The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax

[moxy 1,051]

Just now, Nature Boy 2.0 said:

Bezos gave over 10 billion to charity. Also those numbers dont take into account all the taxes paid by his company and the 10's of 1000's of jobs he provides. 

Do your personal taxes reflect the taxes paid by your employer? (Amazon btw paid an effective tax rate of 0% in 2020.)

 

So yeah, let's math this out.

 

Bezos gave $10B to charity in 2020, which is roughly 10% of the $99 BILLION he brought in.

 

Assuming he can claim a $10B charitable deduction (the charitable tax deduction is wonky for 2020, so I'll just assume he can deduct 100%), Jeff Bezos paid 1% of $89 BILLION in federal taxes.

 

To turn this into numbers we can wrap our minds around, assume a person who brings in $50k/year donates 10% of their income, or $5,000, to charity. Their taxable income is $45k, assuming 100% charitable deduction. Let's also assume this person qualifies for the standard deduction for married joint filers, which works out to about $7k. Tax liability is now down to $38k. In our hypothetical situation, the rest of that would be taxed at the Bezos rate of 1%, or $380.

 

So we can see now that Jeff Bezos is paying an effective tax rate of a person making $50k only owing $380 to the IRS. In reality a person making $50k/year pays more like $4k/year, or 8%. Why does a person making $50k have to pay 8%, but Jeff Bezos only has to pay 1%? The answer: The ultra-wealthy are writing the tax code to benefit the ultra-wealthy.

 

Taxing the rich doesn't mean impoverishing the rich. Taxing the rich means making the rich pay their fair share.

[laylalex 7,301]

Once the genie is out of the bottle, we can't ignore what it looks like just because its release wasn't legal. Think about what came out of Wikileaks, or the Podesta email leaks for that matter. We don't get to cover our eyes and stick our fingers in our ears.

 

This isn't a country full of temporarily embarrassed billionaires. Getting Bezos to pay a little more towards supporting the country that made him so fabulously wealthy isn't going to affect middle class households making $100k a year, with a mortgage and a couple of cars. The wealth tax isn't going to touch them. It's not even going to touch people making a lot more than that a year, even with a couple of houses here and there. We're not talking "normal" rich people here.

 

One of the greatest tricks the rich have played on the poor and middling sorts is to convince them to carry water on their behalf, without compensation. Not that this is anything new, it's just that in the past vassals got protection from their liege lords, not 5% cashback with an Amazon credit card.

[Dashinka 25,566]

16 minutes ago, laylalex said:

Once the genie is out of the bottle, we can't ignore what it looks like just because its release wasn't legal. Think about what came out of Wikileaks, or the Podesta email leaks for that matter. We don't get to cover our eyes and stick our fingers in our ears.

 

This isn't a country full of temporarily embarrassed billionaires. Getting Bezos to pay a little more towards supporting the country that made him so fabulously wealthy isn't going to affect middle class households making $100k a year, with a mortgage and a couple of cars. The wealth tax isn't going to touch them. It's not even going to touch people making a lot more than that a year, even with a couple of houses here and there. We're not talking "normal" rich people here.

 

One of the greatest tricks the rich have played on the poor and middling sorts is to convince them to carry water on their behalf, without compensation. Not that this is anything new, it's just that in the past vassals got protection from their liege lords, not 5% cashback with an Amazon credit card.

Maybe not, but we should not ignore the illegality and try to bring the perpetrators to justice.  I would think if someone outed your personal tax information, you would want them brought to justice.

 

Almost every billionaire comes out publicly in favor of higher taxes for them (at least those that are also big public figures), yet for some reason, they do not write a bigger check to the US government.  I wonder why that is?  I know, they should pay their "fair share" which of course if we believe others means something like 37% on their income/wealth.  I believe in the 1960s, the top marginal rate was something like 91%.  We are all smart enough here to understand that almost no body pays the top marginal rate regardless of the number.  The only way to extract their supposed "fair share" is confiscation which is an area I would rather not see.

[moxy 1,051]

14 minutes ago, Dashinka said:

The only way to extract their supposed "fair share" is confiscation which is an area I would rather not see.

Why is that the only way? I e-file my taxes, I don't see why the ultra-rich can't do that.

[moxy 1,051]

Another fun fact: During the pandemic, 650 billionaires in the US increased their net worth by more than $1 TRILLION. Combined they are now worth $4.6 TRILLION. Billionaires increased their wealth by 34% since Jan 2020. During that same period, the middle class has continued to shrink, the poor have become poorer, and social safety nets have shrunk.

 

When we say that there is a cataclysmic inequality of distribution of wealth in this country, this is what we mean. When a minimum-wage worker has to pee in a bottle because they might lose their job otherwise, while their CEO is building a half-billion dollar yacht that is roughly pocket change against their total net worth, this is a problem.

