4 ms·

So less than 3.4% on average. How much do you pay?

by johnrbent 5y ago

dwighttk 5y ago
Wealth is not income
NovemberWhiskey 5y ago
I pay 0% federal income taxes on my wealth; the same as everyone else.
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- adrian_b 5y ago
  By stressing "federal income taxes" I assume that you mean that there are local taxes on wealth. I do not know how it is in USA, but in most countries there are taxes on wealth, typically at least on houses, cars and land. Wherever I have seen the amount of those taxes, they were already too high in my opinion. Moreover, the inheritance taxes are also a kind of tax on wealth and they are also quite high in many places. In my opinion taxes on wealth should be reduced, not increased, because I have seen cases when someone happened to be jobless for some time, thus having no income. While without the burden of taxes on wealth they could have lived decently for a longer time, waiting for an opportunity, the necessity of paying the taxes could force them to sell their property at loss and risk becoming homeless. I do not think that is right. On the other hand, when someone owns much more wealth than would be needed to ensure a decent life until dying of old age, then I would accept that it is right to tax the excess wealth. However, I have seen too many cases when the introduction of taxes on wealth was justified as "tax for the rich", but in the actual law the taxation thresholds were so low that the taxes affected mostly the lower end of the middle class, not the really rich.
  - NovemberWhiskey 5y ago
    >By stressing "federal income taxes" I assume that you mean that there are local taxes on wealth. I'm just re-using the exact same phrasing from the article to point out how disingenuous it is.
  - csomar 5y ago
    > However, I have seen too many cases when the introduction of taxes on wealth was justified as "tax for the rich", but in the actual law the taxation thresholds were so low that the taxes affected mostly the lower end of the middle class, not the really rich. Don't be deluded. These taxes are targeting the middle-class and the upper-middle-class (which is considered the "rich"). The "very rich" like Bezos have most of their wealth in stocks. These stocks will considerably go down if you had a wealth tax, and as a result bring little tax income.
- lightcatcher 5y ago
  How much wealthier would you be if you paid no taxes at all in tax year 2020? An example with some made-up numbers that could apply to some HN users: Let's say your net worth was $500K at the start of the year, you earned $200K income in the year and spent $50K. Without taxes, your end of year net worth would be $650K. However, you pay $40K+ in taxes, which makes your net worth <=$610K. So effectively you paid $40K/$650K = 6.1% of your wealth in taxes. "Regular" people build wealth through income, while wealthy build wealth through appreciating assets. The point I take from headlines like these are not "US executives illegally avoid taxes", it is "tax rules favor the wealthy". Increasing tax on appreciated assets by raising capital gains rates, removing step-up basis, or (maybe) taxing unrealized gains could shift some of the tax drag on wealth from income earners towards asset holders. All of these would need to be done very carefully to not overly hurt small business owners, perhaps through something like a lifetime capital gains exemption (similar to gift exemption, apparently existed in Canada in the 80s[0]). [0]: https://static.twentyoverten.com/5b9280ab0420c067d6b36505/WogXFy6Jxuo/the-lifetime-capital-gains-exemption.pdf https://static.twentyoverten.com/5b9280ab0420c067d6b36505/Wo...
chromatin 5y ago
I pay zero percent on my wealth, just like you. You should consider revising your comment as you were duped by poor journalism.
- johnrbent 5y ago
  I'll admit, I read it as income. But it does make me start to think about the disparities in how wealth is generated across different classes of Americans. For me, wealth is almost 100% generated by my income, so I would say my income tax is basically a wealth tax.
  - furgooswft13 5y ago
    > so I would say my income tax is basically a wealth tax. Indeed, sounds like a great reason to abolish the income tax.
- kasey_junk 5y ago
  You could calculate your income tax to wealth ratio though right? The reason it’s important is that these executives are not paid “income”. Their wealth increases because it’s largely in shares of their companies and then they use non (or low) taxable events to get cash to buy their stuff. This sort of activity is not available to people whose only source of cash is income. I’m not sure it’s worth the unintended consequences of changing the tax laws to change this but it’s not poor journalism to point it out and start the conversation. Edit: I just calculated mine and depending on how you value my home it’s between 5-9% for 2020.
  - NovemberWhiskey 5y ago
    From my point of view, it is poor journalism to use a clickbait headline ($13.6 billion is not little-to-nothing) and misleading presentation of data (incomes taxes of X on wealth of Y). It's also lazy journalism as it just piggy-backs on top of the illegally-obtained IRS data from ProPublica, and produces all of its quotes from Twitter or other news media sources.
- 5y ago

