View Full Version : Anyone else see a grim future for capital gains tax rates?
manaboutown
09-06-2024, 06:07 PM
Warren Buffett has been selling large amounts of AAPL and BAC stock from the BRK portfolio. No doubt one reason is to lock in gains while the market remains overpriced as well as rebalance the BRK portfolio which at one time was over 50% AAPL but I feel an additional reason is that he sees LTCG tax rates substantially increasing by 2026. So do I.
As an aside he has built up quite a war chest to buy when the time is right IMHO.
Thoughts?
OrangeBlossomBaby
09-06-2024, 06:36 PM
Warren Buffett has been selling large amounts of AAPL and BAC stock from the BRK portfolio. No doubt one reason is to lock in gains while the market remains overpriced as well as rebalance the BRK portfolio which at one time was over 50% AAPL but I feel an additional reason is that he sees LTCG tax rates substantially increasing by 2026. So do I.
As an aside he has built up quite a war chest to buy when the time is right IMHO.
Thoughts?
I think Warren Buffett is 94 years old, and preparing to cash out of the earthly plane. He knows he can't take it with him. He's stated many times that he wants to give most of it away. He's already given away billions over his lifetime. He also has kids and grandkids to inherit whatever is left over after he gives away the bulk of his estate.
"When the time is right" doesn't really mean much when you're 94 years old.
tophcfa
09-06-2024, 07:15 PM
Given our countries ever escalating unsustainable debt, taxes only have one direction to go. Since capital gains generally are associated with higher wealth status, that particular tax will be a politically palatable option.
tophcfa
09-06-2024, 07:26 PM
I think Warren Buffett is 94 years old, and preparing to cash out of the earthly plane. He knows he can't take it with him. He's stated many times that he wants to give most of it away. He's already given away billions over his lifetime. He also has kids and grandkids to inherit whatever is left over after he gives away the bulk of his estate.
"When the time is right" doesn't really mean much when you're 94 years old.
Hmmm, the stock referenced in this thread, that Buffet is liquidating, is owned by BRK, and he is the CEO of that company. That has nothing to do with how he manages the assets in his personal estate. As the CEO of Berkshire Hathaway, he has a responsibility to do what he feels is right for the constituents of the company, not himself. The time horizon of his personal estate and BKR are mutually exclusive.
Boomer
09-06-2024, 08:48 PM
Warren Buffett has been selling large amounts of AAPL and BAC stock from the BRK portfolio. No doubt one reason is to lock in gains while the market remains overpriced as well as rebalance the BRK portfolio which at one time was over 50% AAPL but I feel an additional reason is that he sees LTCG tax rates substantially increasing by 2026. So do I.
As an aside he has built up quite a war chest to buy when the time is right IMHO.
Thoughts?
I have been reading a little about this, but a lot of articles have panic-stoking headlines and some writers have an agenda that is pretty transparent by the angle they take and what information gets buried.
From what I can decipher, the proposed long-term capital gains tax rate increase would be on those with incomes of a million dollars a year. (That's annual income not net worth.) That other thing about unrealized gains looks like it applies to those sitting on a hundred million. But I have yet to find what is being said about us peasants who might want to sell some shares at the usual 15% (or less) rate.
I think a lot of regular people are thinking about this anyway just because the market is so high, but they don't want to sell because of the tax hit. Some, if on the older end and if they have more than they ever will need, might decide to give an early inheritance or donate shares to charity, and not pay any capital gains themselves and get to see the money used. Decisions like this are what my old, favorite accountant used to call trying to free your money from its prison.
Well, I do not make a million a year, and I am sure not sitting on a hundred million, and as far as I can find out, that's who this capital gains tax increase would hit.
Bottom line, it would never get through congress anyway to hit regular investors that hard because that would affect a lot of them, across the aisle, too.
Boomer (not too worried)
GoRedSox!
09-07-2024, 04:08 AM
I am going to try to comment on this is the least political way possible, but realistically, future taxes will be impacted by who is elected.
Looking into the future, the biggest financial items for us are:
1. Declining interest income due to falling interest rates;
2. Will the 2017 income tax provisions be extended after they expire in 2025?
3. Will ACA subsidies continue at current income levels after 2025?
I am not really worried about capital gains rates because our annual taxable income is nowhere near the $400,000 threshold and neither candidate is talking about tax increases for folks at this income level.
More significantly, these last few years, we were able to earn significant interest income on savings for the first time in over 15 years. Perhaps I should have tied up cash savings in ten year Treasuries, but I didn’t. Short term yields look like they are about to drop sharply. I am not putting these savings at risk, so there is going to be some lost income due to falling rates. That’s just a fact of life.
Next, the income tax provisions from the 2017 “tax cut” will impact us if they expire. That tax cut significantly increased the standard deduction, while also reducing some of the income tax brackets and eliminating personal exemptions. I have not attempted to figure out how much impact it will have if the tax cuts are not renewed. Neither candidate has talked about increasing taxes for those under $400,000, but Congress must take action to stop those tax cuts from expiring and I am not sure that can be assumed.
The old ACA subsidy income limits were 400% of the federal poverty level and the subsidies fell off the cliff at the first dollar of income over that limit. For a family of two, the limit prior to 2021 had been in the vicinity of $68k of modified adjusted gross income. The law was changed during the pandemic to raise the subsidy income limits to at least the $130’s of MAGI, I’m not sure exactly what the highest limit is but the subsidies phase out instead of dropping off a cliff. Anyway, we can’t get below $68k if those subsidies return to the old levels after 2025. I will go on Medicare late in 2025, but my wife not until 2030. The ACA plans with no subsidies are very expensive.
Everyone’s income and tax situation is different, but we are pretty typical early retirees and so others may be looking at similar situations. There may be other items as well I am forgetting about. Good luck to everyone.
Stu from NYC
09-07-2024, 05:25 AM
We are living in interesting times.
Hoping they look at outrageous spending going on.
CoachKandSportsguy
09-07-2024, 06:01 AM
Yeah, but it's not a stretch to reduce the threshold from $1M to $400k, and then not inflate it by CPI, and pretty soon high middle class will qualify. . .
Remember, taxes area by product of success, and tax rates are subject to the whims of congress, and populism if there is a large inequality in the socio economic status. . hmmm, things that remind us of the why in the French Revolution
Finally paying taxes is not the best reason to not sell. . .
if the tax rate is 15% and the value of the investment drops by 20 %, you have a lot less cash from the sale, 20% less from the drop and still another 15% from taxes. . . just ask T Boone Pickens. . . he made the decision on one investment to wait from short term to long term gains, and lost most of his profit while waiting. . said it was the stupidest decision evah!
