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They don't pay anywhere close to that, there are tons of tricks to avoid paying that % on gains and the more money you have the more leeway for loopholes. Very
by radicaldreamer 2y ago
They don't pay anywhere close to that, there are tons of tricks to avoid paying that % on gains and the more money you have the more leeway for loopholes.
Very relevant in startup ecosystem as well (look up exchange funds, opportunity zones etc.)
- WalterBright 2y ago40% of Federal income tax revenue comes from the top 1%.
- triceratops 2y agoWhat percent of all income do they make? Edit: it's an honest question. Maybe the top 1% paying 40% of all income taxes is too much tax. Maybe it's not enough. Without knowing how much of all the income they make it's a meaningless number.
- rayiner 2y ago20%. https://ourworldindata.org/grapher/income-share-top-1-before-tax-wid https://ourworldindata.org/grapher/income-share-top-1-before...
- crmd 2y agoAccording to the Tax Foundation[1], for tax year 2021, the top 1% of U.S. earners—those with an adjusted gross income (AGI) of $682,577 or more—accounted for 26.3% of total AGI and paid 45.8% of all federal income taxes. My personal opinion is that income tax should be more progressive, but I know that plenty of smart people disagree on that. [1] https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/ https://taxfoundation.org/data/all/federal/latest-federal-in...
- killjoywashere 2y agoYour source leans right-center, so probably good reason to suspect their reported top 1% AGI is low and their reported federal income tax estimate is high. https://mediabiasfactcheck.com/tax-foundation/ https://mediabiasfactcheck.com/tax-foundation/
- refurb 2y agoIt’s IRS data. You can download it from the IRS website and replicate the analysis and prove them wrong if you’d like.
- hnburnsy 2y agohttps://fee.org/articles/5-reasons-to-avoid-ad-hominem-arguments/ https://fee.org/articles/5-reasons-to-avoid-ad-hominem-argum...
- tbrownaw 2y ago1. Does not follow. Just because you don't like someone's politics doesn't mean they're dishonest. 2. Your own link contradicts you. It says explicitly that that site hasn't failed any of their fact checks and doesn't use loaded words that they say are typical of that category. It says the categorization is because the site promotes libertarian policies.
- wat10000 2y agoThere are a lot more taxes than the federal income tax. It happens to be one of the most progressive taxes. Anyone focusing on that and ignoring all the others is trying to scam you.
- crmd 2y agoThis is true for ultra high net worth individuals. They can do schemes like borrowing against equities and using the tax-free cash for expenses or purchasing other assets. It is also true for many “normal” one percenters. For example there is a service for incorporated anesthesiologists where you tell them where you plan to go on vacation and what dates, and they create a bullshit anesthesiology conference, including the brochure and other artifacts, that meet the letter of the law IRS definitions for a valid business expense. None of this stuff ever hits AGI.
- WalterBright 2y ago> This is true for ultra high net worth individuals. Anyone can borrow money against their stocks, house, or credit card. It's tax-free as well. > They can do schemes like borrowing against equities and using the tax-free cash for expenses or purchasing other assets. Um, borrowing money is not "income". You have to pay it back, with interest.
- triceratops 2y agoIf the asset appreciates faster than the interest rate there's never a need to sell. If the interest rate is lower than the capital gains tax rate, paying the interest is cheaper than paying taxes. UHNW individuals can borrow until they die. Their assets pass to their heirs with a stepped up cost basis. The heirs can liquidate whatever's needed to pay off the loan and incur no tax. Normal people can't do this. If I die owing money, my creditors will take it out of my estate before it passes to my heirs. UHNW estates can be structured differently and creditors can accommodate different payment terms (get paid second) because they know the money's there, and it saves taxes. You can also read: https://www.reddit.com/r/BuyBorrowDieExplained/comments/1f26rsf/buy_borrow_die_explained/ https://www.reddit.com/r/BuyBorrowDieExplained/comments/1f26... I might have gotten some things wrong. Or maybe the poster has.
