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> On paper. As far as I know there are a myriad of ways to circumvent paying taxes. Please let me know then! 37% top income tax bracket + 15.3% self employment

> On paper. As far as I know there are a myriad of ways to circumvent paying taxes. Please let me know then! 37% top income tax bracket + 15.3% self employment social security and medicare is 52.3% right there! and we aren’t included state or local or other taxes and fees involved in running a business. It seems people get confused about capital gains taxes vs income taxes. That $927/4220 is almost certainly capital gains taxes.

ceejayoz 3y ago
> It seems people get confused about capital gains taxes vs income taxes. Among them, you! The people in this article aren’t buying them out of paychecks. Capital gains rates are their worst case scenario. They’re paying next to nothing into Social Security (remember, only the first $160k income gets taxed there) and they aren’t paying into Medicare (Jobs’ famous $1 salary would result in about a penny).
- alchemist1e9 3y ago
  > Among them, you! The people in this article aren’t buying them out of paychecks. Capital gains rates are their worst case scenario. I know that however unless they are selling assets they will still need to pass through as income. The idea that capital gains taxes are low is also insane. Those are assets that are being sold. Yes they may have started as worth zero when the company was formed but when they sell stock someone else now owns it. The fact we accept the government is entitled to 15% of that asset value increase is frankly insane. I’d also like to mention that most people on paychecks are not aware of how much they are being taxed as they believe the absurd euphemistically named “employer” taxes aren’t a tax on them directly. Any tax the employer wouldn’t pay if they weren’t employed is a tax on them, regardless of how you name and collect it. Without payroll collection of taxes there is no way the government would politically get away with the extreme high tax rates on the general populations of western governments.
  - gaadd33 3y ago
    Why sell assets when you can get a loan against them and the appreciation covers the interest cost? Then you have no taxes to pay and plenty of money to spend.
    - alchemist1e9 3y ago
      I don’t get it, eventually you have to pay back the loan and pay the capital gains tax, so what? People do what you suggest and there isn’t anything wrong with it, they still pay same taxes eventually.
      - ceejayoz 3y ago
        If you have $10 billion in shares, you take out a billion in a loan with the shares as collateral. You repay it out of that billion, at low interest. Start running low? Take another loan. The shares are worth $20B now anyways! Never actually having to sell shares means no taxes, plenty of operating funds. Quite common. https://www.propublica.org/article/billionaires-tax-avoidance-techniques-irs-files https://www.propublica.org/article/billionaires-tax-avoidanc...
        alchemist1e9 3y ago
        I don’t see there being any issue. Eventually the final loan will be repaid with income. Like most of these types of articles they are just Envy clickbait nonsense.
        ceejayoz 3y ago
        > Eventually the final loan will be repaid with income. Scroll down to #2. Thiel, for example, managed to get $5B into a Roth IRA. > What’s more, as long as Thiel waits to withdraw his money until April 2027, when he is six months shy of his 60th birthday, he will never have to pay a penny of tax on those billions. There are too many tricks available for them to wind up paying a fair share of taxes.
seattle_spring 3y ago
SS and Medicare are largely capped at around $150k, and the 37% tax bracket doesn't kick in until an income well above $500k. Using those figures and claiming it means that your "tax rate is 50% right there" is extremely disingenuous, bordering on outright lying.
- alchemist1e9 3y ago
  A realistic expectation of most small entrepreneurs is to generate something around $1M/year and the overall tax rate for them will be around 50% or more.
  - ceejayoz 3y ago
    The people buying elaborate luxury bunkers in New Zealand aren’t “small entrepreneurs”.

ceejayoz 3y ago

> It seems people get confused about capital gains taxes vs income taxes. Among them, you! The people in this article aren’t buying them out of paychecks. Capital gains rates are their worst case scenario. They’re paying next to nothing into Social Security (remember, only the first $160k income gets taxed there) and they aren’t paying into Medicare (Jobs’ famous $1 salary would result in about a penny).

alchemist1e9 3y ago
> Among them, you! The people in this article aren’t buying them out of paychecks. Capital gains rates are their worst case scenario. I know that however unless they are selling assets they will still need to pass through as income. The idea that capital gains taxes are low is also insane. Those are assets that are being sold. Yes they may have started as worth zero when the company was formed but when they sell stock someone else now owns it. The fact we accept the government is entitled to 15% of that asset value increase is frankly insane. I’d also like to mention that most people on paychecks are not aware of how much they are being taxed as they believe the absurd euphemistically named “employer” taxes aren’t a tax on them directly. Any tax the employer wouldn’t pay if they weren’t employed is a tax on them, regardless of how you name and collect it. Without payroll collection of taxes there is no way the government would politically get away with the extreme high tax rates on the general populations of western governments.
- gaadd33 3y ago
  Why sell assets when you can get a loan against them and the appreciation covers the interest cost? Then you have no taxes to pay and plenty of money to spend.
  - alchemist1e9 3y ago
    I don’t get it, eventually you have to pay back the loan and pay the capital gains tax, so what? People do what you suggest and there isn’t anything wrong with it, they still pay same taxes eventually.
    - ceejayoz 3y ago
      If you have $10 billion in shares, you take out a billion in a loan with the shares as collateral. You repay it out of that billion, at low interest. Start running low? Take another loan. The shares are worth $20B now anyways! Never actually having to sell shares means no taxes, plenty of operating funds. Quite common. https://www.propublica.org/article/billionaires-tax-avoidance-techniques-irs-files https://www.propublica.org/article/billionaires-tax-avoidanc...
      - alchemist1e9 3y ago
        I don’t see there being any issue. Eventually the final loan will be repaid with income. Like most of these types of articles they are just Envy clickbait nonsense.
        ceejayoz 3y ago
        > Eventually the final loan will be repaid with income. Scroll down to #2. Thiel, for example, managed to get $5B into a Roth IRA. > What’s more, as long as Thiel waits to withdraw his money until April 2027, when he is six months shy of his 60th birthday, he will never have to pay a penny of tax on those billions. There are too many tricks available for them to wind up paying a fair share of taxes.

seattle_spring 3y ago

SS and Medicare are largely capped at around $150k, and the 37% tax bracket doesn't kick in until an income well above $500k. Using those figures and claiming it means that your "tax rate is 50% right there" is extremely disingenuous, bordering on outright lying.

alchemist1e9 3y ago
A realistic expectation of most small entrepreneurs is to generate something around $1M/year and the overall tax rate for them will be around 50% or more.
- ceejayoz 3y ago
  The people buying elaborate luxury bunkers in New Zealand aren’t “small entrepreneurs”.