Rainger99
09-07-2024, 06:49 AM
Hoping they look at outrageous spending going on.
When is the last time they did that???
It is usually a spending issue rather than a revenue issue.
In 2018 we were spending less than $5 trillion a year. I am old enough to remember that and I don’t recall people starving or that things were that bad.
If we cut spending back to 2018 spending there might be a need to increase tax rates. Increasing rates does not necessarily increase revenue and cutting rates does not necessarily decrease revenue.
U.S. government - Outlays 2029 | Statista (https://www.statista.com/statistics/200397/outlays-of-the-us-government-since-fiscal-year-2000/)
opinionist
09-07-2024, 06:55 AM
A significant financial event is on the horizon, and he is not the only insider selling their stock. Some insiders have never sold their stock before. The consequences of fiscal insanity may finally become manifest.
golfing eagles
09-07-2024, 06:55 AM
when is the last time they did that???
1774
Stu from NYC
09-07-2024, 07:43 AM
When is the last time they did that???
It is usually a spending issue rather than a revenue issue.
In 2018 we were spending less than $5 trillion a year. I am old enough to remember that and I don’t recall people starving or that things were that bad.
If we cut spending back to 2018 spending there might be a need to increase tax rates. Increasing rates does not necessarily increase revenue and cutting rates does not necessarily decrease revenue.
U.S. government - Outlays 2029 | Statista (https://www.statista.com/statistics/200397/outlays-of-the-us-government-since-fiscal-year-2000/)
If only I could post my thoughts on how to get it under control but think I would get into trouble.
rustyp
09-07-2024, 07:50 AM
If only I could post my thoughts on how to get it under control but think I would get into trouble.
I have a plan but if I post it now I will not be able to use it !
tophcfa
09-07-2024, 09:18 AM
A significant financial event is on the horizon, and he is not the only insider selling their stock. Some insiders have never sold their stock before. The consequences of fiscal insanity may finally become manifest.
It’s not if, but when, the consequences of fiscal (and monetary) insanity finally manifest themselves. The recent bout of hyper inflation was just a sneak preview.
And now they are ready to slash interest rates to levels below real rates of return yet again, inflating the bubble even more before it eventually bursts.
DrMack
09-07-2024, 11:22 AM
Next, the income tax provisions from the 2017 “tax cut” will impact us if they expire. That tax cut significantly increased the standard deduction, while also reducing some of the income tax brackets and eliminating personal exemptions. I have not attempted to figure out how much impact it will have if the tax cuts are not renewed. Neither candidate has talked about increasing taxes for those under $400,000, but Congress must take action to stop those tax cuts from expiring and I am not sure that can be assumed.
This would be the most alarming circumstance brought to the table for this country. You can’t overstate how important it is that the cuts do not expire. If they do, it will be a huge increase on everyone. Further, inflation will skyrocket as corporations raise their prices for their goods to pay for the change.
Aces4
09-07-2024, 12:03 PM
I have been reading a little about this, but a lot of articles have panic-stoking headlines and some writers have an agenda that is pretty transparent by the angle they take and what information gets buried.
From what I can decipher, the proposed long-term capital gains tax rate increase would be on those with incomes of a million dollars a year. (That's annual income not net worth.) That other thing about unrealized gains looks like it applies to those sitting on a hundred million. But I have yet to find what is being said about us peasants who might want to sell some shares at the usual 15% (or less) rate.
I think a lot of regular people are thinking about this anyway just because the market is so high, but they don't want to sell because of the tax hit. Some, if on the older end and if they have more than they ever will need, might decide to give an early inheritance or donate shares to charity, and not pay any capital gains themselves and get to see the money used. Decisions like this are what my old, favorite accountant used to call trying to free your money from its prison.
Well, I do not make a million a year, and I am sure not sitting on a hundred million, and as far as I can find out, that's who this capital gains tax increase would hit.
Bottom line, it would never get through congress anyway to hit regular investors that hard because that would affect a lot of them, across the aisle, too.
Boomer (not too worried)
I think a little critical thinking here, ( tongue in cheek), would help one realize the little gain there would be from taxing the few elite and would hardly put a dent in the issue that is looming. EVERYONE will be paying and the more you have, the more you'll pay. This will potentially affect anyone with capital gains in a big way.
Arctic Fox
09-07-2024, 01:26 PM
Warren Buffett has been selling large amounts of AAPL and BAC stock from the BRK portfolio. No doubt one reason is to lock in gains while the market remains overpriced as well as rebalance the BRK portfolio which at one time was over 50% AAPL but I feel an additional reason is that he sees LTCG tax rates substantially increasing by 2026.
Mr Buffett has been one of the few ultra wealthy people to say that he thinks everyone should pay their fair share of taxes, so if he thought that the stocks would continue to rise significantly then I suspect he would be happy to hang on to them and pay any (possible) increased tax.
Pugchief
09-07-2024, 01:51 PM
Not everyone got a tax cut in 2017. I sure didn't. I was still working full time, and paying a lot of state income tax and local property tax. The tax "cut" in 2017 capped the state and local tax deduction (SALT) at $10,000. I had been able to deduct mortgage interest, all our charitable contributions, and over $30,000 in state and local taxes prior to the change. With the SALT deduction capped, we had to go to the standard deduction. It resulted in a tax increase for us, and many others in the Northeast and Far West. I just saw one of the analysts on CNBC say that the 2017 tax cut was the biggest tax increase he ever had in his life due to the SALT cap of $10,000. There are many NY Republicans who will never vote to extend the tax cuts if the SALT cap is not lifted.
Is that the fault of the 2017 federal law, or the few states that impose insanely high taxes on their residents?
Stu from NYC
09-07-2024, 02:16 PM
Govt spending is very inefficient and crowds out investments that is where jobs are created.
Boomer
09-07-2024, 02:23 PM
Okey Dokey, my fellow boomers and sooner, let's take a look at one of the best capital gains tax changes that helped so many of us regular people as we were buying and selling houses throughout our lives.
A lot of us can remember the time when if you sold your primary residence, you had to reinvest your profit into a more expensive house or pay capital gains tax on that profit. I have always thought the old tax law led to the McMansions that were first built in developing suburbs. Those McMansions often sold to people transferring for jobs. Might as well be livin' large and not let the government get their hands on your profit from the home you had sold. Remember that.
AND THEN came the Tax Payer Relief Act of 1997. Yes, I said 1997 and that changed everything for a lot of middle class people whose biggest investment was in their primary residence.
In 1997, the law changed to allow a $250,000 single and a $500,000 married captial gains profit on a house TAX FREE, if it has been the primary residence for 2 out of the past 5 years. Many of us have profited, some repeatedly, under that 1997 tax law change. We can now sell a house for a big profit, buy a less expensive one, often for cash -- and keep a nice chunk of change for ourselves.
