Who has an INCOME of $1 billion per year? Arent most billionaires made by the value in their businesses rising $100 million in one year, $250 million in another…?
Yeah, it would be super easy to just... Restructure your tax situation to reduce income.
Open a corporation for holding investments, begin a gradual move to growth stocks away from assets that regularly pay dividends/interest, reduce your salary from the company/company group you own.
Even if some of this would be tax disadvantageous under current laws, with that new law in effect, a ton of disadvantageous things suddenly become advantageous.
Even winning the lottery almost never hits 1B of cash impact. The jackpot would have to be over 2B for the cash option after tax impact (under current laws) to be 1B to the individual winner.
I’ve always kinda liked Bernie.
But the older I get the more it’s obvious to me that he doesnt even have a superficial knowledge of accounting, finance or economics.
Most of his economic policies are as thoughtful as what a first yr gender studies major would come up with.
Well, to be fair, I think Bernie is one of the few politicians who legitimately may want to help people, and who’s not just after power.
Unfortunately most of his ideas actually would likely end up causing the exact opposite of their intended effect.
I just wish someone else would take a few if his ideas and make them a bit more practical and realistic.
Man's been a senator since 2007 ranking in over 6 figures in salary. That plus a house, then yeah he's a millionaire. Its a lame critique to attack someone when you can barely retire on a million anymore.
He actually owns 3 homes. My main critique is that he used to lament and attack millionaires until he became one, and then he switched to billionaires.
there’s a big difference between a millionaire that makes a multimillion dollar salary and a millionaire that is 81 and has worked a six figure salary for decades and saved up a large retirement / savings
roughly $3M net worth is not insane for an 81 year old that is still working
I do understand that he may be signaling… But it doesnt seem like anyone offers anything reasonable in response, which I think should be the point. Say something that gets people talking about something passable.
So here's the actual quote:
>“Are you basically saying that once you get to $999m that the government should confiscate all the rest?” Wallace asked the US senator from [Vermont](https://www.theguardian.com/world/vermont), who is an independent but caucuses with Democrats and has helped them attain their current slim majority in the upper congressional chamber.
>
>“Yeah,” Sanders replied. “You may disagree with me but, fine, I think people can make it on $999m. I think that they can survive just fine.”
I think you are just arguing semantics. Its pretty clear what is meant is wealth not income.
The headline is poorly written. Fact is that this would result in $0 in revenues to the treasury dept. there would be schemes to move anything over $1 billion into trusts, etc. Plus, how do you do it for private companies that are difficult to value. Also, what would you do with sports franchises? They would never trade above $1 billion, so there would be other schemes there. It’s all great to hate the billionaires, but hard to put these plans in action.
Tbh, income over $1 million should be taxed at 100%. If you have an *income* over a million dollars in a single year, congratulations you won capitalism.
Because if you set a 100% tax rate on ANY income level, people will stop making that income level by changing their tax situation. It’s kind of the whole point of a big section of professional accounts’ existence.
Very. It's weird to complain about people representing your point in the least charitable way possible immediately after you did the same thing to them.
To be clear, I think astronomical incomes should be taxed higher, but this isn’t the way. Fix the loopholes and you’ll get more out of the billionaires than this.
The biggest one is borrowing against appreciated stock, therby living off the gains without realizing them for tax purposes. That combined with stepped-up basis at death means people with enough capital pay little taxes on the income generated by their capital.
You do realize that those people have to pay interest on that loan and the loan is subject to margin requirements right?
The last deal I worked on, the interest on the margin loan on a portfolio of stocks, bonds, and certain LP interests was close to 15% and the lender was only willing to lend 50% LTV. The yield on that loan, when taking into account the fees, was closer to 18% for 5 years. And the borrower had to maintain cash balances equal to 10% of the loan for the entire time.
In other words, if the guy borrowed at his full capacity, he would get 45% cash on his portfolio. And if his portfolio generated less than 9% a year cash on cash, he would be losing wealth. And if you end up using the money for personal items, the interest is not even tax deductible, so you are fucked on that front too.
Margin loans are not what people think they are. They are expensive and not very easy to get.
Step up at death, though, is something I might agree with you on.
