Why the hell does the Government feel entitled to almost 50% of your return on an investment????? They didn't take the risk, investors did..........

Biden's capital gains tax proposal could crush the economy, experts say

'These are the really dangerous Biden proposals,' Americans for Tax Reform economist says

President Biden's latest proposal to hike the top capital gains tax rate to its highest level in more than a century is facing heavy criticism from experts who warn such an action could significantly harm the U.S. economy.

According to a report issued by the Treasury Department, led by Secretary Janet Yellen, the president's proposed fiscal year 2025 budget would increase the top marginal rate on long-term capital gains and qualified dividends to a staggering 44.6%. A capital gains tax hike of that magnitude would take the rate to its highest level since it was first introduced in the early 1920s.

https://www.foxnews.com/politics/bidens-...xperts-say

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I think Mikesez is wishing death on the wrong people lolol

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They downplayed it by stating that a President's budget is more aspirational and symbolic than anything and that the likelihood of it passing with Republicans currently in control of congress is next to 0, however, we still have a President essentially virtue signaling to socialists and communists. That's a problem and an indictment on where we are as a country.

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Capital gains (after inflation) and dividends should be treated as ordinary income.

Anything else is games or rent seeking.

If the top marginal rate (including Medicare and Medicaid and surtaxes) on ordinary income is 44% then the top marginal rate for inflation adjusted capital gains and dividends should also be 44%. The reason is, if you're wealthy and can afford to defer your income, you will hide your actual income by creating one shell corporation and then selling it to another shell corporation endlessly, and everything gets counted as capital gains with a discounted rate. It's wrong and it needs to stop.

That said, 44% is high and that rate should be lowered, as long as all income was treated equally.

The idea that a discount on investment taxes, over and above an inflation adjustment, causes economic growth is unproven and unlikely.

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My fellow southpaw Mark Brunell will probably always be my favorite Jaguar.

Capital gains (after inflation) and dividends should be treated as ordinary income.

Anything else is games or rent seeking.

If the top marginal rate (including Medicare and Medicaid and surtaxes) on ordinary income is 44% then the top marginal rate for inflation adjusted capital gains and dividends should also be 44%.  The reason is, if you're wealthy and can afford to defer your income, you will hide your actual income by creating one shell corporation and then selling it to another shell corporation endlessly, and everything gets counted as capital gains with a discounted rate.  It's wrong and it needs to stop. 

That said, 44% is high and that rate should be lowered, as long as all income was treated equally.

The idea that a discount on investment taxes, over and above an inflation adjustment, causes economic growth is unproven and unlikely.

Do you agree that the movement of money stimulates the economy?

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When you get into the endzone, act like you've been there before.

Why the hell does the Government feel entitled to almost 50% of your return on an investment????? They didn't take the risk, investors did..........

Agree

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Capital gains (after inflation) and dividends should be treated as ordinary income.

Anything else is games or rent seeking.

If the top marginal rate (including Medicare and Medicaid and surtaxes) on ordinary income is 44% then the top marginal rate for inflation adjusted capital gains and dividends should also be 44%.  The reason is, if you're wealthy and can afford to defer your income, you will hide your actual income by creating one shell corporation and then selling it to another shell corporation endlessly, and everything gets counted as capital gains with a discounted rate.  It's wrong and it needs to stop. 

That said, 44% is high and that rate should be lowered, as long as all income was treated equally.

The idea that a discount on investment taxes, over and above an inflation adjustment, causes economic growth is unproven and unlikely.

Do you agree that the movement of money stimulates the economy?

Real movement of money for real goods and real services doesn't just stimulate the economy, it is the economy.

Shell corporations and accounting gimmicks are not.

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My fellow southpaw Mark Brunell will probably always be my favorite Jaguar.

Do you agree that the movement of money stimulates the economy?

Real movement of money for real goods and real services doesn't just stimulate the economy, it is the economy.

Shell corporations and accounting gimmicks are not.

Great, you understand how critical the movement of money is.  Now, do you understand that higher net returns make investors more likely to sell property, thereby moving money (the economy) PLUS those sales not only generate other associated fees and taxes beyond capital gains (doc stamp tax, property transfer tax, recording fees, etc.) but also typically require peripheral actions that also move money (appraisals, inspections, surveys, etc.)?

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When you get into the endzone, act like you've been there before.

Real movement of money for real goods and real services doesn't just stimulate the economy, it is the economy.

Shell corporations and accounting gimmicks are not.

