Why people get so upset about the Wealthy/15% tax

[rj.phila]

What's wrong with not paying high taxes?

I have a 401K and a Roth IRA to lessen my tax burden. I own several tax advantaged funds to lessen my tax burden. I don't think that there is anything wrong with that.

At what point do we say that for certain people it is ok but for others it is not? If Joe sixpack can do it, then why can't Joe millionare? What is the cutoff point?

we're not debating whether people should take advantage of the current tax system. we're debating why that tax system is the way it is. in your words, we're saying joe millionaire shouldnt have been legally allowed to do it in the first place, not that he shouldnt have done it.

photo-are you saying you were disadvantaged in that top bracket when you say "uncle sam was squeezing, let me tell you"? im in that bracket every year. if someone in that bracket is bitching about their tax burden, its cause they either arent smart with their money(unlikely if they got there in the first place), or they just want preferential treatment. i dont see any way around that.


steve-you're absolutely right.

[bjl584]

"High" is a relative term. The current tax levy is at historic lows.

Nothing is wrong w/ paying low taxes, as long as you don't mind large deficits.

Is Government too big? Does the government spend recklessly and foolishly on way too may ventures?

I think that is a bigger problem than low tax rates.

[feh]

Is Government too big? Does the government spend recklessly and foolishly on way too may ventures?

That's a tangential discussion I'd rather not enter right now.

I think that is a bigger problem than low tax rates.

At the current rates, we have a structural deficit. Even in good economic times we will be in the red. Rates need to be raised to correct it.

[bjl584]

we're not debating whether people should take advantage of the current tax system. we're debating why that tax system is the way it is. in your words, we're saying joe millionaire shouldnt have been legally allowed to do it in the first place, not that he shouldnt have done it.

I think that's where the argument is going. "I don't like the rules, so let's change them so that people will stop doing it the current way."

There are tax breaks everywhere for pretty much anyone to take advantage of. It will never be a level playing field, but that is the very nature of Capitalism. There are winners and there are losers. Some will do better than others. Some will have more options and advantages than others. Does it really matter to a multi-millionare what the capital gains tax rate is? Probably not. He will still be a multi-millionare and there will still be people at the bottom rung of the ladder. As long as it's legal to accumulate wealth, there will always be wealthy people and there will always be poor people.

[bjl584]

At the current rates, we have a structural deficit. Even in good economic times we will be in the red. Rates need to be raised to correct it.

I would agree with you except that history shows that when Politicians have access to more money they spend more and more money without paying off past deficits. I'm all for a law that would force us to balance the budget, and make good on past debt obligations and not continue to incur more and more debt.

It's not their money. There is no accountability. It's being used to buy votes more than anything else in most cases. Why pay down debt or balance a budget to reduce a deficit when we can just think up a new tax or raise rates and get more money that way?

[disneysteve]

It will never be a level playing field

As long as it's legal to accumulate wealth, there will always be wealthy people and there will always be poor people.

This is one of those fundamental truths that nobody likes to talk about.

[Nika]

Because it just seems wrong that someone who gets up at 6 am in the morning, rain or shine, and commutes 2 hours to his job, away from his kids, should be taxed, pretty much all his life higher than the priviledged who never had to work and rely on capital gains (money making money) from their family's trust.

An airess with a chuwawa should be taxed 15% (probably less with the help of savy tax attorneys), but a working middle class guy living in NYC will be taxed over 40% (federal, state, city)?

Richer people have other ways of evading more taxes (company paid car, expense accounts) while we have to pay for our transportation and modest meals with money already taxed.

Middle Class New Yorker Blog

[humandraydel]

I was just saying that the wealthy person already paid 35% marginal tax rate on their income then used that income to buy stock.

This is not entirely true. A lot of the reason the 15% capital gains tax is under fire is because of hedge funds (and other investment professionals) - their "job" is investing, so their "salary" is only taxed at 15%. That's what Buffett means when he talks about his (effective) income tax rate being lower than his secretary - it's because he pays only 15% on capital gains which is probably 95% of his income.

[jpg7n16]

Do you think the capital gains tax should be tiered the same way the income tax is tiered?

Technically, it already is. People in the 15% bracket or lower may pay 0% tax on LTCG.

From: Tax Topics - Topic 409 Capital Gains and Losses

Generally, net [long term] capital gain is taxed at rates no higher than 15%. However, for the years 2008 through 2012, some or all net capital gain may be taxed at 0%, if it would otherwise be taxed at lower rates.

[thekid]

In Canada, it's a bit different. Only half of cap gains are taxed, and it is taxed at marginal rate of regular income (the other half is tax free). So, it's tiered, but still gets a (very) preferential tax treatment.

[photo]

photo-are you saying you were disadvantaged in that top bracket when you say "uncle sam was squeezing, let me tell you"?

I'm saying that someone who makes a few hundred thousand a year is in no way comparable to someone who makes millions upon millions a year. There's a difference between not worrying about paying bills vs having a live-in chef.

The tax paid affected me a lot more than it did Oprah Winfrey.

im in that bracket every year.

Great, then you keep paying those taxes.

[photo]

Is Government too big? Does the government spend recklessly and foolishly on way too may ventures?

I think that is a bigger problem than low tax rates.

But the bigger government becomes, the more money they're going to need for all their expenditures. Since cutting the budget doesn't seem to be an option, politicians feel that the only thing left is to raise taxes. But let's raise taxes on the trust fund babies who inherited literally tens of hundreds of millions of dollars at birth -- as opposed to raising taxes on those of us who actually earned the money, and not nearly the amount the old-money babies have.

Someone who actually earned $300,000 a year should be taxed differently from someone who inherited $30,000,000 and is just living off the earnings.

[photo]

Because it just seems wrong that someone who gets up at 6 am in the morning, rain or shine, and commutes 2 hours to his job, away from his kids, should be taxed, pretty much all his life higher than the priviledged who never had to work and rely on capital gains (money making money) from their family's trust.

Exactly. (I didn't see your post before I responded.)

[photo]

Even in good economic times we will be in the red. Rates need to be raised to correct it.

There's one more option that those of us in the real world know to do: cut spending. Someone actually has to work to support the country. Dare I mention the "A" word (Atlas...)

[photo]

if someone in that bracket is bitching about their tax burden, its cause they either arent smart with their money(unlikely if they got there in the first place), or they just want preferential treatment. i dont see any way around that.

Your myopic vision seems to equate earning money with managing money. Mike Tyson earned about $400 million during his career yet spent all of it plus millions more. Tragically, several high profile people have earned fortunes only to lose it all due to mismanagement.

Shockingly enough, there are even people who claim to be in the top income tax bracket who haven't mastered basic writing skills.