 

 

[Dashinka 25,566]

21 minutes ago, moxy said:

Another fun fact: During the pandemic, 650 billionaires in the US increased their net worth by more than $1 TRILLION. Combined they are now worth $4.6 TRILLION. Billionaires increased their wealth by 34% since Jan 2020. During that same period, the middle class has continued to shrink, the poor have become poorer, and social safety nets have shrunk.

 

When we say that there is a cataclysmic inequality of distribution of wealth in this country, this is what we mean. When a minimum-wage worker has to pee in a bottle because they might lose their job otherwise, while their CEO is building a half-billion dollar yacht that is roughly pocket change against their total net worth, this is a problem.

 

 

So the answer to that is class warfare?  How did the social safety net shrink, I didn't hear about cuts to any welfare programs, and to my knowledge those are not a single pot of money.

 

38 minutes ago, moxy said:

Why is that the only way? I e-file my taxes, I don't see why the ultra-rich can't do that.

Again, did any of these folks break the tax laws?

[moxy 1,051]

8 minutes ago, Dashinka said:

So the answer to that is class warfare?

You are so close.

 

The answer is "tax the rich." The question is "Class warfare."

 

Quote

Again, did any of these folks break the tax laws?

The article (you read the article, right?) doesn't specifically say, although if I had to guess it was probably pulled from Wikileaks. Last I knew, you guys were cool with Wikileaks.

 

 

[laylalex 7,301]

No one is talking about class warfare. At least no one serious is. What is and should be up for debate is why it is "good" that we have such a lopsided system that punishes the poor and favors the rich at every hurdle.

 

I know where I fit in this structure, and I am one of the "winners." I don't "deserve" my wealth -- I happened to marry someone who is rich, and when we divorced I was compensated as we had agreed. I didn't set out to get divorced when I married him, and I would have married him if he'd just been middle class. I lucked into what I have. I could do just as well with less. I'm lucky to be in a position where I can give meaningful amounts to institutions I believe in. I think many people would look at me and say I'm well off. I don't mean that as a brag, it is what it is. But I'm not affected by the proposed wealth tax plans. The pool of people this will affect is very, very small. But the revenue that could be raised is very, very large. 

 

It's sort of missing the point to mention the former marginal tax rate of 91% without mentioning what it covered -- only that slice of income above $200,000 (about $2m today). Elizabeth Warren's proposal on instituting a wealth tax starts slicing 2% off every dollar in wealth (not income only) above $50 million, with 3% off every dollar above $1 billion. This is, if anything, a far more small-c conservative plan than what was in place in the 1950s.

[Dashinka 25,566]

14 minutes ago, moxy said:

You are so close.

 

The answer is "tax the rich." The question is "Class warfare."

 

The article (you read the article, right?) doesn't specifically say, although if I had to guess it was probably pulled from Wikileaks. Last I knew, you guys were cool with Wikileaks.

 

 

Yeah, I keep hearing the "tax the rich" "tax the corporations" mantra coming from the Left/Dems/Socialists/MSM.  Unfortunately it is not that simple, but I am sure you will be fine with higher hidden taxes on everybody.  I know the Dems want to keep the populace as divided as possible using race, and class primarily, but it all comes down to a fundamental.  You seem to be pushing for equal outcomes.  This is an impossibility, heck, even siblings raised in the same environment will not necessarily have equal outcomes.  Equal opportunities is the best we can do or even ask for.

 

Unless you have proof this came from Wikileaks, it is just a wild guess on your part.  I do not have any issue with Wikileaks when it is holding governments accountable, but releasing personal data of private citizens is another matter altogether.  Are you fine with the release of personal data?  If your taxes were released to the public would you be calling the perpetrator a "patriot"?

[moxy 1,051]

5 minutes ago, Dashinka said:

Yeah, I keep hearing the "tax the rich" "tax the corporations" mantra coming from the Left/Dems/Socialists/MSM.  Unfortunately it is not that simple, but I am sure you will be fine with higher hidden taxes on everybody.  I know the Dems want to keep the populace as divided as possible using race, and class primarily, but it all comes down to a fundamental.  You seem to be pushing for equal outcomes.  This is an impossibility, heck, even siblings raised in the same environment will not necessarily have equal outcomes.  Equal opportunities is the best we can do or even ask for.

- The worst argument against change is "it might not work."

- Literally nobody is saying everyone should be equal wealth-wise, nor is anyone saying there should be no rich people

- Literally nobody is saying we want equal outcomes

- Equal opportunities only work when there are equal opportunities

 

I keep saying "tax the rich fairly." You keep coming up with these bizarre conclusions. I don't know how much clearer I can make it. Imagine watching an NFL game, let's say the Chiefs and Packers. Packers have been spotted 8 trillion points. I say that's ridiculous, the Chiefs can never possibly win. And you argue that there's no way you can make it completely fair, so maybe just enjoy the game. Dude, I just want to watch a fair ballgame where two teams compete on their own merits. (in anticipation of a riposte: analogies break down at some point, usually very early. Don't try to extend this one too far.)