So? That law that put a lot of money into middle-class pockets happened in 1997 under an administration that was watching out for the middle class. You all know who you owe that 1997, and still going, tax break to. But some have conveniently forgotten and are now all caught up in the 2017 change but don't have the big picture on that one......
How many people know that the 2017 tax law was skewed to the very high end wealthy? AND even though there is a sunset built in for the end of 2025, the corporation tax cut was made permanent. It's just the rest of us who will see the end of it if it expires. Didya know that? Didya, huh?
While I thought the corporate tax rate had been too high, that cut from 35% to 21% with all that back-slapping was obscenely huge. Where did it go? A lot to stock buybacks, inflating the market. Not enough to employees and capital projects. Corps get to keep their cuts when the cuts expire for the rest. Those cuts sure affected the deficit and not in a good way.
I am watching all this tax talk closely, but I am careful to try to get all the information. The middle class has been the backbone of this country. But continuing to give all the tax breaks to corporations and very high wealth individuals means that the backbone of the country will eventually break.
Somehow, I keep picturing that the goal of some is to establish a sort of feudal system like existed in Europe from the 9th to the 15th centuries where only those at the very top had all the money and land while most were relegated to serfdom......
Plutocracy/Oligarchy = Serfdom. Be careful what you wish for and read between the lines.
Just like that tax break we regular people got in 1997 and still have, let's hope we will see more breaks for the middle class because that 2017 tax relief act was not written for us -- for long. Just long enough to deceive us.....
Boomer (who likes to talk about taxes :oops:)
manaboutown
09-07-2024, 03:36 PM
The Tax Reform Act of 1993 changed my life (I referred to it as the "Tax Deform Act" at the time).
The act increased the maximum federal rate to 39.6% and was retroactive to the first of the year. I was 51 years old and had just taken a new job. I had owned rental real estate since the late 1960s and had gradually developed and acquired more. My net rental income had grown over time. I had just bought a new to me preowned 1990 Mercedes Benz 420 SEL and was wondering how much gross income I now needed to pay for the car so I did a spreadsheet. What a shock! It would take what I would net after FICA and federal and state income taxes for a full year's work at my new job to pay for the car as my underlying rental income boosted my earned income into higher tax brackets and I was keeping only 31.5 cents of every earned dollar after taxes and job related nondeductible expenses. It took a lot of soul searching as I was concerned about the cost of medical insurance when my COBRA expired after 18 months. I also wondered if I could live on my rental income and still lead my current lifestyle. After much deliberation, prayer and many sleepless nights I bit the bullet and quit, retiring from my profession. In hindsight in a bizarre way I am grateful for the tax deform act as strange as that seems.
Later on I learned that during his big Hollywood years while the top federal tax rate was 90% Ronald Reagan would only do two films a year as he was earning $400K/film. Because he would keep so little of any further earnings he decided to loaf.
Aces4
09-07-2024, 03:39 PM
Okey Dokey, my fellow boomers and sooner, let's take a look at one of the best capital gains tax changes that helped so many of us regular people as we were buying and selling houses throughout our lives.
A lot of us can remember the time when if you sold your primary residence, you had to reinvest your profit into a more expensive house or pay capital gains tax on that profit. I have always thought the old tax law led to the McMansions that were first built in developing suburbs. Those McMansions often sold to people transferring for jobs. Might as well be livin' large and not let the government get their hands on your profit from the home you had sold. Remember that.
AND THEN came the Tax Payer Relief Act of 1997. Yes, I said 1997 and that changed everything for a lot of middle class people whose biggest investment was in their primary residence.
In 1997, the law changed to allow a $250,000 single and a $500,000 married captial gains profit on a house TAX FREE, if it has been the primary residence for 2 out of the past 5 years. Many of us have profited, some repeatedly, under that 1997 tax law change. We can now sell a house for a big profit, buy a less expensive one, often for cash -- and keep a nice chunk of change for ourselves.
So? That law that put a lot of money into middle-class pockets happened in 1997 under an administration that was watching out for the middle class. You all know who you owe that 1997, and still going, tax break to. But some have conveniently forgotten and are now all caught up in the 2017 change but don't have the big picture on that one......
How many people know that the 2017 tax law was skewed to the very high end wealthy? AND even though there is a sunset built in for the end of 2025, the corporation tax cut was made permanent. It's just the rest of us who will see the end of it if it expires. Didya know that? Didya, huh?
While I thought the corporate tax rate had been too high, that cut from 35% to 21% with all that back-slapping was obscenely huge. Where did it go? A lot to stock buybacks, inflating the market. Not enough to employees and capital projects. Corps get to keep their cuts when the cuts expire for the rest. Those cuts sure affected the deficit and not in a good way.
I am watching all this tax talk closely, but I am careful to try to get all the information. The middle class has been the backbone of this country. But continuing to give all the tax breaks to corporations and very high wealth individuals means that the backbone of the country will eventually break.
Somehow, I keep picturing that the goal of some is to establish a sort of feudal system like existed in Europe from the 9th to the 15th centuries where only those at the very top had all the money and land while most were relegated to serfdom......
Plutocracy/Oligarchy = Serfdom. Be careful what you wish for and read between the lines.
Just like that tax break we regular people got in 1997 and still have, let's hope we will see more breaks for the middle class because that 2017 tax relief act was not written for us -- for long. Just long enough to deceive us.....
Boomer (who likes to talk about taxes :oops:)
This is so politically skewed I hesitate to respond. Yes, tax the devil out of corporations and push them out of the USA because somehow they have been made the public teat for everyone. :shocked::shocked:
GoRedSox!
09-07-2024, 05:48 PM
Is that the fault of the 2017 federal law, or the few states that impose insanely high taxes on their residents?This is not simply a matter of some states having much higher taxes. I come from CT. We have a 6.35% state sales tax. The income tax is about 5% for me. And yes, local property taxes are high because we pay teachers good salaries and invest in education. Also, public schools are administered town by town, so we have 169 different school systems and that is not the most efficient way to deliver services. It also costs a lot to heat the state, snow removal, road maintenance is more due to weather, and salaries are much higher up there so it costs government more to run. The $10,000 limit certainly favored lower tax states. I am so sure that the NY Republicans will not vote in favor of extending the tax law next year unless the SALT limitation is removed. All those tax cuts will not be renewed without it, they have been trying to get it removed for years and this is their last chance.
GoRedSox!
09-07-2024, 07:55 PM
Back to the original poster's point about capital gains rates, the biggest thing for our taxes as it relates to capital gains rates is actually not capital gains, but qualified dividends are taxed under the same brackets and same umbrella.