So less than 3.4% on average. How much do you pay?

dwighttk 5y ago

Wealth is not income

NovemberWhiskey 5y ago

I pay 0% federal income taxes on my wealth; the same as everyone else.

deleted 5y ago
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  [deleted]
deleted 5y ago
[deleted]
adrian_b 5y ago
By stressing "federal income taxes" I assume that you mean that there are local taxes on wealth. I do not know how it is in USA, but in most countries there are taxes on wealth, typically at least on houses, cars and land. Wherever I have seen the amount of those taxes, they were already too high in my opinion. Moreover, the inheritance taxes are also a kind of tax on wealth and they are also quite high in many places. In my opinion taxes on wealth should be reduced, not increased, because I have seen cases when someone happened to be jobless for some time, thus having no income. While without the burden of taxes on wealth they could have lived decently for a longer time, waiting for an opportunity, the necessity of paying the taxes could force them to sell their property at loss and risk becoming homeless. I do not think that is right. On the other hand, when someone owns much more wealth than would be needed to ensure a decent life until dying of old age, then I would accept that it is right to tax the excess wealth. However, I have seen too many cases when the introduction of taxes on wealth was justified as "tax for the rich", but in the actual law the taxation thresholds were so low that the taxes affected mostly the lower end of the middle class, not the really rich.
- NovemberWhiskey 5y ago
  >By stressing "federal income taxes" I assume that you mean that there are local taxes on wealth. I'm just re-using the exact same phrasing from the article to point out how disingenuous it is.
- csomar 5y ago
  > However, I have seen too many cases when the introduction of taxes on wealth was justified as "tax for the rich", but in the actual law the taxation thresholds were so low that the taxes affected mostly the lower end of the middle class, not the really rich. Don't be deluded. These taxes are targeting the middle-class and the upper-middle-class (which is considered the "rich"). The "very rich" like Bezos have most of their wealth in stocks. These stocks will considerably go down if you had a wealth tax, and as a result bring little tax income.
lightcatcher 5y ago
How much wealthier would you be if you paid no taxes at all in tax year 2020? An example with some made-up numbers that could apply to some HN users: Let's say your net worth was $500K at the start of the year, you earned $200K income in the year and spent $50K. Without taxes, your end of year net worth would be $650K. However, you pay $40K+ in taxes, which makes your net worth <=$610K. So effectively you paid $40K/$650K = 6.1% of your wealth in taxes. "Regular" people build wealth through income, while wealthy build wealth through appreciating assets. The point I take from headlines like these are not "US executives illegally avoid taxes", it is "tax rules favor the wealthy". Increasing tax on appreciated assets by raising capital gains rates, removing step-up basis, or (maybe) taxing unrealized gains could shift some of the tax drag on wealth from income earners towards asset holders. All of these would need to be done very carefully to not overly hurt small business owners, perhaps through something like a lifetime capital gains exemption (similar to gift exemption, apparently existed in Canada in the 80s[0]). [0]: https://static.twentyoverten.com/5b9280ab0420c067d6b36505/WogXFy6Jxuo/the-lifetime-capital-gains-exemption.pdf https://static.twentyoverten.com/5b9280ab0420c067d6b36505/Wo...

chromatin 5y ago

I pay zero percent on my wealth, just like you. You should consider revising your comment as you were duped by poor journalism.

johnrbent 5y ago
I'll admit, I read it as income. But it does make me start to think about the disparities in how wealth is generated across different classes of Americans. For me, wealth is almost 100% generated by my income, so I would say my income tax is basically a wealth tax.
- furgooswft13 5y ago
  > so I would say my income tax is basically a wealth tax. Indeed, sounds like a great reason to abolish the income tax.
kasey_junk 5y ago
You could calculate your income tax to wealth ratio though right? The reason it’s important is that these executives are not paid “income”. Their wealth increases because it’s largely in shares of their companies and then they use non (or low) taxable events to get cash to buy their stuff. This sort of activity is not available to people whose only source of cash is income. I’m not sure it’s worth the unintended consequences of changing the tax laws to change this but it’s not poor journalism to point it out and start the conversation. Edit: I just calculated mine and depending on how you value my home it’s between 5-9% for 2020.
- NovemberWhiskey 5y ago
  From my point of view, it is poor journalism to use a clickbait headline ($13.6 billion is not little-to-nothing) and misleading presentation of data (incomes taxes of X on wealth of Y). It's also lazy journalism as it just piggy-backs on top of the illegally-obtained IRS data from ProPublica, and produces all of its quotes from Twitter or other news media sources.
5y ago