Great, you understand how critical the movement of money is.  Now, do you understand that higher net returns make investors more likely to sell property, thereby moving money (the economy) PLUS those sales not only generate other associated fees and taxes beyond capital gains (doc stamp tax, property transfer tax, recording fees, etc.) but also typically require peripheral actions that also move money (appraisals, inspections, surveys, etc.)?

Yes, but if you're going to lower taxes to stimulate economic activity, lower them on wages as well.  Those wages not only generate good feelings but also generate taxes beyond like sales tax, gas tax, and bed tax when the happy worker spends his extra money and goes on vacation.

Just treat income as income.  That's all I'm saying.

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My fellow southpaw Mark Brunell will probably always be my favorite Jaguar.

(Apologies for the formatting)

I'm going to break this up into several posts so I don't hit everybody over the head with BIG WALL OF TEXT
I'm using 2022 figures ... because ... well ... OK, I know the deadline was two weeks ago, shut up.

If someone says they're in the 22% tax rate that doesn't mean they pay 22% on ALL of their income.
We have a graduated tax system.

Filing Status: Single
IF YOUR 2022 TAXABLE INCOME IS:
OVER  BUT NOT OVER  THE TAX IS  OF THE AMOUNT OVER
  0        10,275              10%              0
10,275    41,775        1,027.50 + 12%    10,275
41,775    89,075        4,087.50 + 22%    41,775
89,075    170,050        15,213.50 + 24%    89,075
170,050    215,950        34,647.50 + 32%    170,050
215,950    539,900        49,335.50 + 35%    215,950
539,900 and up          162,718.00 + 37%    539,900

SO IF YOU WERE SINGLE AND HAD $1,000,000 IN TAXABLE INCOME:
  You would pay 10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  Then you would pay 12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  Then you would pay 22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  Then you would pay 24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  Then you would pay 32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  Then you would pay 35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  Then you would pay 37% (170,237) on the chunk of Taxable Income between 539,901 and 1,000,000.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 170,237 = 332,955
or just over 33% of the $1,000,000

NOTE: Taxable Income is NOT the same as Adjusted Gross Income.
      Taxable Income = Adjusted Gross Income minus Sch A Deductions (or Standard Deduction).
      Historically, Exemptions were also subtracted from AGI to reach Taxable Income.
      However Exemptions were temporarily deprecated by TCJA in lieu of nearly doubled Std Ded.

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Now let's do the same thing for Capital Gains income

Filing Status: Single
IF YOUR 2022 TAXABLE INCOME IS CAPITAL GAINS AND IS:
OVER  BUT NOT OVER  THE TAX IS  OF THE AMOUNT OVER
  0        41,675              0%              0
41,675    459,750              15%          41,675
459,750 and up            62,711.25 + 20%    459,750
SO IF YOU WERE SINGLE AND YOUR $1,000,000 TAXABLE INCOME WAS ALL CAPITAL GAINS:
  You would pay 0% tax (0) on the chunk of capital gains between 0 and 41,675.
  You would pay 15% (61,711.25) on the chunk of capital gains between 41,676 and 459,750.
  You would pay 20% (108,050) on the chunk of capital gains between 459,751 and 1,000,000.
For a TOTAL TAX of 0 + 61,711.25 + 108,050 = 169,761.25 or almost 17% of the $1,000,000

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Now I'm already an hour into this thing and I haven't made my point yet.
So for the figures below I am only going to use the 2022 tax rates and Standard Deduction
I am just trying to make a point so I AM NOT ABOUT to do what I did above for 2018 - 2021

Now the above examples were using $1,000,000 and those examples seem to indicate a very favorable Capital Gains tax rate.
But let's illustrate a more realistic example.

Let's say I made 56,316 per year (2022 national average) in wages each year 2018 - 2022 (5 years)
Let's say your only income for the 2018 - 2022 was a (56,616 x 5 =) 281,580 capital gain received in 2022
So we both received the exact same amount during the 5 yr period but you got yours all at one time
All else equal

So my Taxable Income would be 56,316 (Wages) minus 12,950 (2022 Standard Deduction)
= 43,366 Taxable Income for each of the five years

Since wages are Ordinary Income the taxes I would owe would be:
    10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275
    12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775
    22% (1,590) on the chunk of Taxable Income between 41,776 and 43,366
Total tax per year = 1,027.50 + 3,780 + 1,590 = 6,397.50
x 5 years = 31,987.50 total taxes owed over the last five years

You would have no Taxable Income for 2018 - 2021
Your Taxable Income for 2022 would be 281,580 - 12,950 (Std Ded) = 268,630
You only get the benefit of one year's worth of Std Ded because all of your income is taxed the year you receive it.