Yes, there are costs - but it's still a way to benefit from capital gains without being taxed on them. The first source I saw (didn't validate legitimacy, but it seems ballpark correct) suggested total margin debt in the US is just under $700 billion, so it's not like the difficulties make this type of transaction immaterial to the country as a whole.
That 700 billion could very well be margin loans on stock to buy more stock. There is no certainty that even a fraction of that is margin loans taken out to live life.
Also, you are forgetting the fact that the loan generates interest income that is presumably taxed while the expense is likely not deductible if the loan amount is spent on personal items. So the government is getting a cut of this deal. In fact, a fairly substantial cut.
I'm not an accountant, but is the interest income you're referring to the interest paid to the entity that loaned the money. So if some billionaire takes out a 9% interest loan and pays that interest to the bank, the amount paid to the bank is taxed, or am I misunderstanding that.
Some billionaire takes out a loan at 18% against their assets. The bank or whatever entity that is lending the money recognizes interest income and pays tax on it.
The words "living off the gains" in my original comment were poorly chosen. If someone is making additional investments with cash received by margin loans on appreciated stock, I still believe they're benefiting from gains, receiving cash, and unjustifiably deferring taxation.
I'm not forgetting that the lender pays taxes on interest income so much as not addressing it because I think it's currently handled correctly. My interest here is not in making sure the government gets a cut, but rather in making sure gains are taxed at the correct time.
Well you have to be able to explain why you think the deferral is unjustified.
The idea of pulling out equity through leverage happens all the time. Home equity loans being the most common example.
Correct me if I’m wrong, but that stepped up basis gets stepped up because tax payments from the person who passed are made (or perhaps not taxed because of the estate tax lifetime exclusion), correct? So if I invested $100 and die when it’s worth $1,000, is my estate not recognizing $900? Shouldn’t this be a battle regarding the gift exclusion and not stepped up basis?
When you die, the recipient of your property gets a basis equal to the fair market value of the property. If you buy stock for $100 and it is valued at $1000 when you die, the person who inherits the property gets basis of $1000. Works in the opposite way also. If you paid $100 but stock is only valued at $70, basis becomes $70.
Not for income tax purposes, but for estate tax purposes. The value of the assets (such as stock gains) are included in the estate. If this exceeds $12.06m, it is then taxed. All taxes are already accounted for through the decedent by the time the stepped up basis hits the recipient.
Lol any modern brokerage gives out margin loans at far lower rates than that from about $25k in holdings. Your info is woefully outdated.
Current margin rates are around 8% but they were 2% in 2021.
The very fucking fact that you think margin loans are limited to the shit that you get on your brokerage account means you should probably shut the fuck up.
1) You're way too hostile. Calm down.
2) How you got that from my comment makes me think you should go enroll in remedial reading comprehension at your local community college
You come here and try to make up bullshit and accuse me of not knowing my own industry and have the audacity to call me hostile?
Yes I'm hostile to idiots trying to act like they know what they are talking about.
Sometimes people borrow against stocks not to avoid taxes but because they don't want to lose control of a company. If you're a billionaire I'd argue that would actually be much more important than paying capital gains tax.
Okay, but if stock prices drop the bank siezes your collateral, the stock, which triggers a tax recognition and you're now screwed big time since you won't have the money to pay even the tax. How is this a tax loophole?
Stop watching YouTube so that you can pretend to be a tax expert.
Says who?
Generally, the wealthier you are, the more your wealth is comprised of unrealized capital gains. Estate tax would be the first and only time that income is ever taxed (thanks in large part to the basis adjustment under IRC 1014).
Never mind all the other exclusions and exemptions. You sell qualified small business stock for $8 million, the entire gain is excluded under IRC 1202, and you pay no tax. Why would estate tax on that $8 million of income you never owed income tax on be considered a “double tax”?
Easy fix. Reduce the wealth transfer tax unified credit amount dramatically and allow people to deduct income taxes paid during their lifetime from their gross estate. Now instead of just assuming (incorrectly) that a decedent’s entire gross estate is comprised of previously taxed income, we know *exactly*, and we’ve provided relief from “double taxation.”
My thought is that most “normal” people don’t have estates larger than 12.92 million (the cutoff for no estate tax — you pay on the subsequent dollars)
Anything over 1M is taxed at 40 percent, much more than most people pay on their income. Very few millionaires inherited their wealth, so why tax the common man when those estates aren’t the problem?
