OT - Is this representative of US public opinion? UK Newspaper Front Page

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Doug Winterburn wrote:

Therein lies the disagreement. I would measure "fair share" by the percentage of TRUE gross income that is paid in taxes paid by _each_ person, not by the whole group. The document you guys are wavnig around does NOT measure true income. Furthermore, it says rich people pay most (or a big chunk) of the taxes that are collected, and not anything else. The statistic is meaningless.
--
gabriel

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On Thu, 22 Jan 2004 20:23:05 +0000, gabriel wrote:

So you think taxes should be calculated on gross income rather than net income? You don't like the thought of more people being more successful? I suppose that if it showed the rich paid a small fraction of all income tax, it would be meaningful? The point _was_ that as you say, "rich people pay most (or a big chunk) of the taxes that are collected". I find that very meaningful.
-Doug
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Doug Winterburn wrote:

No. I'd like to see how much rich people loopholed off and hid before getting to the taxable wages line on their returns.
This is almost impossible to do, since rich people do not want tnyone to know, and I read the IRS itself is having trouble finding out the true gross income of really rich people. Think of this a a pipe dream of mine.

Hell, I did not bring up that figure. All I have been saying is that the figure is irrelevant! It does not prove or disprove anything! If you don't bring it up again, I will not either!
If you get another information source that states the top 50% of earners pay 90% or all collected taxes, it is still irrelevant.

It might be meaningful to you, but it's irrelevant to the topic. The discussion has been about the rich paying their fair share or not.
By the way, define "rich"... Would you say "rich" means top 1% or 40%? That's one of the problems of looking at these charts, one tends to read too much into them because the information it's not the right information.
BOTTOM LINE
Maybe I better take a moment to restate what I have been arguing about: I do not believe that rich people paty their fair share of taxes, and I believe tax breaks to the rich are neither deserved, nor are they so beneficial as to be worth gettnig the federal government into huge debt.
I define "rich" as individuals who have the ability to take advantage of the loopholes in tax law that allows those people to significantly obfuscate the true financial figures, such as creating non-profits that exist for the sole purpose of benefiting themselves or their families, or setting up corporate or similar entities that allows them to indefinitely delay reporting earnings, etc...
I know people that make ample use of such structures and schemes... All legal, of course, and all apalling if you know that someone who makes $5M a year only reported $300K.
--
gabriel

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On Thu, 22 Jan 2004 21:09:45 +0000, gabriel wrote:

What verifiable facts can you provide to substantiate this, or is just a gut feeling? You are aware that tax cuts have resulted in substantially increased tax revenue the two times they have been implemented under Kennedy and Reagan. Unfortunalely in Reagan's case spending tripled and revenue only doubled. As far as who is deserving, I find that government comes up short, not taxpayers.

Some would say a millionaire is rich. A millionaire refers to net worth and it isn't very difficult for average joe accumulate a net worth of $1 million or more through home equity and 401K's and IRA's. Income and net worth are two very different things. I have been in the top 5% of wage earners during my career and my tax preparer was never able to find all these loopholes you speak of.

The only way I can think of that this could happen is for someone to be granted stock options, which are not income until exercised. When exercised, the piper will be paid - believe me, I know. In fact, some of those nasty dot com undeserving rich folks exercised options, kept the stock rather than immediately selling, got taxed on the paper gains and had the bottom drop out of the stock price. Perhaps you could enlighten me on how anyone can legally not report true income and point to one verifiable case.
-Doug
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Doug Winterburn wrote:

I have seen articles in magazines (Newsweek and Businessweek mainly) and newspapers that talk about the loopholes available, the people who take advantage of them, and the people who create them. For example, some non-profits can refrain from naming names, so the IRS cannot link some people to hidden income.

Hey, no argument there... I am very willing to pay my own fair share. In fact, I would raise taxes right now, not lower them. For example, I would consider the state of the SS system as cause enough for some temporary pain in the form of higher taxes. OTOH, I would scrap the new manned mission to Mars initiative because the cost would be tremendous and the ROI would be too small (national gloating rights?, Let's fix health care first, no?).

Well, that;s the problem in this too-long debate... We don;t even know who we are talking about. I don't mean that to reflect badly on you or anyone else, but rather to stress how complex things get, where you can't even get past defining the problem, much less get to solving it.

Yeah, get a better accountant. By the time you prepare the taxes it's too late. You need to do it ahead of time, set up the right entities (corporations, funds, etc...). There's a reason they're called loophole "artists."