As we look to 2025, if a couple's taxable income is about $95,000 or less, qualified dividends are taxed at 0%. Taxable income is after all deductions. The standard deduction next year will be about $30,000, and we can take a deduction for an HSA of over $8,000, so we could have an income of over $130,000 in total and still have a 0% federal tax rate on the majority of our income, which is from dividends.
Obviously, if they don't extend the tax provisions, it is going to mean a tax increase, even though it was promised no one under $400,000 will get a tax increase.
I knew a good number of folks who had income of $400,000 a year while working, but I do not know many who have that kind of income when retired. That is really a whopping income to generate in retirement. So most of us should not have any tax increases if the politicians keep their promises.
Rainger99
09-07-2024, 08:57 PM
So most of us should not have any tax increases if the politicians keep their promises.
You are a trusting soul!
GizmoWhiskers
09-08-2024, 06:14 AM
Given our countries ever escalating unsustainable debt, taxes only have one direction to go. Since capital gains generally are associated with higher wealth status, that particular tax will be a politically palatable option.
Taxes are not the only way to go. There are other ways to bring prosperity back to The Villages and beyond. We all know the definition of insanity...
bogmonster
09-08-2024, 07:16 AM
The SALT was a myth for the 'Blue' in power in your state and most other 'Blue' states.Very soon after this was passed, each state passed a provision to allow businesses to pay the state tax for the owner/partner. I know Minnesota was a fast follower. It's all on you if you didn't work with your tax advisor to reduce your tax exposure. Same with your properties. If they were held by a LLC, you were able to still deduct those property taxes.
As for the corporate tax rate. Corporations just relocated prior to that anyways. Medtronic in MN moved it's corp headquarters to Ireland. Why pay 38% when you can pay 8%. It's a global economy now.
spinner1001
09-08-2024, 07:20 AM
Warren Buffett has been selling large amounts of AAPL and BAC stock from the BRK portfolio.
Historically, Warren Buffet has been a value investor.[1] Robert Shiller’s (Yale University) CAPE (Cyclically Adjusted P/E) measure shows stock prices (relative) overall are near historical highs aside from the January 2000 dot-com bust. The CAPE level now is about 35 (see first link below).
Buffet might be taking some money off the table by selling certain stocks he perceives as expensive to have more dry powder (cash) for buying cheaply the future. Owning Treasury and corporate bonds for Buffet is not so bad now with bonds paying higher interest rates compared recent historical levels.
Shiller PE Ratio - Multpl (https://www.multpl.com/shiller-pe)
Cyclically adjusted price-to-earnings ratio - Wikipedia (https://en.wikipedia.org/wiki/Cyclically_adjusted_price-to-earnings_ratio)
[1] Value investors in this context focus on stocks that are trading at a ‘cheap’ price rather than growth. The most common measure to assess cheap or expensive prices is the price-to-earnings ratio (P/E).
Online Data - Robert Shiller (http://www.econ.yale.edu/~shiller/data.htm)
RoboVil
09-08-2024, 07:25 AM
They can't stop the outrageous spending. That is how they buy votes.
rsmurano
09-08-2024, 07:51 AM
It’s a fallacy to think none of the new proposed taxes isn’t going to affect people making less than $400k. In a few months you will see increases (big) in our Medicare costs along with pharmacy supplement plans, someone is going to pay for those drug caps that were put on. The new social security tax increases that have been talked about will affect everybody that works. Instead of the $115k cap, that is being raised quite a bit. The people making more than $400k will pay more after hitting another threshold, but people making $150k will get an increase.
As for Warren selling stuff, big deal. I’ve sold all of my stuff 2x during the past 3 years, put all my $$$ in the money market making over 5.25%. During 2023 and early 2024 i put my money back in the market to make 30-100% gains in hen got back out months ago. Big deal. Now I’m prepared when the market tanks to buy again. A lot of investors have been selling. Have you seen the AI stock prices lately? Today with the AI craze, resembles the dot com craze in 2000 and you remember what happened then?
Before they implement the “unrealized” capital gains tax, I will sell everything and either sit on cash or probably just stay in the money market. You do know the that you will pay taxes on book value gains but you won’t get a refund if your portfolio goes down. Then think about this: say you have $5M portfolio and you have $500k gain on book value, you pay 40+% on these gains. Then you run into recession and your portfolio drops to $4M, no refund or tax credit. Now the recession ends and you make $600k on your $4M, you will pay unrealized tax gains in that $600k. How is this right? You think the government is going to keep track of your highs and lows? No! They will look at your brokers stats for the calendar year to see how much gain you made.
1 more fallacy that people won’t be effected with the $400k income cap.
You do know that 100% of the companies that we buy food from, electricity from, insurance from, gas from, car manufacturers, doctors, when their taxes rise, so do all the prices of the goods that make that we buy. Why did all of us pay more for groceries? Gas? Property taxes? Electricity?
Taxes hurt everybody at all income levels, don’t be fooled.
The Chipster
09-08-2024, 08:53 AM
It might be grim for those making over $400,000 per year. Are you worried about them?
TheWarriors
09-08-2024, 09:11 AM
This is not simply a matter of some states having much higher taxes. I come from CT. We have a 6.35% state sales tax. The income tax is about 5% for me. And yes, local property taxes are high because we pay teachers good salaries and invest in education. Also, public schools are administered town by town, so we have 169 different school systems and that is not the most efficient way to deliver services. It also costs a lot to heat the state, snow removal, road maintenance is more due to weather, and salaries are much higher up there so it costs government more to run. The $10,000 limit certainly favored lower tax states. I am so sure that the NY Republicans will not vote in favor of extending the tax law next year unless the SALT limitation is removed. All those tax cuts will not be renewed without it, they have been trying to get it removed for years and this is their last chance.
Your SALT deduction was subsidized by the rest of the tax paying Americans. Why should they have to pay more in tax because you have outrageous taxes you want to write off on your income?
Would it be ok if a city provided a new car to residents each year and this was just part of your taxes and you could completely deduct it?
spinner1001
09-08-2024, 11:09 AM
It’s a fallacy to think none of the new proposed taxes isn’t going to affect people making less than $400k.
Exactly.
For one, I have not seen the tax proposal is indexed to inflation. $400,000 today will not be $400,000 in ten years. If average inflation is 5% per year, in today’s dollars, $400,000 in ten years is $246,000 today. A lot of two income households make over $200,000 today.
BobGraves
09-08-2024, 12:05 PM
I believe the corporate tax rates were passed permanently. Many of the other provisions were only through 2025, because they would have raised the deficit more than what is allowed under Reconciliation...which bypassed the filibuster in the Senate and only required 50 votes.