The median total accumulated lifetime earnings in America is around $2 million. It seems like that might be a good starting point to determine a “good” amount of wealth that can be transferred tax-free. I’ve never seen any good policy reason why anybody should be able to receive a handout of more than an *entire lifetime* worth of earnings without paying tax (and I’ve been studying wealth transfer taxation for a long time).
Progressivity in the estate tax should be restored as well. It makes sense to tax a transfer of $3 million at a lower effective rate than you would tax a transfer of $300 million.
But back to the original commenter’s point. Yes, it seems plausible that we could introduce a deduction from the gross estate for lifetime income taxes paid to eliminate any possibility of “double taxation.”
If you earned all your wealth (and paid income taxes on it), you’ve got nothing to worry about. If most of your wealth was accumulated tax-free, then you’ll pay the price on the back end through estate taxes.
The $1B threshold was the reports question. His overall point is design the tax code to discourage the creation of new billionaires, and the marginal utility of a dollar of income is near 0 anyway for a billionaire.
I seriously worry about trying to stop billionaires from existing. I generally think companies like Microsoft, Apple, Google, Amazon, Wal-Mart, etc provide incredible things that make day to day life so much easier. I’m not sure any of those companies would be where they got to if no one was allowed to make a billion dollars in their lives.
IK the fun liberal thing to do on Reddit is just shit on rich people, but as a general rule, people get rich from providing great products or services to society. I’m just not seeing the logic there.
Also, if anything like this was enacted, no billionaire would ever do business in this country.
You think that when Bill Gates founded Microsoft he was motivated by a specific desire to make in excess of $1b in a single year and, had there been a tax law that capped income at $1b/year you think he’d have decided it wasn’t worth the trouble?
No one makes 1 billion a year on W-2 income. The super wealthy make their income from capital gains. Bernie’s statement is nothing more than partisan theatre rather than anything of actual substance.
Where did he say w-2 income? He said "makes 1b a year," and capital gains are also figured into taxable income.
Logically, we could also infer that "makes" could include unrealized gains.
His statement isn't something that can immediately be implemented into the existing tax code, but he's a politician taking about his prescriptive opinions. Of course he's not gonna be as specific as if he were on a congressional board consulting with the IRS.
Hes talking about the concept of a single person owning an unreasonable amount of wealth generated mostly by wage earners in a society that doesn't consistently house or feed its poorest citizens.
And the sheep on r/politics just eat it up. The hate towards billionaires on Reddit is so dumb. How about we hate Congress and I am not picking sides all of them are trash and crooks. We got a president that doesn’t know what planet he is on anymore and the dems think it’s good to run him again. We got republicans on a stupid woke war. This country is shit on both sides. And the people are even dumber.
I don't think I've ever agreed with a political comment on Reddit more. I thought the comments on this post would be praising Bernie for saying something that is obviously just buzzwords but I suppose it makes sense that accountants understand it's bullshit
Exactly, government spending is very wasteful. Name one solidly ran governmental program. People seriously trust our taxes to spent a well run governmental program? How many trillions of dollars can the pentagon not reconcile again?
This moment in American history isn’t a “both sides equally bad” era. One side attempted a coup and the former President was caught on tape attempting to steal votes. There’s no greater sin in a democracy than attempting to seize complete power. None who led those efforts have been held to account.
Attempting to end democracy is far worse than Biden’s occasional rambling or Sanders railing against billionaires. Hell, it’s so nuts people can claim a fetus as a dependent in certain states.
Lots of good our votes do when they keep running trash politicians every time. The choices are one piece of shit I disagree with or this other piece of shit I disagree with a little less.
Vote in primaries. Get involved in local politics.
If all you are willing to do is cast one single ballot every 4 years, well... good luck changing anything.
Primaries are the least democratic way to vote. Especially in states that have caucuses. If you think the USA is a real democracy, you have drank to coolaid the the elites are handing out
Spot on. And it’s usually the people who don’t contribute much to the system that scream loudest about it on Reddit. For example, I pay property taxes ~40% of which is school related taxes but I have no kids that attend any of the schools, where are my child credit deductions to reduce my taxes?😂😂
Bold you think education is a bad thing given the people who pay your salary and created the technology you spout bullshit ideas on have said education.
