(05-15-2015 09:51 AM)HeartOfDixie Wrote:  In all honesty, the whole "taxed already" argument holds no water.

If you are a stakeholder in a corporation, a C corporation to be more specific, you essentially pay taxes twice. Nobody thinks that is unfair.

Double taxation occurs in a fair number of places. It isn't inherently unfair.

It absolutely holds water. Inheritance money was taxed when earned. If the same already taxed principle is passed on, why does the government have any further claim to it?

In most cases with a C corp its the dividends (which represents a gain) that at taxed for the individual shareholder, not the initial investment. Technically double taxation... sure, but the same entity is not paying the tax on the same money twice. It's first paid by the corp upon being earned, then paid by the individual shareholder on his dividend earned.

(05-15-2015 09:53 AM)Machiavelli Wrote:  This is the problem and it's truly the reason we need a flat tax for the vast majority and it should be a national sales tax. If you want pre fund a certain rebate for lower income levels that's ok. If you want to keep a income tax for the ultra wealthy. Like the top 10% I'm ok with that too. You'll never get our legislature to pass it though because there is too much power in granting the write offs.

The tax laws should be scrapped and we should start from scratch. It's entirely to convoluted.

(05-15-2015 09:58 AM)200yrs2late Wrote:  

(05-15-2015 09:51 AM)HeartOfDixie Wrote:  In all honesty, the whole "taxed already" argument holds no water.

If you are a stakeholder in a corporation, a C corporation to be more specific, you essentially pay taxes twice. Nobody thinks that is unfair.

Double taxation occurs in a fair number of places. It isn't inherently unfair.

It absolutely holds water. Inheritance money was taxed when earned. If the same already taxed principle is passed on, why does the government have any further claim to it?

In most cases with a C corp its the dividends (which represents a gain) that at taxed for the individual shareholder, not the initial investment. Technically double taxation... sure, but the same entity is not paying the tax on the same money twice. It's first paid by the corp upon being earned, then paid by the individual shareholder on his dividend earned.

Period. The end.

When you die it isn't the same entity that pays the tax either.

(05-15-2015 09:54 AM)Fitbud Wrote:  

(05-15-2015 09:49 AM)blunderbuss Wrote:  

(05-15-2015 09:43 AM)Fitbud Wrote:  

(05-14-2015 10:29 PM)blunderbuss Wrote:  

(05-14-2015 03:46 PM)Fitbud Wrote:  Perhaps you make a lot of money but in my neck of the woods, anyone who makes 300k to 1 millon dollars IS rich.

My wife and I combined have never ever ever even come close to making 100k in one year and my students think WE are rich because I have a two story house with a pool and three cars.

You're not smart with your money.

I'm not smart with my money? Why?

You threw it all out there.

Care to answer the question?

Like somebody else said, if it's all or at least mostly paid for you're smart with your money. If you're still paying on it you're not.

(05-15-2015 09:52 AM)200yrs2late Wrote:  

(05-15-2015 09:40 AM)Machiavelli Wrote:  Why is income from wealth taxed at 15% while labor is higher. That should be reversed in any form of fairness.

Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

(05-15-2015 10:05 AM)Fitbud Wrote:  

(05-15-2015 09:52 AM)200yrs2late Wrote:  

(05-15-2015 09:40 AM)Machiavelli Wrote:  Why is income from wealth taxed at 15% while labor is higher. That should be reversed in any form of fairness.

Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

"new" money does get taxed.

(05-15-2015 10:05 AM)Fitbud Wrote:  

(05-15-2015 09:52 AM)200yrs2late Wrote:  

(05-15-2015 09:40 AM)Machiavelli Wrote:  Why is income from wealth taxed at 15% while labor is higher. That should be reversed in any form of fairness.

Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

Interest IS taxed as income (1040 line 8). So are dividends (line 9). Short term capital gains are taxed as income (line 13). They are all taxed at the full marginal rate.

Capital gains are taxed at the rate of either 15% or 20% depending upon adjusted income.

Glad to be of help in your understanding of tax rates.

