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The Top 10%


redbarron77

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Rich keep getting richer, calling themselves "corporations" and getting taxed at less than 1/2 the rate as the rest of us...

 

Money makes money, so the richest make it literally faster than they can spend it, just by letting their wealth grow in interest...

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Rich keep getting richer, calling themselves "corporations" and getting taxed at less than 1/2 the rate as the rest of us...

Money makes money, so the richest make it literally faster than they can spend it, just by letting their wealth grow in interest...

Incorporating basically subjects business owners to double taxation-- through the 35% corporate income tax (which is the highest in the developed world) and an additional tax on capital gains and dividends.

There are good legal reasons to incorporate, but the idea that there exists some huge and unfair tax exploit is false.

And regarding interest income... I can tell you something about that over the last five year. The nominal rate on the 10 year t bill has been under 2%, and inflation has been around the same level, so were left with a real return around 0% and at some points negative. Before tax. Interest is taxed at the nominal rather than real rate of return, so the real effective tax rate on risk free investments ends up being something like 100% in recent times.

Things are rarely as simple as the typical populist talking points.

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Incorporating basically subjects business owners to double taxation-- through the 35% corporate income tax (which is the highest in the developed world) and an additional tax on capital gains and dividends.

 

 

Not if your "income" IS Capital Gains and dividens... (I.E. your "job" is an investor)

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This article is talking about the stock market recession and the subsequent market rally. 

 

"Incomes among the richest fell more than 36% between 2007-09, compared with a decrease of 11.6% for the rest of Americans. But in the last three years, 95% of all income gains have gone to the richest 1%."

 

If a person was heavily invested in stocks, funds, etc their income took a big hit during the recession, and should now being making pretty good gains (unless they panicked and sold).  Wealthier people tend to be more heavily invested.  None of this is particularly surprising.

 

 

The same thing happened to nearly everyone's 401k, but those $$ aren't considered (taxable) income until you retire. 

Edited by Tpoppa
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Rich keep getting richer, calling themselves "corporations" and getting taxed at less than 1/2 the rate as the rest of us...

Money makes money, so the richest make it literally faster than they can spend it, just by letting their wealth grow in interest...

What's wrong with this?

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Rich keep getting richer, calling themselves "corporations" and getting taxed at less than 1/2 the rate as the rest of us...

 

Pretty inaccurate actually.

 

Forming a corporation is not reserved for the wealthy.  Anyone with 50 bucks can form a corporation.  And if you did, how exactly are you only paying half your income tax?  I'd love to lower my tax burden :)

 

If you mean capital gains tax, people in the lowest 2 tax brackets pay zero (long-term) capital gains tax.  Higher tax brackets pay either 15 or 20% capital gains.

 

If you raise capital gains, you are basically eliminating some of the incentive for investors to invest in stocks, funds, etc.  Investors would pull (some) funds out of the stock market, risking another recession, or worse. 

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Mmmm... Eat the rich. I like mine with a side of hypocrisy and a sprinkle of blind jealousy.

Exactly. If starting and growing a business into a huge corporation is such a sweet deal, write up a business plan, get some investors to back you, bust your ass for 10 or 20 years, go public, deal with shareholders, and enjoy your millions.

If it were easy, everyone would do it.

A hard-working and motivated individual has every opportunity to start his own small business, bring in a livable wage, and have something to sell or pass onto his kid(s) when he retires. Every OPPORTUNITY. No guarantees. Nothing risked, nothing gained.

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Exactly. If starting and growing a business into a huge corporation is such a sweet deal, write up a business plan, get some investors to back you, bust your ass for 10 or 20 years, go public, deal with shareholders, and enjoy your millions.

If it were easy, everyone would do it.

A hard-working and motivated individual has every opportunity to start his own small business, bring in a livable wage, and have something to sell or pass onto his kid(s) when he retires. Every OPPORTUNITY. No guarantees. Nothing risked, nothing gained.

Why go through all that trouble? Choose a couple of parents with the name "Kennedy" or "Hilton" or "of windsor" enjoy the money from birth...

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I don't have any claim either, but I believe their given money should be taxed just as hard as anyone who's working for their money...

How about all the money is sent to the federal government.  Then they can line their own pockets and distribute the rest to their powerless subjects?? 

 

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It's been pointed out in this thread, but those people are paying a plethora of taxes!

The disconnect between the general public's perceptions and the actual number of tax "loopholes" is quite large, based on what I see. Uncle Sam finds a way to get his share.

The one notable example of something resembling a loophole is hedge fund partners treating carried interest as a capital gain rather than ordinary income. But even this case is more complicated when one looks at the original intent of the tax code in not advantaging capital equity over sweat-equity in the case of partnerships.

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I don't have any claim either, but I believe their given money should be taxed just as hard as anyone who's working for their money...

Pfft......so u work all your life to leave your kids a chunk of change, house, car, which you paid income taxes on and you want your kids to pay taxes on what you already paid taxes on? Gift and estate taxes are bad enough. Trust fund kids? It's an extension of the living persons wishes. What the fuck should the person creating the trust do? Give it to a charity? Taxes r paid on dividends within a trust by the trust.

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Lol I can't wait to be in the 10% and look down upon the rest of you and use all the money I save in taxes to wipe my ass with

FWIW the owner and CEO of my company makes about 5x more than I do and is taxed 8.5x more than I am. That's only his personal income too, doesn't even begin to describe the amount of taxes incurred because of the company.

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Or, instead of inheriting a lump sum of cash, You could just borrow half a million dollars from your dad's slush fund, and invest it... Sidestepping taxes on income, and instead be taxed at the capital gains rate which is not to exceed 15%

 

seems easier than actually building a business and working.

 

ohh look, what a coincidence... yahoo running a story on the front page regarding the waltons (of walmart fame) and specifically how they have sucessfully dodged a number of taxes...

 

http://finance.yahoo.com/news/wal-marts-waltons-maintain-billionaire-040100941.html

Edited by magley64
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So you think it's proper that people making millions pay a lower effective tax rate than you and I?

 

People making millions pay MUCH more in taxes that you and I.

 

When you say "lower effective tax rate,"  I assume you are still stuck on the concept of capital gains tax.  Private investing drives our economy FAR more than taxes.  I would rather have private citizens investing wisely than the federal government mismanaging even more tax dollars. 

 

As I've already explained once in this thread "If you raise capital gains, you are basically eliminating some of the incentive for investors to invest in stocks, funds, etc.  Investors would pull (some) funds out of the stock market, risking another recession, or worse."

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People making millions pay MUCH more in taxes that you and I.

 

When you say "lower effective tax rate,"  I assume you are still stuck on the concept of capital gains tax.  Private investing drives our economy FAR more than taxes.  I would rather have private citizens investing wisely than the federal government mismanaging even more tax dollars. 

 

As I've already explained once in this thread "If you raise capital gains, you are basically eliminating some of the incentive for investors to invest in stocks, funds, etc.  Investors would pull (some) funds out of the stock market, risking another recession, or worse."

 

So you think prudent investors would stop investing in successful businesses because they might be taxed the same for those incomes as for regular incomes?

 

and yes, I'm talking about the "effective rate" which is the "bottom line". (you made 40,000, you paid $8,000 or 20%) or (you made 10,000,000, you paid 1,500,000 or 15%)

 

yes 1,500,000 is more than 8,000, but 20% is still more than 15%

 

You don't think it's a little messed up that some peoples income types are taxed less than other people's income types?

 

ESPECIALLY those who actually "work" for their money being taxed at a much higher rate than those who just happen to bet on the right horses? Or were lucky enough to be born into the right family?

Edited by magley64
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