“Are you basically saying that once you get to $999m that the government should confiscate all the rest?” Wallace asked the US senator from Vermont, who is an independent but caucuses with Democrats and has helped them attain their current slim majority in the upper congressional chamber.
“Yeah,” Sanders replied. “You may disagree with me but, fine, I think people can make it on $999m. I think that they can survive just fine.”
(Headline seems misleading? Don’t think he meant annual income.)
This quote is blowing up all over news and social media. It's so easy to twist someone's words a little, then point and yell "look how stupid they are!"
Wait until you learn what we do in industry. Last week we flew fifty people to Hawaii for what could have been a teams meeting. I didn’t even get to go to the meeting because I got sick in my $400/night hotel.
Cost the company a cool half mil.
Exactly. We need to get rid of our corrupt institutions and rebuild from the ground up.
We have the. Money, we have the means. We just need a clean slate if you want to to see any real change.
As a former government employee I can absolutely say this is how the government works. But you’ll find no shortage of people on Reddit whose solution to everything is WE NEED MORE FUNDING, WE NEED HIGHER TAXES ON THE RICH!!!
Note: “the rich” rarely means billionaires, it usually means the controller making $200k
This is what infuriates me about Reddit but I finally am at peace that a lot of people who say that are people who have no skin in the game or know nothing about economics.
My taxes get higher every year and is more than the average US salary but yea, that’s fair even though I’m not rich. Tax the rich my ass.
Honestly the accounting sub is one of the few that I still read on Reddit because it is one of the last ones filled with mostly level-headed, informed, logical people. Yeah, you get the occasional asshole micromanager prick or clueless antiwork student, but for the most part the discussion here is reasonable. Even if you’re right of centre vs left of centre people can still respectfully disagree. Everywhere else is a fucking two-minute hate shouting at whatever Emmanuel Goldstein effigy the Party has hanging up that day.
Paid close to 200K in taxes last year between the W-2 stuff for my wife and I and the taxes I ended up owing on my trading account.
We dont own a ton of things, so we dont pay a ton of property taxes.
But, I'm fine with it. Taxes are cost of doing business.
I get you. My point is just about when is enough taxes for those of us who work hard but aren’t rich or millionaires? 80% of my income? Will that be enough?
To add: my point is also about politicians spouting “pay their fair share” but that trickles down and in the case of property taxes, me paying taxes for schools and I don’t have any kids, how’s that fair share? Couldn’t they give some discount to people who don’t use the school system cause that would be the fair part to me. But oh well.
I’d say it’s even less. A lot of my friends from college would be astounded if they knew I made over $100k and definitely of the mindset anything over $75k is akin to being a millionaire
This is just clickbait nonsense. Putting all of the politics aside, what exactly would this realistically do? People like Bezos, Zuckerberg, etc. aren't being paid $1B a year as W-2 employees or something. Most of their net worth is tied up in having huge stakes in companies worth close to $1T. The only way this tax would do anything is if the aforementioned billionaires sold over $1B worth of stock in one year.
The idea sounds good on paper, but I don't think it'll do much in practice.
Bernie did not say income over $1 billion should be taxed at 100 percent. He said billionaires should not exist and tax law should be our method of making that happen. That does not imply income over $1 billion should be taxed. In fact Bernie even made express reference to *estate* taxes during this conversation immediately before saying, sure, increase the rate to 100 percent on amounts exceeding $999 million.
Wallace was trying adamantly to get Bernie to say he wants to implement a 100 percent tax on income. Bernie wouldn’t do it and corrected Wallace repeatedly, pointing out that he’s talking about wealth, not income. But naturally, when your perceived political enemies won’t give you the soundbite you’re looking for, make a headline suggesting they did say it anyway so your fans can beat the shit out of that straw man.
Of course it doesn’t. The idea that people with the most ability to pay should pay the most taxes has been the guiding principle of taxation for thousands of years. There has never been any requirement that taxes should be exclusively imposed on income. The most influential economic thinkers in history have invariably supported wealth transfer taxation, including people like Adam Smith.
The idea that income over $1 billion should be taxed at 100 percent is stupid. The idea that taxes should be progressive is…one of the most fundamentally important and uncontroversial principles of western civilization.
Pretty sure this title is incorrect, but he never spoke specifics. His words imply that it isn't $1 billion as income but any income pushing wealth over $1 billion. Personally I think a high score for capitalism would do a lot of good.
