4 ms·

Even if anyone gets a cool $1b, the IRS is going to come for a good chunk of that...

by DaiPlusPlus 3y ago

choppaface 3y ago
IRS takes less than 50%.
- willcipriano 3y ago
  A lot of this confusion is people talking past eachother. For most people the level of governmental entity taxing them isn't the concern, its the amount of tax the government in general demands in particular contrasted with the level of service provided. Add up the IRS cut, state and local, gas tax, sales tax, fees to use services already paid for with taxes and are basically required for life in the US (road tolls, document fees, vehicle registration fees, public transit fares, etc), costs for compliance with laws like hiring someone to help you file taxes or taking a day off work to renew your driver's license, higher costs for goods and services due to monopolies granted by government (drug patents where the same drug costs a quarter of what it does in the US everywhere else the world, higher than otherwise internet fees paid to entities like Comcast who are granted monopolies, hospitals that are expensive due to monopolies granted by certificates of need, etc), inflation caused by money printing to pay for foreign wars without broad popular support, housing that is more expensive due to policies that benefit homeonwers at the expense of those without assets etc, etc. Its way more than half of your productivity that is taken, if you are productive and earn wages. Those earning capital gains are hit about half as hard, another happy little accident that benefits primarily the wealthy and powerful to add to my list above. Oh and the best part, after paying those taxes for decades once you get sick, all of the sudden, the government and the medical industrial complex doesn't have the money to help you. You get to live in a cardboard box under a overpass.
  - pc86 3y ago
    You're making a comment about people "talking past each other" and yet you're talking about gas tax and sales tax in relation to business acquisitions and venture capital payouts.
gnicholas 3y ago
Yep, although the qualified small business stock exemption comes in handy if/when that happens. You get to exempt a percentage of the gain of the sale of your stock, and if you roll over the gain into other QSBS (by investing in startups, for example), you can defer the non-exempted portion.
- noduerme 3y ago
  Or just be like Peter Thiel and do all your angel investing through your Roth IRA... https://www.propublica.org/article/lord-of-the-roths-how-tech-mogul-peter-thiel-turned-a-retirement-account-for-the-middle-class-into-a-5-billion-dollar-tax-free-piggy-bank https://www.propublica.org/article/lord-of-the-roths-how-tec...
  - navane 3y ago
    He bought gambling stock with his retirement fund, struck gold, and now has 5bn untaxed in a US account?
    - vitus 3y ago
      He bought 1.7 million founders' shares of Paypal (then Confinity, which he cofounded and was CEO of at the time) for under $2000. These are terms you would never offer to an investor, that you'd never offer to an employee. For comparison, the SEC filing for Paypal's IPO has Thiel Capital investing a bridge loan of $100k in 1998 which was then converted into 500 thousand shares (100x higher valuation than his individual "purchase" the following month). https://www.sec.gov/Archives/edgar/data/1103415/000091205702023923/a2082068zs-1.htm https://www.sec.gov/Archives/edgar/data/1103415/000091205702... From the ProPublica article, re: why this was problematic: > Thiel’s unusual stock purchase risked running afoul of rules designed to prevent IRAs from becoming illegal tax shelters. Investors aren’t allowed to buy assets for less than their true value through an IRA. The practice is sometimes known as “stuffing” because it gets around the strict limits imposed by Congress on how much money can be put in a Roth.
      - 3y ago
baq 3y ago
If you’re paying taxes, you’re winning.
- rapidaneurism 3y ago
  If you're paying taxes you should change your accountant
  - SJMG 3y ago
    Yes, if you're paying taxes you should engage a wealth management team that knows about collaterialized loans.
- dspillett 3y ago
  If you are making more than enough to pay a significant amount of tax, but get away with paying a derisory amount or even nothing, then you are really winning!
generic92034 3y ago
Well, I for one could live with that... :)
coldtea 3y ago
Oh, the humanity! A founder in that situation is going to just get > 500million, not the full billion! How would they be able to afford food? Also, aren't taxes on things like stocks, equity, etc far lesser than personal income taxes anyway?