(05-15-2015 10:05 AM)Fitbud Wrote:  

(05-15-2015 09:52 AM)200yrs2late Wrote:  

(05-15-2015 09:40 AM)Machiavelli Wrote:  Why is income from wealth taxed at 15% while labor is higher. That should be reversed in any form of fairness.

Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

There's no "interest earned" in inheritence. Any gains since the last tax period are taxed to the estate before the money is passed on. Therefore, not new money.

(05-15-2015 10:01 AM)HeartOfDixie Wrote:  

(05-15-2015 09:58 AM)200yrs2late Wrote:  

(05-15-2015 09:51 AM)HeartOfDixie Wrote:  In all honesty, the whole "taxed already" argument holds no water.

If you are a stakeholder in a corporation, a C corporation to be more specific, you essentially pay taxes twice. Nobody thinks that is unfair.

Double taxation occurs in a fair number of places. It isn't inherently unfair.

It absolutely holds water. Inheritance money was taxed when earned. If the same already taxed principle is passed on, why does the government have any further claim to it?

In most cases with a C corp its the dividends (which represents a gain) that at taxed for the individual shareholder, not the initial investment. Technically double taxation... sure, but the same entity is not paying the tax on the same money twice. It's first paid by the corp upon being earned, then paid by the individual shareholder on his dividend earned.

Period. The end.

When you die it isn't the same entity that pays the tax either.

When an individual dies and passes on money, it's not quite the same. The recipient of the inheritance did not 'invest' capital with an expectation of return from the person who passed away. It' simply a change in ownership which is where many, myself included, have a problem with the government staking a claim to tax the money or any property again. I'm not a fan of tax bases resetting when inheriting property either.

(05-15-2015 10:29 AM)200yrs2late Wrote:  

(05-15-2015 10:01 AM)HeartOfDixie Wrote:  

(05-15-2015 09:58 AM)200yrs2late Wrote:  

(05-15-2015 09:51 AM)HeartOfDixie Wrote:  In all honesty, the whole "taxed already" argument holds no water.

If you are a stakeholder in a corporation, a C corporation to be more specific, you essentially pay taxes twice. Nobody thinks that is unfair.

Double taxation occurs in a fair number of places. It isn't inherently unfair.

It absolutely holds water. Inheritance money was taxed when earned. If the same already taxed principle is passed on, why does the government have any further claim to it?

In most cases with a C corp its the dividends (which represents a gain) that at taxed for the individual shareholder, not the initial investment. Technically double taxation... sure, but the same entity is not paying the tax on the same money twice. It's first paid by the corp upon being earned, then paid by the individual shareholder on his dividend earned.

Period. The end.

When you die it isn't the same entity that pays the tax either.

When an individual dies and passes on money, it's not quite the same. The recipient of the inheritance did not 'invest' capital with an expectation of return from the person who passed away. It' simply a change in ownership which is where many, myself included, have a problem with the government staking a claim to tax the money or any property again. I'm not a fan of tax bases resetting when inheriting property either.

You can say it is not quite the same, and in a moral sense it is not. However, it is a separate entity.

You hit on an important point, money is taxed not based on its 'newness' but when it changes hands. That's the basis of tax law.

Look, I am not a fan of the inheritance tax either but there are certain arguments against it that fly and others that don't.

As I said, a modification of the rule against perpetuities takes care of all of this in a fair manner. You pass on however much money you wish to your children, and given the vesting it ensure that it passes on to your grandchildren. However, it does not pass on to your great grandchildren, at that point it dies.

In that scenario you are able to work and provide for you family after your death but we do avoid the actual problem of money that lives forever.

We don't let land lay fallow and last forever, why should we let money? It isn't good and the rationale is the same.

(05-15-2015 10:29 AM)200yrs2late Wrote:  

(05-15-2015 10:01 AM)HeartOfDixie Wrote:  

(05-15-2015 09:58 AM)200yrs2late Wrote:  

(05-15-2015 09:51 AM)HeartOfDixie Wrote:  In all honesty, the whole "taxed already" argument holds no water.

If you are a stakeholder in a corporation, a C corporation to be more specific, you essentially pay taxes twice. Nobody thinks that is unfair.