Using the Capital Gains Tax Rate, the taxes you would owe would be:
    0% tax (0) on the chunk of capital gains between 0 and 41,675
    15% (34,043) on the chunk of capital gains between 41,676 and 268,630
For a grand total of 34,043 in taxes owed for the last 5 yrs.
About 2,000 MORE THAN me for the same amount of income.


So Capital Gains tax rate is NOT necessarily more favorable that the Ordinary Income tax rate.

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Now I'm already an hour into this thing and I haven't made my point yet.
So for the figures below I am only going to use the 2022 tax rates and Standard Deduction
I am just trying to make a point so I AM NOT ABOUT to do what I did above for 2018 - 2021

Now the above examples were using $1,000,000 and those examples seem to indicate a very favorable Capital Gains tax rate.
But let's illustrate a more realistic example.

Let's say I made 56,316 per year (2022 national average) in wages each year 2018 - 2022 (5 years)
Let's say your only income for the 2018 - 2022 was a (56,616 x 5 =) 281,580 capital gain received in 2022
So we both received the exact same amount during the 5 yr period but you got yours all at one time
All else equal

So my Taxable Income would be 56,316 (Wages) minus 12,950 (2022 Standard Deduction)
= 43,366 Taxable Income for each of the five years

Since wages are Ordinary Income the taxes I would owe would be:
    10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275
    12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775
    22% (1,590) on the chunk of Taxable Income between 41,776 and 43,366
Total tax per year = 1,027.50 + 3,780 + 1,590 = 6,397.50
x 5 years = 31,987.50 total taxes owed over the last five years

You would have no Taxable Income for 2018 - 2021
Your Taxable Income for 2022 would be 281,580 - 12,950 (Std Ded) = 268,630
You only get the benefit of one year's worth of Std Ded because all of your income is taxed the year you receive it.

Using the Capital Gains Tax Rate, the taxes you would owe would be:
    0% tax (0) on the chunk of capital gains between 0 and 41,675
    15% (34,043) on the chunk of capital gains between 41,676 and 268,630
For a grand total of 34,043 in taxes owed for the last 5 yrs.
About 2,000 MORE THAN me for the same amount of income.


So Capital Gains tax rate is NOT necessarily more favorable that the Ordinary Income tax rate.

I'm not going to check the math but I agree that it sounds correct.

The typical scheme is two years though, not five.  Pretty sure the discount gets significant in the two year scenario.

---

My fellow southpaw Mark Brunell will probably always be my favorite Jaguar.

However, if your 268,630 Capital Gain was taxed as Ordinary Income
then your 2022 taxes would be:

      You would pay 10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
      Then you would pay 12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
      Then you would pay 22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
      Then you would pay 24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
      Then you would pay 32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
      Then you would pay 35% (18,437.65) on the chunk of Taxable Income between 215,951 and 268,630.

For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 18,437.65 = 67,773.15.
MORE THAN TWICE what I paid for the SAME amount of income.

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Now I'm already an hour into this thing and I haven't made my point yet.
So for the figures below I am only going to use the 2022 tax rates and Standard Deduction
I am just trying to make a point so I AM NOT ABOUT to do what I did above for 2018 - 2021

Now the above examples were using $1,000,000 and those examples seem to indicate a very favorable Capital Gains tax rate.
But let's illustrate a more realistic example.

Let's say I made 56,316 per year (2022 national average) in wages each year 2018 - 2022 (5 years)
Let's say your only income for the 2018 - 2022 was a (56,616 x 5 =) 281,580 capital gain received in 2022
So we both received the exact same amount during the 5 yr period but you got yours all at one time
All else equal

So my Taxable Income would be 56,316 (Wages) minus 12,950 (2022 Standard Deduction)
= 43,366 Taxable Income for each of the five years

Since wages are Ordinary Income the taxes I would owe would be:
    10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275
    12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775
    22% (1,590) on the chunk of Taxable Income between 41,776 and 43,366
Total tax per year = 1,027.50 + 3,780 + 1,590 = 6,397.50
x 5 years = 31,987.50 total taxes owed over the last five years

You would have no Taxable Income for 2018 - 2021
Your Taxable Income for 2022 would be 281,580 - 12,950 (Std Ded) = 268,630
You only get the benefit of one year's worth of Std Ded because all of your income is taxed the year you receive it.

Using the Capital Gains Tax Rate, the taxes you would owe would be:
    0% tax (0) on the chunk of capital gains between 0 and 41,675
    15% (34,043) on the chunk of capital gains between 41,676 and 268,630
For a grand total of 34,043 in taxes owed for the last 5 yrs.
About 2,000 MORE THAN me for the same amount of income.


