wealthiest person in each state

Quote: AZDuffman

"Loopholes" are just the law. Loudmouths like Gates and Buffet say taxes should be higher while they use the law to minimize their own taxes. Fools then say, "SEESEESEE! They want higher taxes!"

No, fools think they’re arguing that people should voluntarily not use such loopholes, when they’re actually arguing the loopholes should be closed.

Quote: rxwine

No, fools think they’re arguing that people should voluntarily not use such loopholes, when they’re actually arguing the loopholes should be closed.

If you want to pay higher taxes you are free to do so. I use any "loophole" that I can. But I do not do that and then say taxes need to be raised.

If Buffet really thought he did not pay enough taxes he could take more in salary and pay the tax. He doesn't. then fools say that taxes need to be raised because "even Warren Buffet thinks taxes are too low!"

It is like being on death row and saying you are a carpenter and will help build the gallows.

Quote: AZDuffman

If you want to pay higher taxes you are free to do so. I use any "loophole" that I can. But I do not do that and then say taxes need to be raised.

If Buffet really thought he did not pay enough taxes he could take more in salary and pay the tax. He doesn't. then fools say that taxes need to be raised because "even Warren Buffet thinks taxes are too low!"

It is like being on death row and saying you are a carpenter and will help build the gallows.

]

Is it still night where you are, because it’s clear as day, if he thought the only problem was that he wasn’t paying enough and only HE should pay more, then HE would just do that, problem solved, and not say the wealthy should pay more.

Some people want daylight savings time to end, but they don’t just start showing up an hour early or late if it still exists.

Quote: rxwine

]

Is it still night where you are, because it’s clear as day, if he thought the only problem was that he wasn’t paying enough and only HE should pay more, then HE would just do that, problem solved, and not say the wealthy should pay more.

Some people want daylight savings time to end, but they don’t just start showing up an hour early or late if it still exists.

If you were King rx how much of his networth would Bezos pay in taxes each year?

Quote: AZDuffman

No different than someone owning a house and taking out a HELOC. Not hinky at all, it is smart to minimize your taxes.

Borrowing is of course not income, but when you pay it back you pay tax on the income you made to pay it back.

In fact the taxes are never paid on the money that funds the lifestyle of the super rich. Economist Laurence Kotlikoff explains it this way.

Quote:

They simply don’t declare any income. Instead, they hold their wealth in assets whose values rise through time but throw off no taxable income. An example is stocks that don’t pay dividends, but appreciate as the income, which would otherwise be paid out, is reinvested.

But don’t the rich need to sell some assets to cover their annual spending? And doesn’t that spell capital gains taxes?

No.

The super rich can sell assets that experienced capital losses to pay for their consumption. More importantly, they can borrow to pay for consumption and pledge their assets as collateral. Yes, their cumulative borrowing will rise through time, but so will the value of their assets. Hence, the banks are happy to keeping lending to the super rich to cover not just current spending, but also interest owed on prior borrowing. The topper here is that when the super rich die, they leave these appreciated assets to their heirs free of any capital gains tax liability via what’s called a "step up in basis."

https://www.forbes.com/sites/kotlikoff/2016/10/20/getting-the-super-rich-to-pay-taxes/?sh=7795158871f0

"step up basis" means the heirs can repay the loans by selling assets and pay no capital gains. Kotlikoff advocates a consumption tax. I strongly prefer that to a wealth tax. They evidently have ways around the inheritance tax too. I don't pretend to completely understand it. When I get super rich I'll research it.

Quote: kenarman

If you were King rx how much of his networth would Bezos pay in taxes each year?

I think Jim Rockford’s post illustrates where some of the problem is. Wouldn’t matter if his tax rate was 90% if he can basically nullify the amount.

Quote: JimRockford

In fact the taxes are never paid on the money that funds the lifestyle of the super rich. Economist Laurence Kotlikoff explains it this way.

https://www.forbes.com/sites/kotlikoff/2016/10/20/getting-the-super-rich-to-pay-taxes/?sh=7795158871f0

"step up basis" means the heirs can repay the loans by selling assets and pay no capital gains. Kotlikoff advocates a consumption tax. I strongly prefer that to a wealth tax. They evidently have ways around the inheritance tax too. I don't pretend to completely understand it. When I get super rich I'll research it.

So, you are saying they are doing the same thing as people who take out a HELOC?

The loans will need to be paid, and taxes will be paid on that money. The difference remains that you can be rich via income or "wealth."

Performers and sports players are some of the few who are rich via income. Say you play NFL ball and are a decent player, you get say $5MM a year. Your opportunity to minimize taxes is minimal. You can take your pay over more years, for example signing bonuses are not one check as people believe but structured over years if you have a smart agent. But it is still income.

If you have rental properties or a small business you can get to the same $5MM but most of it is tied up in assets. You cannot live like a hog in the fat house like the athlete as it is not liquid. If you are smart you are able to make many things business expenses. For example, on a small scale I am currently remodeling a rental unit and have parlayed my purchases into about 40 gallons of free gas. I have to do this as most of that wealth is locked up and illiquid.

My position remains. People like Gates and Buffet crying for higher taxes while using the system to pay the least taxes are no different than some TV preacher saying money is evil so send yours to him.

Quote: AZDuffman

So, you are saying they are doing the same thing as people who take out a HELOC?

The loans will need to be paid, and taxes will be paid on that money. The difference remains that you can be rich via income or "wealth."

No, My post says the opposite.

Quote: JimRockford

No, My post says the opposite.

Except you cannot just take loans and never repay them.

Quote: AZDuffman

Except you cannot just take loans and never repay them.

The super rich guy takes the loans to his grave. When his heirs inherit his assets the cost basis is reset so they can then be sold to repay the loans with no capital gains and therefore no income tax is paid on the money used to repay the loans.