 

Quote

Unless you have proof this came from Wikileaks, it is just a wild guess on your part.

This is a nice summary of what I actually said, although I'm not sure why it needed to be summarized.

[Dashinka 25,566]

7 minutes ago, moxy said:

- The worst argument against change is "it might not work."

- Literally nobody is saying everyone should be equal wealth-wise, nor is anyone saying there should be no rich people

- Literally nobody is saying we want equal outcomes

- Equal opportunities only work when there are equal opportunities

 

I keep saying "tax the rich fairly." You keep coming up with these bizarre conclusions. I don't know how much clearer I can make it. Imagine watching an NFL game, let's say the Chiefs and Packers. Packers have been spotted 8 trillion points. I say that's ridiculous, the Chiefs can never possibly win. And you argue that there's no way you can make it completely fair, so maybe just enjoy the game. Dude, I just want to watch a fair ballgame where two teams compete on their own merits. (in anticipation of a riposte: analogies break down at some point, usually very early. Don't try to extend this one too far.)

 

This is a nice summary of what I actually said, although I'm not sure why it needed to be summarized.

I asked the question who decides what is "fair" and you ignored it.  In engineering, you do not try something this big without a lot of data behind it.  You suggested something like a universal basic income, well, we are seeing data that shows this would be detrimental to the workforce levels (as much as everyone on the Left wants to ignore it).  Btw, who spotted Bezos his advantage?  Who spotted Buffet.  I am not jealous of their accomplishment, and in fact believe we should celebrate accomplishment.  Now if you have proof that in their complex tax records they broke the law, bring it forward.  Beyond that, publishing this stuff at this time is simply another method that the Left (Media and politicians) use to divide the populace.

Edited June 10, 2021 by Dashinka

[moxy 1,051]

24 minutes ago, laylalex said:

The pool of people this will affect is very, very small. But the revenue that could be raised is very, very large.

This. Very much THIS.

 

Quote

It's sort of missing the point to mention the former marginal tax rate of 91% without mentioning what it covered -- only that slice of income above $200,000 (about $2m today). Elizabeth Warren's proposal on instituting a wealth tax starts slicing 2% off every dollar in wealth (not income only) above $50 million, with 3% off every dollar above $1 billion. This is, if anything, a far more small-c conservative plan than what was in place in the 1950s.

 

Exactly. Income tax brackets is a difficult thing for some to understand. When we say (I'm making up numbers here), "tax the super-rich 30%," that's not taking their entire income, multiplying by 30%, and sending them a tax bill. But that's the way it gets spun, because it's the ultra-rich who are using their power, influence, and unlimited funds to make sure it's spun that way.

[laylalex 7,301]

The very large pool of data that we have from the current regressive tax system is that the system is broken. We don't throw up our hands and say, wow, that sucks but what can you do? We're Americans. We're doers. We fix stuff. And fixing the tax system does not mean that the hyper-rich won't stay hyper-rich, or that we're all doomed to the grey misery of socialism.

 

The problem is that there isn't an apples to apples comparison between engineering and tax policy. One requires certainty from the outset before rollout -- one misstep and the entire bridge falls down, for example, depending on the nature of the misstep. But tax policy is to some extent a philosophy, and while it has practical applications in the form of "we take this from you," there is nothing concrete. There's no bridge or car or skyscraper. We can't road test these things to perfection before they are rolled out. Did Trump road test the tax cuts in 2017? No, there was no trial run. He was building on research and policy papers from think tanks that were sympathetic to the plan. Models can be drawn up, and they have been. Economists can build upon these models.

[TBoneTX 47,104]

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[Dashinka 25,566]

14 hours ago, laylalex said:

The very large pool of data that we have from the current regressive tax system is that the system is broken. We don't throw up our hands and say, wow, that sucks but what can you do? We're Americans. We're doers. We fix stuff. And fixing the tax system does not mean that the hyper-rich won't stay hyper-rich, or that we're all doomed to the grey misery of socialism.

 

The problem is that there isn't an apples to apples comparison between engineering and tax policy. One requires certainty from the outset before rollout -- one misstep and the entire bridge falls down, for example, depending on the nature of the misstep. But tax policy is to some extent a philosophy, and while it has practical applications in the form of "we take this from you," there is nothing concrete. There's no bridge or car or skyscraper. We can't road test these things to perfection before they are rolled out. Did Trump road test the tax cuts in 2017? No, there was no trial run. He was building on research and policy papers from think tanks that were sympathetic to the plan. Models can be drawn up, and they have been. Economists can build upon these models.

So you are suggesting tax policy can be created and implemented without worrying about the long-term impacts of that policy?  There is already a lot of data to look at in history as to the impacts of the so-called "tax the rich/corporations" policies, and the simple fact is there is no way to pinpoint those groups without impacting everyone else (including those that currently pay no income taxes).  If the Dems are fine with a higher tax on everyone, then that should be the stated position, and they should sell it properly.