"
    - imgabe 5y ago
      We have a whole section of the government dedicated to figuring out whether people are evading taxes and then pursuing them for it. It could use some more funding, but that’s the appropriate way to do it. What are you going to add by having uninformed members of the public inspecting tax returns they don’t understand? Keep in mind there are people who turn down raises because they think being in a higher tax bracket will cause them to lose money. These are the geniuses you want to catch tax evaders?
      - vkou 5y ago

aaronschroeder 5y ago

But what is the solution? Most wealth of people like Elon Musk and Jeff Bezos is tied to ownership shares in their companies. I don't think it's fair to force them to sell shares so they can cover higher taxes. I also fear efforts to extract more tax money from them will ultimately just raise the bill for the middle class. The ultra wealthy can afford to hire a team of accountants to find the loopholes while small businesses are stuck with higher corporate tax rates.

frankbreetz 5y ago
The simple solution is to close the loopholes. Complexity is a tax on the middle class
mupuff1234 5y ago
Why is it not fair to force them? I don't think it's any more or less fair than forcing people to pay income tax.
- robryan 5y ago
  There may be unintended consequences in forcing successful founders to over time sell down a controlling stake in their company.
  - idiotsecant 5y ago
    This is like saying that homeowners are being forced to sell their homes over time to pay for property tax.
    - aaronschroeder 5y ago
      Some are. We live in an area where annual taxes are about 2% the value of the home. Home values have been skyrocketing and taxes along with them. Some people on fixed incomes can't afford it so are forced to sell. I think property tax should be abolished in general, but the problem with taxing ownership of a company is that owners are then forced to spend that much less on expenses to cover their tax burden (fewer jobs, or lower salaries for employees). A lot of companies operate close to break-even or even at a loss. What happens with the owner of a $2m / year company must come up with a 10% wealth tax amounting to $200k, but the company is operating at break-even? Expenses must be cut to pay the tax. Ultimately hurts the lower and middle class the most.

whoisburbansky 5y ago

How does tax treatment on loans taken out using unrealized capital gains as collateral work? In particular, has anybody here taken loans out on unvested RSUs?

paulpauper 5y ago
it's not income so it's not taxable

sec400 5y ago

If anyone understands the reasoning behind the US capping your deductible net capital loss in any tax year at $3,000 vs allowing your full capital losses to be offset I'd be interested.

marsrover 5y ago
Because the country is fundamentally broken.
- JumpCrisscross 5y ago
  > the country is fundamentally broken As in people ascribe ongoing debates to the system being broken, yes. Literally in this thread we have good arguments for reducing capital gains tax exclusions and special treatments and arguments for.
  - marsrover 5y ago
    Make all the good arguments you want, won't change anything.
tldrthelaw 5y ago
One big reason is to push "people" that are basically engaging in a trade or business in to being a formal business, and taking the losses as business losses.
spikels 5y ago
Idea is to prevent people from offsetting large incomes with capital losses. This simply appears unfair to many - earning lots of income but paying little tax. A more sophisticated argument is that since you can control capital losses by choosing which assets to sell you would be able to manage your taxes. With enough assets and some planning you could never pay taxes despite having a large income. The $3,000 cap prevents this. Similar approaches are used throughout the tax code to prevent abuses.

christkv 5y ago

Wealth tax is one possible solution and one that is used by at least some European countries.

cronin101 5y ago

It's bizarre to see the federal outcry here since in Norway, everyone's tax return is "public". (You can request to see anybody's but they do get a notification that you viewed it. It was anonymous until recently) It's hard to argue against sunlight being the best disinfectant.

boomboomsubban 5y ago
Is republishing it illegal? That system seems like it'd immediately have some outlet request to see everybody's tax return and reprint it to recover the anonymity.

perfunctory 5y ago

Thomas Piketty proposes a progressive annual global wealth tax of up to 2%. I think it's a good idea.

