(03-30-2022 12:37 PM)Rice93 Wrote:  

(03-30-2022 12:24 PM)Owl 69/70/75 Wrote:  

(03-30-2022 11:59 AM)Rice93 Wrote:  I think that a general effort to limit ways that the wealthy can avoid taxes on income is welcomed.

Why?

For fairness, first of all. Do you think it's fair for a cardiologist who makes $550k and pays 39% of that back in taxes whereas a billionaire can take loans out on his wealth and pay little to no taxes on this "income".

So do we tax people who take out a home equity loan?

Based on your answer, you either do not fully understand the difference between wealth and income, or you do not understand the what income is with regard to the idea of 'income tax'.

First, income tax is first, and foremost, a tax on an accretion of wealth based on a transfer.

Normal income is a transfer of work for money.

Barter is a transfer of work (or value) for another value. (think of my work with startups that I do for warrants -- work for warrant value)

When I find a diamond ring in a piano I bought, that is a value (diamond ring) based on a transfer.

If I find oil on my land, that is inherent to the property -- and taxed on a transfer (i.e. when pumped and sold to a third party).

When you talk of loans against stock, there is no accretion of wealth. You get money, which is offset in its entirety by the liability. No net increase in wealth --- only a change in form.

So no, I disagree absolutely that loan amounts are 'income'. If so, then any home equity loan should be taxed as income, which we can all agree is stupid as sin. Not just that, but if I put up anything of value as collateral for a loan, under that rubric any collateralized loan should be viewed as income. So no, I dont buy the predicate.

Quote:We all enjoy the benefits that our tax dollars provide. I don't think it's fair that some people (both the very wealthy and the not-so-wealthy) receive these benefits for free.

How does one 'receive them for free'? Precisely, what are these benefits that are 'free'? Please do tell, I want to know where and how to sign up for this gravy train that you speak of....

If you say 'many rich people pay no taxes' -- that isnt an answer. If you are the recipient of net losses, sometimes those accrue to zero out gross income. But at the end, their is no accretion of wealth, so it makes perfect sense in those situations to have zero income taxes. Bummer.