this post was submitted on 20 Jun 2024

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The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax (www.propublica.org)

submitted 6 months ago by return2ozma to c/news

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[–] Makeitstop 5 points 6 months ago* (last edited 6 months ago)

Seems like the first step should be taxing those personal loans that are being used as income. That seems like a simple fix (simple by tax code standards, I'd still expect such a law to be ridiculously complex).

I do worry about the unintended side effects a of a wealth tax targeting stock ownership directly. That just gives the rich an incentive to squeeze more value out of their investments in order to cover their tax bill. And it seems like it would likely push private companies into selling out more as they grow since the money has to come from somewhere, thus giving even more incentive to cave in to investors who just want to make a quick buck and don't care about the long term survival of the company.

[+] Eheran -19 points 6 months ago (4 children)

... By not having an income?

pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.

What is this garbage? If I own a house/gold/collectable/toilet paper during covid/... and the value goes up, am I supposed to pay taxes? Do I get money back if the value goes down again? That is no income. It really is that simple. Yes, we still need to find a way do deal with this.

[–] tburkhol 30 points 6 months ago (1 children)

Corporations with marketable securities or hedges have to adjust their value every quarter, known as marking to market, and declare the change as income. Price goes up, they pay tax; price goes down, they get credit. It's a huge pain, and it would be tough for us mere mortals to do, every quarter or every year, on $1000 of TSLA, but it seems pretty reasonable to apply to individuals with 8-figure portfolios.

[–] Eheran -2 points 6 months ago

Yes, no question.

[–] decerian 15 points 6 months ago (1 children)

What is this garbage? If I own a house/gold/collectable/toilet paper during covid/... and the value goes up, am I supposed to pay taxes?

Yes, you are supposed to pay taxes on that (or on the house specifically). It's called property taxes.

If the value goes up, you pay more taxes the next year, if the value goes down you pay less.

[–] justdoitlater 9 points 6 months ago

You really didnt read the article right?! Because they explained exactly that: one way they avoid taxes is buy borrowing money giving the stocks as collateral... the interest they pay is way lower than the taxes they would have paid...

[–] [email protected] 6 points 6 months ago

If my house goes up in value, then my property tax goes up as well. So yes.