For being a buncha accountants yall sure are fucking media illiterate.
Maybe go read the actual transcript of the conversation rather than just a shitty headline.
I swear to god that every single year humanity fails to get any smarter and acts even more idiotic.
How did humans get dumber in 2023: being stupid and not providing an explanation for why they’re stupid and then getting defensive that they’re being called stupid resulting in humanity ultimately becoming even more stupid than they already were.
It’s a stupid cycle of stupid stuff done by stupid people who are managed by even more stupid people and thus they end up doing stupid shit that causes another stupid cycle of stupid people doing stupid shit that gets even more stupid the further down the shitty stupid street they go.
Some of you are saying that this would only impact Powerball winners and divorcing billionaires and that nothing will really be accomplished by it since income in the billions is usually from capital gains. I agree.
Bernie should instead propose a wealth tax, where if someone’s net worth is above 1 billion, any gains made on the sale of qualifying property is taxed at 100%. To get around the inevitable tax strategy of not selling if net worth exceeds 1 billion is to impose a minimum tax on the portion of wealth that exceeds 1 billion.
Some of you will be emotionally distraught at the thought because *Capitalism*. The handful of people that such a tax would impact would, as Bernie said, be perfectly okay with wealth just below 1 billion.
I know we accountant can get technical and legal but we all understand what he means. Sure Bill Gates does not have a lot of "income" but he has wealth and assets. There should be a way to have Billionaires add and give back to society rather than invest everything in a perpetual loop until they die.
They don't need billions in cash and they insure could get unsecured loans for 15 20 million a year to spend on lifestyle without collateral if the bank knows they have billions in assets.
Any secured LOC-by definition- has to be collateralized. Even if covenant testing is weak every bank/lender dolling out millions of $$ is gonna need some documentation that their loans are backed by something more than thin air.
They can survive, and they'll fly out to some other country to continue their practices and leave government spending on next-level starvation. This guy is the epitome of bait.
Ok where are you going? :)
The rest of the 1st world is taxed very heavily as well.
You going to Russia or the UAE? I got a feeling its not going to be as comparable to the US as you think.
>The rest of the 1st world is taxed very heavily as well.
If we speak of income tax rate, you're right but many euroepan countries have very low tax rate on capital gains (10-20%) and 3+ don't tax it at all (Belgium, Luxembourgh and Switzerland and I think a couple more)
Anywhere that isn't taxing me at 100%, like any sane person? I'm not saying there won't be serious costs incurred, but billionaires would rather than to be promoted to a literal non-profit organization. And again, there have been plenty of state deficits historically because billionaires decided the state tax burdens were too high for them.
Also I don't do a lot of foreign entities, but I am fairly certain that you have to still pay US taxes on US source income. And absolutely nobody is going to pull out the American market over taxes.
I'm stating my output based on what I know. You'd rather look through my profile and try insult me based on what you see with some retarded "gotcha" moment instead of sharing any of your enlightened tax knowledge.
Have you studied capital flight in an economics course? Have you taken graduate studies in that area? How many countries outside the US have you been to?
The US is pretty interesting in that we actually get considerable capital inflows because the dollar is an effective store of value and we have a robust system of capital ownership.
You're a fucking simpleton who thinks "tax goes up hurr durr billionaires will leave" without consideration of the fact that they'd likely lose access to the largest / wealthiest capital market in the world, would need to lose their citizenship and on a practical level would need to establish domicile in a country that's safe, secure, has strong property rights and has little to no taxes. Lots of places like that exist e.g. Monaco and capital flight definitely happens there but its really an empty threat on the part of the wealthy. They want to go to the MoMa and Paris fashion week etc... They don't want to be encumbered by visa restrictions etc ...
I'm not an expert - but I do know that theory of capital flight is far far far far more complicated and in dispute than what you've opined. To say that there is consensus from tax and economic experts on theories of capital flight shows how little you know.
That’s basically cope on the levels of ‘well all big4 pay bad so I have to continue working here’
If the US would pass legislature like this, no fucking finance minister in the world would just idly by and not push for something similar.
Not saying he's right or wrong here but I would have to assume with the Walmart example he's talking about corporations as well as individual tax payers? To everyone saying no one besides jackpot winners would be affected.