The fact of the matter is, and I think I can say this because it's fact and not political, the deficits under Trump were horrific....even the deficits that were accumulated way before the pandemic. He said we had the best economy ever, and if that was true, we should have never run up deficits like we did.
Not everyone got a tax cut in 2017. I sure didn't. I was still working full time, and paying a lot of state income tax and local property tax. The tax "cut" in 2017 capped the state and local tax deduction (SALT) at $10,000. I had been able to deduct mortgage interest, all our charitable contributions, and over $30,000 in state and local taxes prior to the change. With the SALT deduction capped, we had to go to the standard deduction. It resulted in a tax increase for us, and many others in the Northeast and Far West. I just saw one of the analysts on CNBC say that the 2017 tax cut was the biggest tax increase he ever had in his life due to the SALT cap of $10,000. There are many NY Republicans who will never vote to extend the tax cuts if the SALT cap is not lifted.
The SALT Deduction Cap at $10,000 was implemented for Fairness. Why should someone living in Florida have to make up for the Federal taxes that a NY resident didn't have to pay because they deducted their extraordinarily high NY taxes? If you choose to live in NY, NJ,California, or another high tax state with high cost social programs, that's your choice... You should pay for it.
manaboutown
09-08-2024, 12:22 PM
As an addendum to the OP, since BRK is a C corporation the sale of long held assets is treated as income. No distinction is made between LTCGs, STCGs and regular income. However, the current C corporation tax rate faces a substantial boost so perhaps Buffett's thoughts and actions parallel those of individuals regarding LTCG treatment and tax rates in the near future.
GoRedSox!
09-08-2024, 12:29 PM
The SALT was a myth for the 'Blue' in power in your state and most other 'Blue' states.Very soon after this was passed, each state passed a provision to allow businesses to pay the state tax for the owner/partner. I know Minnesota was a fast follower. It's all on you if you didn't work with your tax advisor to reduce your tax exposure. Same with your properties. If they were held by a LLC, you were able to still deduct those property taxes.
As for the corporate tax rate. Corporations just relocated prior to that anyways. Medtronic in MN moved its corp headquarters to Ireland. Why pay 38% when you can pay 8%. It's a global economy now.I am not a business owner. There was no workaround in CT. The IRS said that states could not cook up schemes like the one NY was using. Many taxpayers in high tax states were certainly impacted by SALT.
Rainger99
09-08-2024, 12:29 PM
Exactly.
For one, I have not seen the tax proposal is indexed to inflation. $400,000 today will not be $400,000 in ten years. If average inflation is 5% per year, in today’s dollars, $400,000 in ten years is $246,000 today. A lot of two income households make over $200,000 today.
Remember the AMT??
The AMT was originally designed to tax high-income taxpayers who used the regular tax system to pay little or no tax. Due to inflation and cuts in ordinary tax rates, a larger number of taxpayers began to pay the AMT. The number of households owing AMT rose from 200,000 in 1982 to 5.2 million in 2017, but was reduced back to 200,000 in 2018 by the TCJA. After the expiry of the TCJA in 2025, the number of AMT taxpayers is expected to rise to 7 million in 2026.
GoRedSox!
09-08-2024, 12:31 PM
The SALT Deduction Cap at $10,000 was implemented for Fairness. Why should someone living in Florida have to make up for the Federal taxes that a NY resident didn't have to pay because they deducted their extraordinarily high NY taxes? If you choose to live in NY, NJ,California, or another high tax state with high cost social programs, that's your choice... You should pay for it.There is a large amount of data out there that shows that the high tax states like NY and CT were already paying more than they were getting back and the red states were getting more than they were paying. I'm not sure where FL sits in that data, and I am not going to look it up when there is football to be watched.
manaboutown
09-08-2024, 12:45 PM
Remember the AMT??
The AMT was originally designed to tax high-income taxpayers who used the regular tax system to pay little or no tax. Due to inflation and cuts in ordinary tax rates, a larger number of taxpayers began to pay the AMT. The number of households owing AMT rose from 200,000 in 1982 to 5.2 million in 2017, but was reduced back to 200,000 in 2018 by the TCJA. After the expiry of the TCJA in 2025, the number of AMT taxpayers is expected to rise to 7 million in 2026.
'Minimum' is a misnomer as utilized in AMT. I have paid it every single year since it was introduced so am certain of this, unfortunately!
Stu from NYC
09-08-2024, 01:08 PM
'Minimum' is a misnomer as utilized in AMT. I have paid it every single year since it was introduced so am certain of this, unfortunately!
Very true
Rainger99
09-08-2024, 01:11 PM
There is a large amount of data out there that shows that the high tax states like NY and CT were already paying more than they were getting back and the red states were getting more than they were paying. I'm not sure where FL sits in that data, and I am not going to look it up when there is football to be watched.
New Mexico is the only state paying less in taxes than it receives in support – paying only 85 cents in federal taxes for each dollar of support.
Not Found | SmartAsset.com (https://smartasset.com/financial-advisor/states-most-dependent-federal-government-2023)
Pugchief
09-08-2024, 01:33 PM
While I thought the corporate tax rate had been too high, that cut from 35% to 21% with all that back-slapping was obscenely huge. Where did it go? A lot to stock buybacks, inflating the market. Not enough to employees and capital projects. Corps get to keep their cuts when the cuts expire for the rest. Those cuts sure affected the deficit and not in a good way.
Unintended consequences of having the highest corporate tax rate in the world just led US corps to move their HQs to countries with lower rates. The corporate tax rate should be competitive with the rest of the world; 20% of something is more money than 100% of nothing.
Somehow, I keep picturing that the goal of some is to establish a sort of feudal system like existed in Europe from the 9th to the 15th centuries where only those at the very top had all the money and land while most were relegated to serfdom......
"Some" = the Elites, and sadly, that statement is probably true. Freedom of speech being trampled worldwide, Climate Hoax and pandemic scares to control lemming populace. Our forefathers fought in wars to give us the freedoms we have today. Don't let their sacrifices be in vain.
Pugchief
09-08-2024, 01:39 PM
Later on I learned that during his big Hollywood years while the top federal tax rate was 90% Ronald Reagan would only do two films a year as he was earning $400K/film. Because he would keep so little of any further earnings he decided to loaf.
Exactly. The "tax the rich and give me free stuff" crowd fails to realize that confiscatory tax rates lead to decreased economic output.
manaboutown
09-08-2024, 01:39 PM
New Mexico is the only state paying less in taxes than it receives in support – paying only 85 cents in federal taxes for each dollar of support.
