Eye Opening Article on Taxes

#127
#127
rjd970 said:
Depends on how much I make.

Even you can agree with that.
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Exactly.....you are only taxed if you earn income......not when you are "given" money......the money you EARN is taxed not just for being luck enough to be born an American or have a parent that worked hard and was able to leave you some assets
 
#128
#128
rjd970 said:
So your parents wealth is or isn't luck? Pray tell.
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No clue if they have any money or not. They tend to travel a lot so they may be spending it all. I may end up paying for their funerals out of pocket, which I would consider bad luck. Then again, they may have a fortune tucked away which I would consider good luck. It would be even better luck if that fortune was in a bank in the Caymen Islands so it wouldn't be such good luck for the US government.
 
#130
#130
T-TownVol said:
Exactly.....you are only taxed if you earn income......not when you are "given" money......the money you EARN is taxed not just for being luck enough to be born an American or have a parent that worked hard and was able to leave you some assets
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I disagree. You should be taxed on given money. That is why all the folks on welfare pay so much in taxes. Uh, crap, no they don't. So it is only the people lucky enough to have enough means to pay taxes who would have to pay taxes. Also, those super lucky people who have their money in different assets or hidden overseas can skip the taxes as well, so really it is just a median amount of luck necessary to keep the government happy.
 
#131
#131
T-TownVol said:
Exactly.....you are only taxed if you earn income......not when you are "given" money......the money you EARN is taxed not just for being luck enough to be born an American or have a parent that worked hard and was able to leave you some assets
Click to expand...

I am going to preface this to avoid confusion on your part...

GIVEN THE CURRENT SYSTEM I DON'T AGREE WITH:

If earned income, gained by working and making smart decisions is taxed, then absolutely income gained by it being dropped in your lap should be taxed. The rational is backwards as it stands. We are punishing work, and rewarding the circumstances we had no control over.
 
#133
#133
utvolpj said:
so every wealthy person was that way before they had kids?
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No.

Say your parents are massively rich. How did you have anything to do with that? You're lucky. Good for you. Whether they were rich before they had you or got that way during your life, is irrelevant. Unless you were the breadwinner (kid actor, whatever) you had nothing to do with it and you didn't earn any of it.
 
#134
#134
rjd970 said:
I am going to preface this to avoid confusion on your part...

GIVEN THE CURRENT SYSTEM I DON'T AGREE WITH:

If earned income, gained by working and making smart decisions is taxed, then absolutely income gained by it being dropped in your lap should be taxed. The rational is backwards as it stands. We are punishing work, and rewarding the circumstances we had no control over.
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And no one here agrees with you except LG.....enough said.
 
#135
#135
rjd970 said:
No.

Say your parents are massively rich. How did you have anything to do with that? You're lucky. Good for you. Whether they were rich before they had you or got that way during your life, is irrelevant. Unless you were the breadwinner (kid actor, whatever) you had nothing to do with it and you didn't earn any of it.
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my brother in law's family owns a business that was pretty small when he graduated college. He took over their IT/ops part of the business and through his automation/efficiency efforts has increased their sales/distribution 10 fold in the last decade. I assume you would also say he was lucky and had nothing to do with increasing the wealth of his parents?
 
#136
#136
utvolpj said:
my brother in law's family owns a business that was pretty small when he graduated college. He took over their IT/ops part of the business and through his automation/efficiency efforts has increased their sales/distribution 10 fold in the last decade. I assume you would also say he was lucky and had nothing to do with increasing the wealth of his parents?
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don't deal with reality pj, it is not welcome here
 
#137
#137
utvolpj said:
my brother in law's family owns a business that was pretty small when he graduated college. He took over their IT/ops part of the business and through his automation/efficiency efforts has increased their sales/distribution 10 fold in the last decade. I assume you would also say he was lucky and had nothing to do with increasing the wealth of his parents?
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As I said, unless they (benefactor of the inheritance) had anything to do with it, it is luck they get what they do.

Still doesn't change the fact that the circumstances one is born into is nothing but luck. Some make more out of their circumstances, some make less. Some parents are smart, work hard, and save. Some don't. But we have no control over the starting point. Luck deals us the cards, we play them the best we can.
 
#138
#138
rjd970 said:
No.