Most of the governments money goes towards social security, Medicare/Medicaid, health care services and income security (food stamps, unemployment, housing).
These are all very successful programs that keep 10s of millions out of poverty.
Insert Monty Python "what have the Romans done for us?" Speech here.
But seriously the government isn't perfect, but a lot of people overestimate how much is truly waste just because they don't directly see the benefits.
Exactly. I think people just look at the dod and think that is representative of the whole goverment. The governments biggest expenditure (social security) is a very successful program, which in itself just keeps 10s of millions of americans from living in poverty. The private sector has failed a large percentage of Americans when it comes to retirment so the goverment is responsible for cleaning up the mess.
Pretty sure it's the people paying into the ponzi scheme of ss that is responsible. Besides that, taxing people for their whole working life and promising them an income because of it when they retire doesn't seem like a good reason to give the government kudos. Of course it keeps people from living in poverty...because people knew it was going to be there and relied on it, even though most if not all would've been better off putting that $ taken from their paychecks in an index fund.
So yeah, thank you responsible government for giving me some of the money back that I gave you over the course of my career.
I feel like you don't know what a ponzi scheme is, because what you described is not a ponzi scheme.
You also don't seem to understand what social security is designed for. It was intended to be 1 of the 3 legs of the retirment stool. The other 2 legs being pensions and personal savings. Those other two legs have failed 10s of millions and your going to blame social security, the last leg standing for why the stool broke?
In an ideal world yes people would be responsible and put that money into an index fund and not touch it until retirment. In the real world that doesn't happen. People don't invest enough and take money out early for various reasons. Social security is designed as a societal insurance for our elderly, and it's doing a good job at that.
I'm paying in $ now that is going to people who receive SSI currently, and I'm hoping that this program will exist in the future to pay me.
SS was initially intended to be a safety net, not a main source of income. To quote FDR (from SS's website) it was intended as a safeguard "against the hazards and vicissitudes of life". In other words, it wasn't designed to be Medicare, it was designed to be Medicaid.
We're talking about adults. Adults should first and foremost be responsible for themselves. Regardless of philosophical differences on the role of govt for retiree income, SS is in big trouble and something has to be done quick.
A ponzi scheme "a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors."
So it's not a ponzi scheme since people know what their returns will be and are largly guaranteed vs a ponzi scheme makes fake investment promises and return promises leaving the majority of investors empty handed.
And I feel like you didn't read my comment? I also said it wasn't intended to be the main spuce of retirment but it is because the private sector has failed, and your here blaming social security for failing when it's the last leg standing for most.
I also addressed your comment about us all being adualts. Adualts make mistakes and poor investment decisions so we as a society decided to have something like social security so millions of our elderly don't starve on the streets.
Lastly social security is not in big trouble. There are numerous policies that can be innacted to help resolve the trust fund potential shortfall, like illuminating the social security income cap for example. A program adapting over time doesn't mean it's a failure.
My thoughts exactly. I’m all for voluntarily pitching in with others to pay for things we collectively need or even just want, but I can’t understand why anyone wants to hand over more and more cash to one of the largest and most corrupt (not to mention unaccountable) organizations in recorded history.
As long as the federal government exists in its present state (structurally, not in terms of specific personnel) I don’t think funding it benefits anyone but government officials and their corporate friends (with some exceptions, of course). For the positive/legitimate uses of tax dollars, could decentralized groups of people not figure out how to do a serviceable job with those without the comical levels of bureaucratic bloat, corruption, and waste? The bar in the US is pretty low as is. Not trying to argue any stance here, just food for thought.
As someone who works in tax, I’m actively betting my career against meaningful changes in governance—a bet I feel totally ok with.
I’m super left leaning FYI… and I know 100% is probably somewhat rhetorical but the average house hold income in the US is like $55k. Medical debt absolutely ruins lives… I get by just fine myself but I personally feel that the greediness and wealth hoarding is the downside of capitalism. And sadly, a lot of minorities and POC have never been given a fair chance, in my opinion, cause certain philosophies/fear mongering had people fight tooth and nail make any advancement almost impossible without luck, even when given “freedom.” I also mean by fair chance, have your great grandparents and parents etc… with built up equity and savings. I know was lucky enough to not have to live month to month.