Not Found | SmartAsset.com (https://smartasset.com/financial-advisor/states-most-dependent-federal-government-2023)
New Mexico is 47.4% public land. Too, it is one of the very poorest of states for many reasons. What keeps it going is a huge federal workforce, civilian and military. That is likely why it receives more from the federal government than its residents pay in federal income tax. I grew up in NM and have owned a business there since 1972. Last year my accountant informed me if my (passthrough entity) LLC paid state income tax on its earnings the tax would be deductible whereas if I paid it personally it would not, due to SALT. So, Yippee, the NM state income tax my LLC pays is deductible!
Karmanng
09-08-2024, 01:43 PM
I have been reading a little about this, but a lot of articles have panic-stoking headlines and some writers have an agenda that is pretty transparent by the angle they take and what information gets buried.
From what I can decipher, the proposed long-term capital gains tax rate increase would be on those with incomes of a million dollars a year. (That's annual income not net worth.) That other thing about unrealized gains looks like it applies to those sitting on a hundred million. But I have yet to find what is being said about us peasants who might want to sell some shares at the usual 15% (or less) rate.
I think a lot of regular people are thinking about this anyway just because the market is so high, but they don't want to sell because of the tax hit. Some, if on the older end and if they have more than they ever will need, might decide to give an early inheritance or donate shares to charity, and not pay any capital gains themselves and get to see the money used. Decisions like this are what my old, favorite accountant used to call trying to free your money from its prison.
Well, I do not make a million a year, and I am sure not sitting on a hundred million, and as far as I can find out, that's who this capital gains tax increase would hit.
Bottom line, it would never get through congress anyway to hit regular investors that hard because that would affect a lot of them, across the aisle, too.
Boomer (not too worried)
I would bet thou that somewhere in there plan we are all included somewhere.......Its going to be for everyone this way we are all broke and rely on the government etc etc........this is there plan the rich all include the upper elite.....Pelosi, Biden etc......they dont want to pay or they hid there money.........I surely hope it doesnt happen anyway.........cuz things will be very bad
Pugchief
09-08-2024, 01:43 PM
This is not simply a matter of some states having much higher taxes. I come from CT. We have a 6.35% state sales tax. The income tax is about 5% for me. And yes, local property taxes are high because we pay teachers good salaries and invest in education.
Good for CT. But people in the other 49 states shouldn't have to pay for YOUR schools.
Also, public schools are administered town by town, so we have 169 different school systems and that is not the most efficient way to deliver services.
LOL, it sure isn't. Not our problem.
It also costs a lot to heat the state, snow removal, road maintenance is more due to weather.
By that faulty logic, North Dakota would have the highest tax rate in the US.
Pugchief
09-08-2024, 01:46 PM
Before they implement the “unrealized” capital gains tax, I will sell everything and either sit on cash or probably just stay in the money market. You do know the that you will pay taxes on book value gains but you won’t get a refund if your portfolio goes down. Then think about this: say you have $5M portfolio and you have $500k gain on book value, you pay 40+% on these gains. Then you run into recession and your portfolio drops to $4M, no refund or tax credit. Now the recession ends and you make $600k on your $4M, you will pay unrealized tax gains in that $600k. How is this right? You think the government is going to keep track of your highs and lows? No! They will look at your brokers stats for the calendar year to see how much gain you made.
I wouldn't worry too much. That law will never pass. Even their own economists have panned the idea.
Stu from NYC
09-08-2024, 02:46 PM
Exactly. The "tax the rich and give me free stuff" crowd fails to realize that confiscatory tax rates lead to decreased economic output.
So very true. Why work if you cannot keep what you make?
If they made more they buy more stuff and that would lead to more jobs.
Pairadocs
09-08-2024, 02:46 PM
Given our countries ever escalating unsustainable debt, taxes only have one direction to go. Since capital gains generally are associated with higher wealth status, that particular tax will be a politically palatable option.
Totally agree ! WHY do "we" (our government regardless of which party is in at the time) believe we alone will be the only nation in history to successfully be able to keep increasing our debt infinitely ?? That's what psychologists term "magical thinking", and point out to their patients that clinging to this type of thinking (un-grounded in reality), is a symptom of mental illness and/or instability ! Perhaps BOTH major political parties should do more thorough in VETTING those they put on the ballot ? Are they TRULY wishing ONLY to be public SERVANTS, or, do they have self-serving motives ?
jimjamuser
09-08-2024, 02:57 PM
Yeah, but it's not a stretch to reduce the threshold from $1M to $400k, and then not inflate it by CPI, and pretty soon high middle class will qualify. . .
Remember, taxes area by product of success, and tax rates are subject to the whims of congress, and populism if there is a large inequality in the socio economic status. . hmmm, things that remind us of the why in the French Revolution
Finally paying taxes is not the best reason to not sell. . .
if the tax rate is 15% and the value of the investment drops by 20 %, you have a lot less cash from the sale, 20% less from the drop and still another 15% from taxes. . . just ask T Boone Pickens. . . he made the decision on one investment to wait from short term to long term gains, and lost most of his profit while waiting. . said it was the stupidest decision evah!
I think that too many people worry too much about paying taxes. Just concentrate on making good investments that go up in value over the long term and don't worry about the taxes.
OrangeBlossomBaby
09-08-2024, 03:08 PM
The SALT Deduction Cap at $10,000 was implemented for Fairness. Why should someone living in Florida have to make up for the Federal taxes that a NY resident didn't have to pay because they deducted their extraordinarily high NY taxes? If you choose to live in NY, NJ,California, or another high tax state with high cost social programs, that's your choice... You should pay for it.
Why should taxes paid by New Yorkers and other wealthy states, get funneled to poorer states? Why do poorer states get more of our tax dollars? Maybe the Feds should stop sharing the wealth. Let states like Mississippi, Alabama, Tennessee, Louisiana, and Kentucky fund all their own welfare, food stamps, child care relief, medicaid, infrastructure needs, and section 8 housing. Or maybe they should promote birth control and responsible family planning, promote better education for their citizens, to help these people rise up and become productive contributing members of society instead of leeching off the federal (New York Taxpayer) coffers.
By the way - Florida is not one of the wealthier states, and therefore it also receives a greater share of the kitty that the wealthier states pay more into.
OrangeBlossomBaby
09-08-2024, 03:11 PM
Good for CT. But people in the other 49 states shouldn't have to pay for YOUR schools.
LOL, it sure isn't. Not our problem.
By that faulty logic, North Dakota would have the highest tax rate in the US.
So you're in favor of just dissolving the UNITED States of America entirely right? That way -no- federal money funds ANY other state, because "Federal" would cease to exist. Let's have 50 countries, instead of a single country. And each country can deal with its own expenses.