Even if anyone gets a cool $1b, the IRS is going to come for a good chunk of that...

choppaface 3y ago

IRS takes less than 50%.

willcipriano 3y ago
A lot of this confusion is people talking past eachother. For most people the level of governmental entity taxing them isn't the concern, its the amount of tax the government in general demands in particular contrasted with the level of service provided. Add up the IRS cut, state and local, gas tax, sales tax, fees to use services already paid for with taxes and are basically required for life in the US (road tolls, document fees, vehicle registration fees, public transit fares, etc), costs for compliance with laws like hiring someone to help you file taxes or taking a day off work to renew your driver's license, higher costs for goods and services due to monopolies granted by government (drug patents where the same drug costs a quarter of what it does in the US everywhere else the world, higher than otherwise internet fees paid to entities like Comcast who are granted monopolies, hospitals that are expensive due to monopolies granted by certificates of need, etc), inflation caused by money printing to pay for foreign wars without broad popular support, housing that is more expensive due to policies that benefit homeonwers at the expense of those without assets etc, etc. Its way more than half of your productivity that is taken, if you are productive and earn wages. Those earning capital gains are hit about half as hard, another happy little accident that benefits primarily the wealthy and powerful to add to my list above. Oh and the best part, after paying those taxes for decades once you get sick, all of the sudden, the government and the medical industrial complex doesn't have the money to help you. You get to live in a cardboard box under a overpass.
- pc86 3y ago
  You're making a comment about people "talking past each other" and yet you're talking about gas tax and sales tax in relation to business acquisitions and venture capital payouts.

gnicholas 3y ago

Yep, although the qualified small business stock exemption comes in handy if/when that happens. You get to exempt a percentage of the gain of the sale of your stock, and if you roll over the gain into other QSBS (by investing in startups, for example), you can defer the non-exempted portion.

noduerme 3y ago
Or just be like Peter Thiel and do all your angel investing through your Roth IRA... https://www.propublica.org/article/lord-of-the-roths-how-tech-mogul-peter-thiel-turned-a-retirement-account-for-the-middle-class-into-a-5-billion-dollar-tax-free-piggy-bank https://www.propublica.org/article/lord-of-the-roths-how-tec...
- navane 3y ago
  He bought gambling stock with his retirement fund, struck gold, and now has 5bn untaxed in a US account?
  - vitus 3y ago
    He bought 1.7 million founders' shares of Paypal (then Confinity, which he cofounded and was CEO of at the time) for under $2000. These are terms you would never offer to an investor, that you'd never offer to an employee. For comparison, the SEC filing for Paypal's IPO has Thiel Capital investing a bridge loan of $100k in 1998 which was then converted into 500 thousand shares (100x higher valuation than his individual "purchase" the following month). https://www.sec.gov/Archives/edgar/data/1103415/000091205702023923/a2082068zs-1.htm https://www.sec.gov/Archives/edgar/data/1103415/000091205702... From the ProPublica article, re: why this was problematic: > Thiel’s unusual stock purchase risked running afoul of rules designed to prevent IRAs from becoming illegal tax shelters. Investors aren’t allowed to buy assets for less than their true value through an IRA. The practice is sometimes known as “stuffing” because it gets around the strict limits imposed by Congress on how much money can be put in a Roth.
    - 3y ago

baq 3y ago

If you’re paying taxes, you’re winning.

rapidaneurism 3y ago
If you're paying taxes you should change your accountant
- SJMG 3y ago
  Yes, if you're paying taxes you should engage a wealth management team that knows about collaterialized loans.
dspillett 3y ago
If you are making more than enough to pay a significant amount of tax, but get away with paying a derisory amount or even nothing, then you are really winning!

generic92034 3y ago

Well, I for one could live with that... :)

coldtea 3y ago

Oh, the humanity! A founder in that situation is going to just get > 500million, not the full billion! How would they be able to afford food? Also, aren't taxes on things like stocks, equity, etc far lesser than personal income taxes anyway?