Double taxation occurs in a fair number of places. It isn't inherently unfair.

It absolutely holds water. Inheritance money was taxed when earned. If the same already taxed principle is passed on, why does the government have any further claim to it?

In most cases with a C corp its the dividends (which represents a gain) that at taxed for the individual shareholder, not the initial investment. Technically double taxation... sure, but the same entity is not paying the tax on the same money twice. It's first paid by the corp upon being earned, then paid by the individual shareholder on his dividend earned.

Period. The end.

When you die it isn't the same entity that pays the tax either.

When an individual dies and passes on money, it's not quite the same. The recipient of the inheritance did not 'invest' capital with an expectation of return from the person who passed away. It' simply a change in ownership which is where many, myself included, have a problem with the government staking a claim to tax the money or any property again. I'm not a fan of tax bases resetting when inheriting property either.

My 90 year old grandmother owns 3 rental properties which will pass on to her children when she dies and the basis will be reset. It makes sense to me to reset the property value at the time of inheritance because my dad and his siblings never bought the property at the old values, they will only own it from the day of inheritance on.

(05-15-2015 10:17 AM)QuestionSocratic Wrote:  

(05-15-2015 10:05 AM)Fitbud Wrote:  

(05-15-2015 09:52 AM)200yrs2late Wrote:  

(05-15-2015 09:40 AM)Machiavelli Wrote:  Why is income from wealth taxed at 15% while labor is higher. That should be reversed in any form of fairness.

Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

Interest IS taxed as income (1040 line 8). So are dividends (line 9). Short term capital gains are taxed as income (line 13). They are all taxed at the full marginal rate.

Capital gains are taxed at the rate of either 15% or 20% depending upon adjusted income.

Glad to be of help in your understanding of tax rates.

Isn't that what I just said?

(05-15-2015 10:41 AM)Fitbud Wrote:  

(05-15-2015 10:17 AM)QuestionSocratic Wrote:  

(05-15-2015 10:05 AM)Fitbud Wrote:  

(05-15-2015 09:52 AM)200yrs2late Wrote:  

(05-15-2015 09:40 AM)Machiavelli Wrote:  Why is income from wealth taxed at 15% while labor is higher. That should be reversed in any form of fairness.

Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

Interest IS taxed as income (1040 line 8). So are dividends (line 9). Short term capital gains are taxed as income (line 13). They are all taxed at the full marginal rate.

Capital gains are taxed at the rate of either 15% or 20% depending upon adjusted income.

Glad to be of help in your understanding of tax rates.

Isn't that what I just said?

No you didn't. You said that income from wealth is taxed at 15% and I corrected you by pointing out that it is taxed at the full income level.

(05-15-2015 10:53 AM)QuestionSocratic Wrote:  

(05-15-2015 10:41 AM)Fitbud Wrote:  

(05-15-2015 10:17 AM)QuestionSocratic Wrote:  

(05-15-2015 10:05 AM)Fitbud Wrote:  

(05-15-2015 09:52 AM)200yrs2late Wrote:  Simple. "Wealth" has already been taxed when it was initially earned.

But intrest earned on that money is new money and therefore should be taxed.

Interest IS taxed as income (1040 line 8). So are dividends (line 9). Short term capital gains are taxed as income (line 13). They are all taxed at the full marginal rate.

Capital gains are taxed at the rate of either 15% or 20% depending upon adjusted income.

Glad to be of help in your understanding of tax rates.

Isn't that what I just said?

No you didn't. You said that income from wealth is taxed at 15% and I corrected you by pointing out that it is taxed at the full income level.

Try again.

(05-15-2015 10:53 AM)Fitbud Wrote:  

(05-15-2015 10:53 AM)QuestionSocratic Wrote:  

(05-15-2015 10:41 AM)Fitbud Wrote:  

(05-15-2015 10:17 AM)QuestionSocratic Wrote:  

(05-15-2015 10:05 AM)Fitbud Wrote:  But intrest earned on that money is new money and therefore should be taxed.

Interest IS taxed as income (1040 line 8). So are dividends (line 9). Short term capital gains are taxed as income (line 13). They are all taxed at the full marginal rate.