Say your parents are massively rich. How did you have anything to do with that? You're lucky. Good for you. Whether they were rich before they had you or got that way during your life, is irrelevant. Unless you were the breadwinner (kid actor, whatever) you had nothing to do with it and you didn't earn any of it.
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Well, unless you consider the cost of care and feeding your kids in the mix. I mean, if I'm bailing my kid out of jail 2-3 times a year and having to pay for rehab it may bite into his inheritance a bit. On a less dramatic note, if he breaks things, tears up his stuff and is destructive to my property, it is my fortunes that will pay--not to forget the time away from work dealing with his issues. On the other hand, if he stays out of trouble and keeps his stuff in order so I'm not replacing his stuff all the time, there is a chance I can concentrate on work, build up a bit of savings and pass something on to him. I think kids have a direct impact on the parent's ability to build their fortune. I really do not think it is truly lucky unless it is one of those long lost uncle situations.
 
#139
#139
We are going to have to agree to disagree. I honestly have to much to do at work today to continue this. Minus T-Town's snide and unsuccessful attmepts at humor, I enjoyed it.

Later fellas.
 
#140
#140
rjd970 said:
We are going to have to agree to disagree. I honestly have to much to do at work today to continue this. Minus T-Town's snide and unsuccessful attmepts at humor, I enjoyed it.

Later fellas.
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:hi:, I do not get paid to be funny, the snide is just "luck" on your part
 
#141
#141
rjd970 said:
As I said, unless they (benefactor of the inheritance) had anything to do with it, it is luck they get what they do.

Still doesn't change the fact that the circumstances one is born into is nothing but luck. Some make more out of their circumstances, some make less. Some parents are smart, work hard, and save. Some don't. But we have no control over the starting point. Luck deals us the cards, we play them the best we can.
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That shouldn't matter. It wasn't luck that originally earned the money. The person who earned it deserves the right to pass it on without getting raped. These taxes diminish the incentive to earn and undermine the market. You may be tempted to spend now instead of passing the money on because of egregious inheritance taxes. Market mechanisms may be calling for savings for future production, but you don't care because you are facing artificial incentives.
 
#142
#142
On Assets vs Income: If I inherit stock, the stock has a market value but that value is not realized until I sell it. Taxing the market value at inheritance and then again at selling (when it becomes realized income) is clearly double taxations. In short, assets are not income until assets are sold.

On Taxing Interest, Cap Gains, etc. as Regular Income: There is a very good reason to tax these lower than regular income. It encourages investment - the enhanced "keepability" of returns encourage productive use of financial assets which drives economic growth overall. Likewise, growth of financial assets means individuals will rely less on the government for benefits. It is a win-win that reduces both the need for government spending and grows government revenue by encouraging larger economic growth and thus a larger tax base.

Financial assets have the ability to grow more wealth more quickly than does adding additional units of labor. Put another way, if a high marginal income tax rate discourages additional hours of work; income is sacrificed. If high dividend, cap gains, int income tax rates prevent additional risk-based investment then you not only lose the investment at time "x" but you also lose the compounding effect of growing an asset.

I'd say it would be hard to find many economists that believe investment income should be taxed at the same rates as income unless they are advocating some type of flat tax system rather than our current marginal rate based system.
 
#143
#143
rjd970 said:
I am going to preface this to avoid confusion on your part...

GIVEN THE CURRENT SYSTEM I DON'T AGREE WITH:

If earned income, gained by working and making smart decisions is taxed, then absolutely income gained by it being dropped in your lap should be taxed. The rational is backwards as it stands. We are punishing work, and rewarding the circumstances we had no control over.
Click to expand...

I understand what you are saying. It is clear that you do not favor these taxes. I just happen to disagree with you about whether inheritance is indeed income. I think it is not, you think it is. Inheritance is a money transfer and not an economic exchange. To me, income is monies realized from the exchange of goods or services. A money transfer is not the result of such an exchange, and is therefore not income.

About your tax philosophy, I agree with parts of it. I think we should not discourage work or investment by taxing it. I also do not think we should tax inheritance because it discourages the accumulation of wealth or assets.

If it were up to me, we would only have usage taxes. Ie, if you drive, you pay a tax per mile. If you send your kid to school, you pay tuition. If you want the fire dept to come to your house, you pay a yearly access fee. Et cetera. Let each person pay for what they use. It is not fair to tax me to pay for your benefits.

Property taxes are evil. 'Give us a cut of what your stuff is worth or we will take it from you and/or physically harm you.' Sounds like something the mafia would say doesn't it?

Income taxes are a form of slavery. A certain amount of the work I do is for someone else's benefit and I am not compensated for that work. From the beginning of the year, until I meet my tax burden, I am effectively a slave. My only choice to not be a slave is to refuse to work.

Sales taxes are just straight up theft. They just take 10% of my money away from me when I try to spend it. Consider how much more goods we could consume and jobs we could create if we all had 10% more disposable income.

Capital gains taxes discourage investment and encourage consumption. Consumption without investment results in dissipation. Investment creates jobs and results in newer, better products. It is a win/win. We should never discourage it.
 
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