Glowing Horizon
09-08-2024, 04:23 PM
Warren Buffett has been selling large amounts of AAPL and BAC stock from the BRK portfolio. No doubt one reason is to lock in gains while the market remains overpriced as well as rebalance the BRK portfolio which at one time was over 50% AAPL but I feel an additional reason is that he sees LTCG tax rates substantially increasing by 2026. So do I.
As an aside he has built up quite a war chest to buy when the time is right IMHO.
Thoughts?
Anyone who knows anything about Warren Buffet knows that he does not “time the market.” He has always believed & practiced buying a company or a stock with great core fundamentals, with a reliable product & a great reputation. He buys companies he believes have extreme growth potential due to its present stock undervaluation. Warren buys & holds—long term. Never speculative.
As for capital gains increases, you should be far more concerned about the proposal to tax UNREALIZED gains. That means whether you EVER sell it or not, you will pay federal INCOME taxes on it every year if the valuation “on paper” has increased.
I think this is fundamentally against our federal Constitution but then so are property taxes which also tax UNREALIZED gains—as if they are “income”
CoachKandSportsguy
09-08-2024, 04:27 PM
So very true. Why work if you cannot keep what you make?
If they made more they buy more stuff and that would lead to more jobs.
So not many workers in the 1930's through 1970's when the highest income tax rate was 70%+?
behavioral economics has proven that people will work as hard as needed to get to their own individual sufficing income level. After that, they will not work harder. Nothing to do with tax rates.
Historical Income Tax Rates | Wolters Kluwer (https://www.wolterskluwer.com/en/expert-insights/whole-ball-of-tax-historical-income-tax-rates)
note that tax rates declined for the top and increased for the bottom in the 1980s. You didn't stop working as your income tax rate increased in the 1980s did you?
Pugchief
09-08-2024, 04:30 PM
So you're in favor of just dissolving the UNITED States of America entirely right? That way -no- federal money funds ANY other state, because "Federal" would cease to exist. Let's have 50 countries, instead of a single country. And each country can deal with its own expenses.
Please don't put words in my mouth. I'm not in favor of dissolving the union, but show me where in the constitution it says that the Feds should be giving money to any state. The Feds have been taking more power from the states with time, and vastly exceeding their original authority and bloat.
Pugchief
09-08-2024, 04:33 PM
behavioral economics has proven that people will work as hard as needed to get to their own individual sufficing income level. After that, they will not work harder. Nothing to do with tax rates.
Please provide a link supporting your claim. It's actually the opposite. The famous Laffer Curve (https://en.wikipedia.org/wiki/Laffer_curve) is the gold standard in this regard.
Glowing Horizon
09-08-2024, 04:35 PM
Your lack of worry about any potential tax changes to those earning less than $400,000 ignores the fact that there are 88,000 new IRS agents, in addition to those already employed. Recently, tax audits of those with earnings under $400K have increased substantially. So they don’t need to increase the tax rates, etc. They’ll just wring it out of those they perceive as “wealthy” by ENFORCEMENT.
Glowing Horizon
09-08-2024, 04:42 PM
So you're in favor of just dissolving the UNITED States of America entirely right? That way -no- federal money funds ANY other state, because "Federal" would cease to exist. Let's have 50 countries, instead of a single country. And each country can deal with its own expenses.
50 states with each one’s voters deciding most of its own policies & funding WAS THE ORIGINAL INTENT of our founders. We have continually enabled federal bureaucracy to expand & take over individual states right to its own determination.
Glowing Horizon
09-08-2024, 04:45 PM
Remember the AMT??
The AMT was originally designed to tax high-income taxpayers who used the regular tax system to pay little or no tax. Due to inflation and cuts in ordinary tax rates, a larger number of taxpayers began to pay the AMT. The number of households owing AMT rose from 200,000 in 1982 to 5.2 million in 2017, but was reduced back to 200,000 in 2018 by the TCJA. After the expiry of the TCJA in 2025, the number of AMT taxpayers is expected to rise to 7 million in 2026.
AMT is a fancy way to play Robin Hood with the tax system—rob from the “rich” and give to the “poor”
Also known as progressivism, communism & redistribution.
Glowing Horizon
09-08-2024, 04:56 PM
Hogwash: “behavioral economics has proven that people will work as hard as needed to get to their own individual sufficing income level. After that, they will not work harder.”
That is NOT how actual wage earners act. That is how welfare recipients & recipients of government programs such as guaranteed minimum income act.
What you are describing is true in a communist system where the government owns the means of production—not a capitalist system where individuals own the means of production.
“You’ll own nothing & be happy” (World economic forum) is the source proponent of this ideology & it is not SCIENCE.
Globally, individuals are BEHAVING badly to rebuke this.
manaboutown
09-08-2024, 05:36 PM
"New Internal Revenue Service (IRS) data on individual income taxes for tax year 2021 shows the federal income tax system continues to be progressive as high-income taxpayers pay the highest average income tax rates. Average tax rates for all income groups remained lower in 2021, four years after the Tax Cuts and Jobs Act (TCJA), than they were in 2017 prior to the reform. The 2021 data also reflects changes in people’s incomes and in government policy during the coronavirus pandemic.
In 2021, taxpayers filed 153.6 million tax returns, reported earning more than $14.7 trillion in adjusted gross income (AGI), and paid nearly $2.2 trillion in individual income taxes.
The average income tax rate in 2021 was 14.9 percent. The top 1 percent of taxpayers paid a 25.9 percent average rate, nearly eight times higher than the 3.3 percent average rate paid by the bottom half of taxpayers.
The top 1 percent’s income share rose from 22.2 percent in 2020 to 26.3 percent in 2021 and its share of federal income taxes paid rose from 42.3 percent to 45.8 percent.
The top 50 percent of all taxpayers paid 97.7 percent of all federal individual income taxes, while the bottom 50 percent paid the remaining 2.3 percent.
The 2021 figures include pandemic-related tax items from the American Rescue Plan Act (ARPA), such as the non-refundable part of the third round of Recovery Rebates and the expanded child tax credit (CTC) and earned income tax credit (EITC).
Capital gains realizations exceeded $2 trillion to reach a 40-year high, driving income growth and taxes paid for high-income groups."
From: Who Pays Federal Income Taxes? Latest Federal Income Tax Data (https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/)
Caymus
09-08-2024, 05:38 PM
There is a large amount of data out there that shows that the high tax states like NY and CT were already paying more than they were getting back and the red states were getting more than they were paying. I'm not sure where FL sits in that data, and I am not going to look it up when there is football to be watched.
