Why can’t we use them?
Bwahaha…you think he is really living there? Or, is he using it to claim residency?
I honestly don’t know. I presume it has something to do with me not having enough money to make big investments, or something like that. OTOH, if you feel that you can use them, then go right ahead!
I’m willing to bet my life savings on it.
Fine, those deductions are fucking bullshit, and somebody in the government should do something so that people like Musk actually pay something in taxes while building up their $200+B fortunes. I don’t care whether it’s changing the deduction, capping the deduction, or creating a new tax.
If you want, you can click the down arrow and see this post in its entirety:
I think sweeping tax reforms [that are probably a metaphysical impossibilty] are the only way to turn our putative “progressive” tax system into an actual progressive tax system.
I have long suspected that it is exceedingly regressive, and getting moreso with each passing year.
Meaning that the middle class really is paying an outsized share for whatever federal spending this nation chooses.
Well, I was going off articles like this from 2020: https://www.cnbc.com/2020/08/18/how-tesla-and-spacex-ceo-elon-musk-spends-his-billions.html
It lists a few properties (like the ones @Whack-a-Mole posted) as well as multiple six-figure cars (a Lotus Esprit, a McLaren F1 - I think those are both either sold or wrecked).
Maybe all of that has changed since 2020, and now he lives in a tiny house and wears Target clothes while driving his Model 3. But I kinda doubt it.
I’m a conservative that generally thinks there needs to be a reward structure for successful entrepreneurship, it’s one of the major engines of what makes capitalist economies work–and such economies have largely produced a combination of the greatest increases in standard of living, technological development, and democratic development of any economic system.
That being said government has to run, and society has collective responsibilities and collective goals that need addressed. I don’t mind a significant concentration of wealth at the top of the pyramid, someone else being rich doesn’t make you any poorer. But that being said, I do think history has shown extreme wealth concentration is often associated with a number of ills. To me it’s pretty obvious there’s a balancing act, you don’t want to go crazy trying to take all the wealth of the wealthy for redistributive purposes or you’re going to get bad outcomes. But I also think if you have a country that has ran very, very large deficits for decades, and has a poorly funded system of social welfare, and has top tax payers paying lower effective tax rates than lower wealth tax payers, I think even a good conservative can say that things are tweaked too far in one direction.
I think a tax on unrealized gains is a smart move to go after getting the wealthy to pay something like the 30-35% of annual income they should be paying. It effectively treats investment gains as income for a class of people who have deliberately structured their finances so that most of their income is investment gains–a flexibility you have when you control a large company (or companies.) I have no interest in taking half of Bezos, Gates, or Musk’s accumulated wealth, but I do not think it’s crazy that people in the “extremely rich” wealth bracket pay somewhere in the range of 35% of annual earnings in tax.
I actually agree with Musk that for a great many things, businesses are better at allocating money than government is, but again, we need to have a functional society and I’d argue our tax / spending / social welfare matrix is well on its way to completely broken, and when there is vast wealth being accumulated almost entirely tax free, and sometimes passed on to heirs entirely tax free…that just isn’t something we should want as a society. Taxes are to fund societal common purpose, and the people who hold the most wealth should pay a reasonable proportion of their earnings back as tax.
Apropos of that …
My post about “Effective Tax Rate.” It’s almost surely a canard … a manipulation … a Big Lie:
Not really, so you’re confusing the fact that the tax code is complicated and has lots of deductions and offsets available to people who run businesses (investment losses, carried interest, the ability to carry forward losses for many years) with our ability to know how much effective taxes people are paying.
The tax policy foundation can tell you quite clearly if you dig into their data sets the typical % of AGI and % of income taxes the various percentiles pay.
Edit: Also your confusion about whether people know what “AGI” is and conflating it with how a layman may confuse total earnings for AGI…, I can assure you anyone who is very serious about tax policy understands what AGI is. There is a valid debate as to whether or not things that traditionally are not considered income should be subject to de novo taxation, particularly because a greater part of the accumulation of wealth happens through things like capital appreciation.
68k in taxes is about what you’d pay on 200k or so in income. Thats a high income, but not the 1% (which starts at about 500k in income)
You can.
Not that I’ve ever found, but I’d be grateful to be pointed (specifically) in the right direction.
Every effort that I’ve ever seen to characterize effective tax rate uses AGI as a denominator, which – as I said – gives us absolutely no ability to understand the difference between Gross and Adjusted Gross Income (ie, how much they deducted from Gross in order to determine the amount on which they pay Federal Income Tax).
Just one example …
This is all presented in terms of percent of AGI paid. It still fails to show the difference between Gross and Adjusted Gross Income by income level.
Even looking at the underlying IRS data linked (NOTE: .XLS file), it appears that the denominator is consistently AGI, rather than Gross Income.
Why is it fair to have exemptions that only the super rich qualify for but not taxes that only the super rich qualify for?
They strategy used isn’t only for the wealthy, but the more money you have in investments, the better it works.
[Missed the edit window]
Understanding what AGI means, and how it differs from Gross Income doesn’t automatically grant one access to Gross Income data.
It doesn’t inherently allow visibility into the dollar difference between Gross Income and Adjusted Gross Income – quite likely far greater in upper earners.
It doesn’t give us visibility into “True Effective Tax Rates” (ie, total Federal income taxes paid [divided by] total dollars made] that are a far more honest indicator of progressivity, regressivity, or “tax fairness” under a given set of tax rules.
You already have a whole thread for this topic so I won’t get into it too much here–but AGI is the relevant data for most tax discussion because that’s how we’ve agreed that taxes are to be levied, that aspect isn’t all that complicated.
You actually open a lot of complexity if you treat things that are not normally treated as income, as income.
In general terms he doesn’t pay income tax because he’s not taking an income from the company. He gets stock options whose value is theoretical until they are sold. If he cashed them in he would pay taxes on that amount. If you got paid in stock options you wouldn’t pay tax on it either.
Though I think my other thread is relevant, I also think it’s directly germane to the OP in this thread.
What you presented above is – with respect – something of a tautology: AGI is what matters because AGI is what we’ve agreed upon as the standard.
I disagree.
And I think it’s a relevant issue on any thread discussing tax policy/fairness.