large 5y ago
I would be in favor of that if it came with the elimination of all other taxes

atlgator 5y ago

As others have stated, the article conflates income taxes with capital gains taxes. It also conflates asset ownership with income. Saying someone is "worth" a certain amount simply because they have a large stake in a corporation is an oversimplification. What they really own are illiquid assets, intellectual property, etc. Put to use, they produce income for the corporation as well as it's shareholders and employees, all of which are taxed in various ways and various levels.

gigel82 5y ago
You mean shareholders, not employees.
- atlgator 5y ago
  Shareholders and employees. Where do you think salaries come from? If employees could generate income in isolation they wouldn't need jobs would they? The assets of a company are a shared resource that benefit everyone involved with the company as well as the supply chain. Does it benefit shareholders more? Yes. Should tax loopholes be closed? Yes.
  - gigel82 5y ago
    That stopped being true sometime in the early '70s unfortunately: https://archive.is/Ouf6d https://archive.is/Ouf6d

tldrthelaw 5y ago

It isn't the fault of the driver that drives 100 mph nearly as much as it is the society that sets the speed limit to 110. No fan of the billionaires, but they're just following the code. None of these things are "loopholes" or bugs, they're features. Stop voting in people that do the bidding of these ghouls and you might get somewhere.

daenz 5y ago

Politicians are just business people who haven't learned how to provide value in a free market. They still want money and power, but without providing things that people are willing to pay for. It is for this reason, I will never trust a politician to be benevolent when they want to increase taxes to prevent people from making "too much money." It's all an elaborate game, based on greed and envy, promising fairness, but actually stealing more from your pockets. Beware.

tldrthelaw 5y ago

For people aggrieved by these abuses, I highly suggest the book "The Myth of Ownership" by Prof. Liam Murphy. tldr: there is no such thing as "before tax income" as all income is only able to be earned because services paid for by taxes are satisfied necessary preconditions. Tying tax owed to services rendered calls for a change in the code to properly get to Elon's fair share. Edit: Calm down, downvoters - its not a defense of billionaires. Quite the opposite.

0110101001 5y ago

"Large IRS leak of personal income tax data" should be the real story here.

busymom0 5y ago

I am not rich by any means, nor do I own a house/car/stocks etc. And I have a severe dislike for Bezos, Buffet, Bill Gates and other CEOs (I do like Elon though as he seems to be one of the few ceos who’s actually heavily involved with his products). I also hate the massive influence big tech and massive corporations have over politicians. But I really don’t see the fascination of people with “we need to tax the rich more”. For what? To give even more money to the already bloated and corrupt government? The government has plenty of money and yet it’s not used to achieve anything positive. Places like Chicago, Baltimore get crazy amounts of money for decades but the lives of Americans living there hasn’t improved and kids are worse off today education wise. San Fran and LA have crazy taxes and yet have the worst homelessness crisis and defecation on the streets. What we should be talking about is taxing people less and getting rid of the massive bloat and corruption in the government. Getting rid of the lobbying power corporations have over Washington. Getting rid of insider trading being legal for congress and senate. Making any big tech with over a million users in the US into public utilities. Looking into how to make the military spending more efficient, stopping forever wars and cutting down on private contractors. Forcing universities to co-sign the student loans and use a percentage of the salary of the said student after graduation to pay back. Taxing the rich just for the sake of it while the government gets to eat it all without any improvement in lives is silly. I would recommend watching the first 4 minutes of this Walmart vs Morons podcast: https://youtu.be/oKFdAOKq4Lk https://youtu.be/oKFdAOKq4Lk

dang 5y ago

Recent related threads: We are publishing the tax secrets of the .001% - https://news.ycombinator.com/item?id=27434307 https://news.ycombinator.com/item?id=27434307 - June 2021 (463 comments) ProPublica's Tax Story is Misleading - https://news.ycombinator.com/item?id=27441277 https://news.ycombinator.com/item?id=27441277 - June 2021 (ongoing)

_nicelaris_ 5y ago

What an immoral nation we've become

deleted 5y ago

[deleted]