(04-27-2024, 11:52 AM)InvalidContentWasFoundStarting Wrote:

(04-27-2024, 11:12 AM)mikesez Wrote: 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.

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