So Capital Gains tax rate is NOT necessarily more favorable that the Ordinary Income tax rate.

I'm not going to check the math but I agree that it sounds correct.

The typical scheme is two years though, not five.  Pretty sure the discount gets significant in the two year scenario.

In order to qualify for Capital Gains tax treatment, the asset has to be held for at least a year so are you sure that two years is typical?

Either way, let's run the numbers for two years.

I would owe (6,397.50 x 2 =) 12,795 in taxes for 2 yrs of wages (56,616 per year)

And your taxable Capital Gain would be ([56,616 x 2] - 12,950 =) 100,282
Using the Capital Gains Tax Rate, the taxes you would owe would be:
    0% tax (0) on the chunk of capital gains between 0 and 41,675
    15% (8,790.90) on the chunk of capital gains between 41,676 and 100,282
For a grand total of 8,791 in taxes owed for the last 2 yrs
About 4,004 less than me for the same amount of income.

However if your 100,282 Capital Gains income was taxed at the Ordinary Income rate:
    You would pay 10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
    Then you would pay 12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
    Then you would pay 22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
    Then you would pay 24% (2,689.44) on the chunk of Taxable Income between 89,076 and 100,282.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 2,689.44 = 17,902.94
About 5,000 more than what I paid for the SAME amount of income.

That's why I agree with the fact that the Capital Gains rate should be more favorable than the Ordinary Income tax rate.

---

I'm not going to check the math but I agree that it sounds correct.

The typical scheme is two years though, not five.  Pretty sure the discount gets significant in the two year scenario.

In order to qualify for Capital Gains tax treatment, the asset has to be held for at least a year so are you sure that two years is typical?

Either way, let's run the numbers for two years.

I would owe (6,397.50 x 2 =) 12,795 in taxes for 2 yrs of wages (56,616 per year)

And your taxable Capital Gain would be ([56,616 x 2] - 12,950 =) 100,282
Using the Capital Gains Tax Rate, the taxes you would owe would be:
    0% tax (0) on the chunk of capital gains between 0 and 41,675
    15% (8,790.90) on the chunk of capital gains between 41,676 and 100,282
For a grand total of 8,791 in taxes owed for the last 2 yrs
About 4,004 less than me for the same amount of income.

However if your 100,282 Capital Gains income was taxed at the Ordinary Income rate:
    You would pay 10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
    Then you would pay 12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
    Then you would pay 22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
    Then you would pay 24% (2,689.44) on the chunk of Taxable Income between 89,076 and 100,282.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 2,689.44 = 17,902.94
MORE THAN TWICE what I paid for the SAME amount of income.

That's why I agree with the fact that the Capital Gains rate should be more favorable than the Ordinary Income tax rate.

Ok, but what if your yearly income was ten million dollars?

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My fellow southpaw Mark Brunell will probably always be my favorite Jaguar.

That's why I agree with the fact that the Capital Gains rate should be more favorable than the Ordinary Income tax rate.

Ok, but what if your yearly income was ten million dollars?

Oh that's right, I keep forgetting that you're a millionaire.

My hypothetical $10 mil per year:
$10 mil - Std Ded = $9,987,050 in Taxable Income taxed at the Ordinary rate:
  10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  37% (3,495,445) on the chunk of Taxable Income between 539,901 and 9,987,050.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 3,495,445
= 3,658,163 x 2 years
= 7,316,326 in TOTAL TAXES owed for the two year period.

Your $20 mil:
$20 mil - Std Ded = 19,987,050 taxed at Capital Gains Rate:
  0% tax (0) on the chunk of capital gains between 0 and 41,675.
  15% (61,711.25) on the chunk of capital gains between 41,676 and 459,750.
  20% (3,905,460) on the chunk of capital gains between 459,751 and 19,987,050.
For a TOTAL TAX of 0 + 61,711.25 + 3,905,460 = 3,967,171 in TOTAL TAXES owed for the two year period. 
A little more than half what I paid for the same amount of income.

But that's not my point.
If your $20 mil was taxed as Ordinary Income (which is what you said you wanted):
$20 mil - Std Ded = $19,987,050 in Taxable Income taxed at the Ordinary rate:
  10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  37% (7,195,445) on the chunk of Taxable Income between 539,901 and 19,987,050.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 7,195,445

= 7,358,163 in TOTAL TAXES owed for the two year period.

Not as egregious as the earlier example, but still about 40,000 more than my taxes

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Ok, but what if your yearly income was ten million dollars?