Nah, you can set up a fund, or a c-corp that "holds" money until later. For example, you make $2M, but you need only $500K to live confortably... So you take $500K in paychecks direct to you, the rest goes to the corp. The corp pays 8% tax when it gets the $1.5M (much less than you would pay), and then you do your investments through the corp, using the $1.5 from the corp, but never putting directly in your name. when you buy your $200K Bentley, the corp buys it for your use, for example. Then you hire a good loophole artist that will maximize this scheme (and exploit other schemes as well, all legal) so that you only take as little as possible in your name (and in your income tax rate). At the end of the day, you directly own nothing, but control everything, and earn _very_ little in your name. Of course, you only made $500K to the IRS eye, even though the real number was $2M.
--
gabriel

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On Thu, 22 Jan 2004 22:07:39 +0000, gabriel wrote:

I'm afraid the federal and state corporate tax rates are a touch higher than 8%:
http://www.meocpa.com/corprate.html http://www.taxadmin.org/fta/rate/corp_inc.html
Near as I can tell, you'd be paying up to 44% depending on the State.
-Doug
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Doug Winterburn wrote:

Whatever... The point was not to give exact figures, but to show how income can be hidden and "buffered" by using several corps of different types (ie, a c-corp with a july-june fiscal year, an s-corp with a jan-dec fiscal year, a fund, etc...).
The whole point was not to show that corp taxes are lower or higher, it was to show that money can be shifted around so as to bypass some or all taxation.
--
gabriel

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gabriel writes:

Leave us not forget, too, that Bush is going to help us fix our marriages, to the tune of 1-1/2 billion of our own bucks.
I doubt we can fix health care for the 16 billion aimed at Mars, but we don't need to piss those bucks into space, either. Nor do we need to supply Iraq with 87 billion dollars to rebuild the country. Let them pay Halliburton with their own revenues.
Charlie Self "Character is much easier kept than recovered." Thomas Paine
http://hometown.aol.com/charliediy/myhomepage/business.html
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Charlie Self wrote:

I heard on a radio show that bush did not bring up Mars for several reasons at the state of the union address, but one was that the total-total cost is estimated to be about $160B, not just the "get started" figure that has been publicized more.
That's a staggering cost. I cannot give you an official source for this figure, though, so take it with a grain of salt.
--
gabriel

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reasons
is
Like father, like son. His old man did *exactly* the same thing ten or so years ago. Made a big splash with a plan to go to Mars then never mentioned it again when the price tag became known. Striking, isn't it.
Dennis Vogel
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snipped-for-privacy@yahoo.com says...

Doug,
    You're getting muddy.

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On Fri, 23 Jan 2004 03:54:27 +0000, Mark & Juanita wrote:

I know, I'll try to wash if off :-)
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It's supposed to be that way. Our tax system is designed to be progressive.
Dennis Vogel
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    Greetings and Salutations.
On Thu, 22 Jan 2004 18:37:16 GMT, Doug Winterburn

    Well, many numbers there. I have a few thoughts, though.     0) Cash to a politician is like crack to an addict. There is never enough of it, and, they WILL sell their sister or mother into prostitution to get more of it.     1) To them that much has been given, of them, much will be required.     2) If a class of people is acquiring 90% of the total income, is it not fairer that they pay 90% of the taxes.     Regards     Dave Mundt
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Dave Mundt responds:

Not to that class. It's a "burden." I've got a somewhat different point of view, having been up and down on the scale. It is obviously a higher percentage of one's income if you pay 100 grand in taxes on 250K than if someone pays 2 grand on 10K.
For the hell of it, just work at who is having a bigger problem paying his bills.
Fairness may or may not enter into it, but the fact is, 40% taxation of someone in the higher brackets (where taxes are also more easily avoided, anyway) is LESS of a real burden than is 20% taxation of someone in the lower brackets.
Damned few poor people can buy tax shelters.
Charlie Self "Character is much easier kept than recovered." Thomas Paine
http://hometown.aol.com/charliediy/myhomepage/business.html
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On Fri, 23 Jan 2004 19:48:38 +0000, Charlie Self wrote:

If the above numbers are take home amounts, the federal income tax on $10K would be $127 for single and $[4010] for married with 2 kids. In other words, the married with 2 kids gets back $4010 more than what he paid in because of the EIC.
-Doug
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On Fri, 23 Jan 2004 23:09:32 +0000, Doug Winterburn wrote:

That should be he get back all he paid in plus $4010.
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Doug Winterburn wrote:

Have you tried living with 2 kids on $14K? these people are not Exactly taking European vacations...
Anyway, 4-person American families taking home $10K a year is hardly exemplary of anything except extreme poverty.
--
gabriel

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On Fri, 23 Jan 2004 23:27:09 +0000, gabriel wrote:

It indicates some very poor decision making. Perhaps they should get back $40K in EIC so they can be real motivated to do better? And maybe more kids as EIC goes up with more kids.
-Doug
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Doug Winterburn writes:

Nonsense. How do you know WHY that particular person might be making 10K or 14K? Decision making may well not enter into it.
Charlie Self "Character is much easier kept than recovered." Thomas Paine
http://hometown.aol.com/charliediy/myhomepage/business.html
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