Capital gains are taxed at the rate of either 15% or 20% depending upon adjusted income.

Glad to be of help in your understanding of tax rates.

Isn't that what I just said?

No you didn't. You said that income from wealth is taxed at 15% and I corrected you by pointing out that it is taxed at the full income level.

Try again.

I'm sorry if this is difficult for you to understand.

(05-15-2015 10:56 AM)QuestionSocratic Wrote:  

(05-15-2015 10:53 AM)Fitbud Wrote:  

(05-15-2015 10:53 AM)QuestionSocratic Wrote:  

(05-15-2015 10:41 AM)Fitbud Wrote:  

(05-15-2015 10:17 AM)QuestionSocratic Wrote:  Interest IS taxed as income (1040 line 8). So are dividends (line 9). Short term capital gains are taxed as income (line 13). They are all taxed at the full marginal rate.

Capital gains are taxed at the rate of either 15% or 20% depending upon adjusted income.

Glad to be of help in your understanding of tax rates.

Isn't that what I just said?

No you didn't. You said that income from wealth is taxed at 15% and I corrected you by pointing out that it is taxed at the full income level.

Try again.

I'm sorry if this is difficult for you to understand.

It's Friday and I'm in a good mood so I"m going to be nice.

I never said that, you have me mixed up with someone else.

(05-15-2015 10:59 AM)Fitbud Wrote:  

(05-15-2015 10:56 AM)QuestionSocratic Wrote:  

(05-15-2015 10:53 AM)Fitbud Wrote:  

(05-15-2015 10:53 AM)QuestionSocratic Wrote:  

(05-15-2015 10:41 AM)Fitbud Wrote:  Isn't that what I just said?

No you didn't. You said that income from wealth is taxed at 15% and I corrected you by pointing out that it is taxed at the full income level.

Try again.

I'm sorry if this is difficult for you to understand.

It's Friday and I'm in a good mood so I"m going to be nice.

I never said that, you have me mixed up with someone else.

Opps, my apologies. That was a post from Mach.

However, I kind of conflate you and Mach. You two seem interchangeable.

(05-15-2015 12:17 PM)QuestionSocratic Wrote:  

(05-15-2015 10:59 AM)Fitbud Wrote:  

(05-15-2015 10:56 AM)QuestionSocratic Wrote:  

(05-15-2015 10:53 AM)Fitbud Wrote:  

(05-15-2015 10:53 AM)QuestionSocratic Wrote:  No you didn't. You said that income from wealth is taxed at 15% and I corrected you by pointing out that it is taxed at the full income level.

Try again.

I'm sorry if this is difficult for you to understand.

It's Friday and I'm in a good mood so I"m going to be nice.

I never said that, you have me mixed up with someone else.

Opps, my apologies. That was a post from Mach.

However, I kind of conflate you and Mach. You two seem interchangeable.

No problem.

So as I'm looking at retiring next year, I understand My pension is taxed as well as My pre tax savings 401k plan. But the Kicker is with My voluntary Pension 3% pay in plan. The is paid in with After Tax money and yet when I take the Lump Sum payout, The IRS will require a 20% withdrawal payment up front on My money I've already paid the Tax on. We aren't talking the interest earned but the entire lump sum is taxed 20%. I'm told I can claim it or some back when filing My return. Mind Boggling at best. We need Tax relief for those that have been paying in for 4-5 decades.

(05-15-2015 12:30 PM)CardFan1 Wrote:  So as I'm looking at retiring next year, I understand My pension is taxed as well as My pre tax savings 401k plan. But the Kicker is with My voluntary Pension 3% pay in plan. The is paid in with After Tax money and yet when I take the Lump Sum payout, The IRS will require a 20% withdrawal payment up front on My money I've already paid the Tax on. We aren't talking the interest earned but the entire lump sum is taxed 20%. I'm told I can claim it or some back when filing My return. Mind Boggling at best. We need Tax relief for those that have been paying in for 4-5 decades.

If your pay in money is being taxed then you got hosed. You should be able to pay in up to 10% before taxes.