Oh that's right, I keep forgetting that you're a millionaire.

My hypothetical $10 mil per year:
$10 mil - Std Ded = $9,987,050 in Taxable Income taxed at the Ordinary rate:
  10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  37% (3,495,445) on the chunk of Taxable Income between 539,901 and 9,987,050.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 3,495,445
= 3,658,163 x 2 years
= 7,316,326 in TOTAL TAXES owed for the two year period.

Your $20 mil:
$20 mil - Std Ded = 19,987,050 taxed at Capital Gains Rate:
  0% tax (0) on the chunk of capital gains between 0 and 41,675.
  15% (61,711.25) on the chunk of capital gains between 41,676 and 459,750.
  20% (3,905,460) on the chunk of capital gains between 459,751 and 19,987,050.
For a TOTAL TAX of 0 + 61,711.25 + 3,905,460 = 3,967,171 in TOTAL TAXES owed for the two year period. 
A little more than half what I paid for the same amount of income.

But that's not my point.
If your $20 mil was taxed as Ordinary Income (which is what you said you wanted):
$20 mil - Std Ded = $19,987,050 in Taxable Income taxed at the Ordinary rate:
  10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  37% (7,195,445) on the chunk of Taxable Income between 539,901 and 19,987,050.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 7,195,445

= 7,358,163 in TOTAL TAXES owed for the two year period.

Not as egregious as the earlier example, but still about 40,000 more than my taxes

No my point is both people cleared $20 million in two years, one pays $7.3 million in taxes and the other pays $4.0 million because he funneled his money through a shell corporation and deferred taking it for at least 366 days.  I'm not saying the 2nd guy should pay $7.3 million.  I'm saying they should each pay the same amount, and that amount would probably be a number in between, say $5 million or $6 million.

---

My fellow southpaw Mark Brunell will probably always be my favorite Jaguar.

This is the kind of dialogue I appreciate but don't read. I just cannot get into economics, which sucks, because that's where the money's at.

---

Oh that's right, I keep forgetting that you're a millionaire.

My hypothetical $10 mil per year:
$10 mil - Std Ded = $9,987,050 in Taxable Income taxed at the Ordinary rate:
  10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  37% (3,495,445) on the chunk of Taxable Income between 539,901 and 9,987,050.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 3,495,445
= 3,658,163 x 2 years
= 7,316,326 in TOTAL TAXES owed for the two year period.

Your $20 mil:
$20 mil - Std Ded = 19,987,050 taxed at Capital Gains Rate:
  0% tax (0) on the chunk of capital gains between 0 and 41,675.
  15% (61,711.25) on the chunk of capital gains between 41,676 and 459,750.
  20% (3,905,460) on the chunk of capital gains between 459,751 and 19,987,050.
For a TOTAL TAX of 0 + 61,711.25 + 3,905,460 = 3,967,171 in TOTAL TAXES owed for the two year period. 
A little more than half what I paid for the same amount of income.

But that's not my point.
If your $20 mil was taxed as Ordinary Income (which is what you said you wanted):
$20 mil - Std Ded = $19,987,050 in Taxable Income taxed at the Ordinary rate:
  10% tax (1,027.50) on the chunk of Taxable Income between 0 and 10,275.
  12% (3,780) on the chunk of Taxable Income between 10,276 and 41,775.
  22% (10,406) on the chunk of Taxable Income between 41,776 and 89,075.
  24% (19,434) on the chunk of Taxable Income between 89,076 and 170,050.
  32% (14,688) on the chunk of Taxable Income between 170,051 and 215,950.
  35% (113,382.50) on the chunk of Taxable Income between 215,951 and 539,900.
  37% (7,195,445) on the chunk of Taxable Income between 539,901 and 19,987,050.
For TOTAL TAX of 1,027.50 + 3,780 + 10,406 + 19,434 + 14,688 + 113,382.50 + 7,195,445

= 7,358,163 in TOTAL TAXES owed for the two year period.

Not as egregious as the earlier example, but still about 40,000 more than my taxes

No my point is both people cleared $20 million in two years, one pays $7.3 million in taxes and the other pays $4.0 million because he funneled his money through a shell corporation and deferred taking it for at least 366 days.  I'm not saying the 2nd guy should pay $7.3 million.  I'm saying they should each pay the same amount, and that amount would probably be a number in between, say $5 million or $6 million.

Agreed, as do most of the citizens of America.  Yet the elected officials do see that a flat tax would be beneficial.  I wonder why?

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Original Season Ticket Holder - Retired  1995 - 2020


At some point you just have to let go of what you thought should happen and live in what is happening.