Replies to post #66053 on LEE KRAMER'S ROOM: With Views

[PegnVA]

IRS RECORDS SHOW WEALTHIEST AMERICANS, INCLUDING BEZOS AND MUSK, PAID LITTLE IN INCOME TAXES AS SHARE OF WEALTH, REPORT SAYS.
ProPublica obtains tax data on richest Americans, which could send Washington scrambling
By Todd C. Frankel and Douglas MacMillan
June 8, 2021 at 4:48 p.m. EDT

https://www.washingtonpost.com/business/2021/06/08/wealthy-irs-taxes/

[BullNBear52]

Raise taxes on ordinary income: Senator Bernie Sanders would raise the top federal income tax rate https://www.bernietax.com/#0;0;s .. from today’s 37 percent to 52 percent for households making $10 million a year or more. Representative Alexandria Ocasio-Cortez (D-NY) would raise the income tax rate on those same households to 70 percent.

We'll see pigs flying before the rate goes that high.

The NYT explained the loopholes this morning.

‘Buy, borrow, die’

A central reason that very wealthy people can avoid taxes is that the U.S. system taxes only so-called realized gains — like wages or stock sales. But the wealthy often live off unrealized gains — in the form of stocks and other assets that grow more valuable over time. The wealthy borrow against these assets to pay for houses, islands and private planes and then use a variety of strategies to avoid paying taxes on the debt repayment.

One such strategy is waiting until after death to repay the loan — or what Edward McCaffery, a tax expert at the University of Southern California, calls “buy, borrow, die.” Robert McClelland of the Tax Policy Center called it the main revelation of the ProPublica story.

All the while, the wealthy are often able to keep their taxable income low. In 2011, Bezos reported so little income that he qualified for — and claimed — a $4,000 child tax credit. In both 2016 and 2017, Carl Icahn, who’s a billionaire, paid no federal income taxes.

Legal tax avoidance by the wealthy has become more widespread over the past half-century for several reasons. For one, inequality has soared, meaning that the rich have more wealth to protect. And tax rates have fallen significantly.

“It’s amazing how much we’ve cut taxes even since 1997 — on dividends, the estate tax threshold, capital gains and the top rate,” Owen Zidar, a Princeton University economist, told me. “All of those things have become more favorable to the top of the distribution.” The decline in the corporate tax rate — effectively a tax reduction for shareholders — has also been important.

https://www.nytimes.com/2021/06/09/briefing/tax-jeff-bezos-wealthy.html?action=click&module=Briefings&pgtype=Homepage

One way to fix the above is tax unrealized gains on an annual basis.

Corporations after SOX was passed have to mark to market their investments and good will on a quarterly basis.

So rather than Jeff borrow against his Amazon stock; he would have to pay tax on the gain if it went up in value annually. Of course if it dropped he could take the loss.

Or he could just start cashing in some of his stock and pay the capital gains. FYI, that would also affect everyone who trades stock for full disclosure.

As for corporations Biden is off to the G-7 meet to push for a minimum 15% tax on corporations amongst the member countries. Since the GOP refuses to even think about that here he has little chance of winning the day.

Look up the companies that paid no corporate tax in 2019.

There is a reason why Apple is incorporated in Ireland.

The G7 deal will force tax havens like Ireland to rethink their economy

https://qz.com/2017715/the-g7-tax-deal-forces-ireland-to-rethink-its-tax-haven-economy/

The company I worked for before retirement used to be based in the USA. Off to England we went at a much cheaper rate. After Brexit they said time to move to Ireland. lol.

Our tax code needs some serious reform.

[BullNBear52]

And one final point. The IRS staffing has been slashed for years by the GOP.

Biden has recognized that because of staffing cuts million of dollars are being lost through the audit and collection process.

Biden proposes doubling IRS workforce as part of plan to snag tax cheats
The department’s total budget would increase by about 10 percent annually.

https://www.politico.com/news/2021/05/20/irs-funding-boost-489830#:~:text=President%20Joe%20Biden%20is%20proposing,to%20chase%20down%20tax%20cheats.

I know exactly what he is talking about. Now get the GOP to go along.