- caslon 2y agoThe top 1% of people make 20.7% of the country's income. Given progressive tax rates, they should be paying a lot more than 40% of Federal income tax revenue, but rates don't scale enough, and aren't lax enough on other classes.
- listenallyall 2y agoCan you explain your reasoning behind "they should be paying a lot more"? I kept hearing that they didn't pay their "fair share" when in fact it appears they pay double. It just seems like whatever they actually pay, measured in dollars or as a percentage, will always be widely regarded as not enough.
- roenxi 2y agoThere are a couple of key phrases in politics that get used because there is no actual justification. "Fair" is one of them. It is impossible to achieve fairness in the tax system under any circumstances, it is always taking from someone who - from the fact that it isn't voluntary - we can assume quite likely disagrees with how the money is about to be used. Taxes are fundamentally arbitrary. So in practice, if "fair" is used in politics the appropriate reading is often as a euphemism for "I think we have the numbers to push this interpretation of the world on people; it'll be good for us".
- tomlockwood 2y agoCould you help me understand why an individual with one billion, needs two? At what point would you accept that someone has more money than they'd reasonably need? And if you just thought of a maximum amount, then, wouldn't the acceptable tax rate over that amount, be 100%?
- throwaway-blaze 2y agoAssume you think the government is in a better position to spend that billion than the billionaire is to figure out what to buy or invest their money in? I know he's out of favor with a lot of people, but would Elon have created SpaceX or The Boring Co or Neuralink, or helped start OpenAI if he hadn't had the spare billions to do so? I'd much rather have multi-billionaires investing in the economy, and in the future, than giving additional money to the government.
- stolati 2y agohttps://nymag.com/intelligencer/article/fact-check-richest-1-dont-pay-40-of-the-taxes.html https://nymag.com/intelligencer/article/fact-check-richest-1...
- deleted 2y ago[deleted]
- Jabbles 2y agoThis conversation is about billionaires, not the top 1%.
- rurp 2y agoImagine how much federal revenue would increase if that 1% paid the same effective rate as say a typical plumber, rather than the <10% they currently pay. That might actually put a dent in the trillions of dollars this congress is about to add to the national debt.
- twoodfin 2y agohttps://www.pewresearch.org/short-reads/2023/04/18/who-pays-and-doesnt-pay-federal-income-taxes-in-the-us/ https://www.pewresearch.org/short-reads/2023/04/18/who-pays-... For one thing, many plumbers do make it to the 1%: Trades are a profitable line of work for the industrious. But the median 1%’er is paying 3-4X the effective rate of the overall median earner.
- CursedSilicon 2y agoSo if they're earning 50x as much, why are they only paying 3-4x the tax?
- WalterBright 2y ago>> is paying 3-4X the effective rate > why are they only paying 3-4x the tax? You have conflated the tax rate with the tax amount.
- gosub100 2y ago[flagged]
- saagarjha 2y agoThey did! Then someone decided that was waste and installed incompetent people over it.
- WalterBright 2y ago> rather than the <10% they currently pay I suspect you're using a different definition of "income" than the IRS. What is it?
- chris_wot 2y agoThe top 1% own 39% of everything in the U.S. You are not in the top 1%. Why are you complaining again?
- WalterBright 2y agoThe city claims to own my house, as they charge me rent every year, and have a long list of things I'm not allowed to do with it. That rent went up over 10% last year. For contrast, the rent control people want to cap rent increases to 7%.
- chris_wot 2y agoMy heart bleeds for you.
- WalterBright 2y agoI appreciate your concern.
- specialist 2y agoThat seems excessive. Corporations are persons, right? Why is their tax rate just half that of real people? Why aren't all persons taxed equally?
- eli_gottlieb 2y agoIf they don't wanna pay so much in taxes, they should stop having so much money. Taxes function to raise revenue and thus have to go where the money is.
- hnburnsy 2y agoThere are no loopholes for investment gains. If you are talking about offsetting losses and delaying gains, those options would likely be available to endowment funds.