Does that include all the military contracts that CT receives? General Dynamics, Raytheon and others receive $Billions.
rsmurano
09-08-2024, 06:01 PM
I don’t buy it that a person stops working when they reach their salary goal. My salary goal in the early 70’s when I started working was a heck of a lot lower than what it was when I retired. Luckily, I made really good money but my employer was counting on me to perform and to make them money, or what good was I to the company?
I would have been a fool to stop pushing my limits in my ability to earn more money and to be an asset to the company.
Now the people who don’t want to work, they just want to leach off the system, with no goals in sight and no ambition to better yourself.
Pugchief
09-08-2024, 06:38 PM
I don’t buy it that a person stops working when they reach their salary goal. My salary goal in the early 70’s when I started working was a heck of a lot lower than what it was when I retired. Luckily, I made really good money but my employer was counting on me to perform and to make them money, or what good was I to the company?
I would have been a fool to stop pushing my limits in my ability to earn more money and to be an asset to the company.
Now the people who don’t want to work, they just want to leach off the system, with no goals in sight and no ambition to better yourself.
See post #61
OrangeBlossomBaby
09-08-2024, 06:44 PM
I don’t buy it that a person stops working when they reach their salary goal. My salary goal in the early 70’s when I started working was a heck of a lot lower than what it was when I retired. Luckily, I made really good money but my employer was counting on me to perform and to make them money, or what good was I to the company?
I would have been a fool to stop pushing my limits in my ability to earn more money and to be an asset to the company.
Now the people who don’t want to work, they just want to leach off the system, with no goals in sight and no ambition to better yourself.
I worked mostly retail. But I also was a busker (street/subway musician), and did some years in secretarial positions in a few offices. I never -ever- worked more than I felt I needed to in order to live my life the way I wanted to live it. When I was offered more money for more responsibility, I usually rejected the offer. When I earned what I needed as a musician, I closed my guitar case and went home for the day. I had no "career goals," just as most working class people have no "career goals." They want to pay the bills, enjoy a weekend at the movies or dancing or a dinner out, and save up a little something for their retirement.
I worked overtime sometimes because the money was good and I had something in mind to buy with it. But if I didn't, I didn't. There was no pressure, I didn't struggle to make ends meet, but I also had no stress in constantly having to work more, harder, earn more, get promoted, rise in the ranks, get the better office, drive the nicer car, blah blah blah.
askcarl
09-08-2024, 09:36 PM
It’s not if, but when, the consequences of fiscal (and monetary) insanity finally manifest themselves. The recent bout of hyper inflation was just a sneak preview.
And now they are ready to slash interest rates to levels below real rates of return yet again, inflating the bubble even more before it eventually bursts.
Recent Hyper Inflation? 9% ???
In 1970, it reached 5.5% and then continued to trend up in a range from 5.5–14.4% through the 1970s before culminating at 14% in 1980.
Just the facts.....
Aces4
09-09-2024, 10:23 AM
Recent Hyper Inflation? 9% ???
In 1970, it reached 5.5% and then continued to trend up in a range from 5.5–14.4% through the 1970s before culminating at 14% in 1980.
Just the facts.....
Let's face it, the inflation statistics in 1970 and 1980 were far more factual that the inflation statistics provided now.
GoRedSox!
09-09-2024, 01:12 PM
Your lack of worry about any potential tax changes to those earning less than $400,000 ignores the fact that there are 88,000 new IRS agents, in addition to those already employed. Recently, tax audits of those with earnings under $400K have increased substantially. So they don’t need to increase the tax rates, etc. They’ll just wring it out of those they perceive as “wealthy” by ENFORCEMENT.I have been doing my own taxes for over 45 years since my first job. I have never been audited, and I don't cheat on my taxes, so I'm not worried about being audited. The IRS can hire as many additional agents as they wish. Many of these agents are replacements for the ones who have left over the years leaving them severely understaffed. I pay my taxes, no one who pays theirs has any reason to worry. And I hope these agents find audit plenty of those who are not paying their legitimate taxes.
tophcfa
09-09-2024, 02:58 PM
Recent Hyper Inflation? 9% ???
In 1970, it reached 5.5% and then continued to trend up in a range from 5.5–14.4% through the 1970s before culminating at 14% in 1980.
Just the facts.....
Hmmm, just the facts as reported by the same entity that has the most debt on the entire planet and is the biggest beneficiary of low interest rates. Talk about a conflict of interest distorting objectivity.
If you want “Just the facts….” about inflation, go to the grocery store and look at the prices of healthy low carb foods like lean proteins, fruits, and vegetables.
OrangeBlossomBaby
09-09-2024, 05:57 PM
Your lack of worry about any potential tax changes to those earning less than $400,000 ignores the fact that there are 88,000 new IRS agents, in addition to those already employed. Recently, tax audits of those with earnings under $400K have increased substantially. So they don’t need to increase the tax rates, etc. They’ll just wring it out of those they perceive as “wealthy” by ENFORCEMENT.
It's easy to ignore things that aren't facts.
1. It's 87,000, not 88,000
2. They're not all agents.
3. The plan was to have 87,000 new IRS employees BY 2031. It's only 2024, we don't have 87,000 new IRS employees, agents or otherwise.
4. MOST of the new hires were to fill vacancies, NOT in addition to the current roster. Many employees retire, and those jobs need to be filled.
5. Political propaganda is not allowed here.
You can read the actual facts here though:
Are 88,000 New IRS Agents Coming for Your Tax Dollars? | Kiplinger (https://www.kiplinger.com/taxes/605107/new-irs-agents-and-the-inflation-reduction-act)
Pugchief
09-09-2024, 06:36 PM
Your lack of worry about any potential tax changes to those earning less than $400,000 ignores the fact that there are 88,000 new IRS agents, in addition to those already employed. Recently, tax audits of those with earnings under $400K have increased substantially. So they don’t need to increase the tax rates, etc. They’ll just wring it out of those they perceive as “wealthy” by ENFORCEMENT.
5. Political propaganda is not allowed here.
How was that post "political propaganda"?
spinner1001
09-10-2024, 01:37 AM
How was that post "political propaganda"?
“Because I disagree with it.” /sarc
Blueblaze
09-10-2024, 06:29 AM
Don't worry. It will only effect those rich guys "making over $400K/year".
However, it might be wise to remember that when the 16th Amendment was ratified, less than 1% of all Americans were "rich" enough to have to pay the new "Income Tax".
Never forget -- they think your money is their money. It's not about how much you have to pay, but how much they'll let you keep. Why else do they whine about who's going to "pay" for a tax cut? You certainly can't expect them to cut their spending!
God only asks for 10%. Our great politicians would never limit themselves to mere god-like status!
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