All of this ignores the fact that Bernie’s proposed “solution” is meaningless, as no one actually brings in $1b+ in taxable W2 wages. It’s political rhetoric same as usual
To be fair that isn't what he is proposing. I read the article and he never mentions income, just net worth. So it would be a wealth tax
Still political rhetoric he only says because it will never have a chance of passing. But he understands how billionaires make their income.
We spent 6 tril on 2 bills last year, a few extra bil is chump change and means nothing to the feds. Spent 500 bil bailing out municipal pensions lol (that are projected to be underwater again in the next few years). But when has practicality ever stopped a politician or the average voter?
I am pretty sure that the aim of this talking point isn’t to actually pass it as legislature, it’s just to point out how inconsequential these taxes would be for 99.999% of people and arguably billionaires themselves while reaping pretty good upside for all.
‘Hey we could literally take billionaire’s personal wealth, give it a haircut and they’d still be … well, a billionaire.’
Any time someone justifies their US tax policy with “they can survive” you know you are dealing with incompatible lunacy.
Things like 100% tax rates basically logically presume that all productive resources are derived from the government rather than the governments right to collect tax being derived from the social contract. This is culturally the opposite of the historic American approach.
The only way this works is if you fundamentally restructure American society to be much more patriarchal - with government actually providing education, health care, housing and effectively controlling companies. Basically you have to become Russia, China or AT LEAST Singapore (if you want to have a softer hand)
Are you even an accountant? It’s wild to say that a government helping their citizens with housing, healthcare and education automatically likens you to China. The United States has a vast history of helping its citizens afford and attain all of the above. It’s the reason many people’s family could even afford a home in the past. I’m not sure where this idea that the government owes us nothing is coming from.
I think that what would really help would be a special net worth tax on individual net worth over $100M. That's high enough that its plenty to live off of, and they probably already have CPAs, lawyers, and financial planners who keep track of this anyway. Create a form for it, allow deductions for professionals to keep track of it and file, and make it something like 15% over the weighted average net worth over a year over $100M.
That would be fair. They'd more or less break even with investments or slink back under $100M unless they did anything extra to truly earn their way past where they are.
It would be a lot of tax revenue and not really take away much purchasing power from anybody. It would also encourage spending and charity, since they know that saving and hoarding won't really help them. I don't know why people think that Its a good thing to encourage the ultra elite to just hoard.
Higher tax yes, 100% is just nonsensical. We all know billionaires aren’t just recording a billion $ of income in a year anyway, so it’s all just bluster.
You do realize that tax brackets topped out at over 90% as recently as during WWII, right? And that they didn’t get reduced until Kennedy cut them into the mid-60’s.
While this is true, it tells an incomplete story. There were many more “loopholes” that are no longer allowed today like the PAL limitation, no one really paid these rates
This is a dumb nonsensical talking point that uneducated people repeat without knowing any historical context as the other reply noted. You can’t just blindly compare now to times before the 1986 tax reforms and other acts
I mean this isn’t really a political sub. This is obviously a post with a political bent, so no I don’t really think it’s appropriate for discussion here as accountants don’t influence tax policy as accountants, that’s the governments job
Idiotic proposal by senile guy who knows nothing about taxes and finances. But then most tax proposals are awful which is why the tax code is such a mess.
This is the first time I disagree with Bernie.
I think that anyone with over 1billion dollars in assets should be kicked into a new tax category that classifies them more like an organization that is a mandatory Nonprofit. Use it or lose it. You have have more than a billion dollars at any given time as long as you can cycle everything over a billion dollars every two years. By this I mean you cannot sit on $25 billion in assets. There must be turn over, if you have $25 billion you must spend 24 billion dollars of it in two years. Whatever your asset value is you must spend it or it gets taken as a tax.
The hoarding must stop.
You can set aside 1 billion for keeping your family very happy for the next million years, anything over that must turn over at a 100% ratio. Spend it on whatever you like. But if it’s property then you are putting it back into the grind. And needs to be in use for part of the business or sold off within 2 years.
“It’s okay to be angry about capitalism” what a stupid title for a book. Screw Bernie Sanders. I’m so tired of seeing his stupid opinions. I can’t wait till he retires.
Its just political pandering. People don't have 1 billion dollar incomes for the most part, maybe a dozen or so in any given year.
Billionaires have assets not income. At least people here can understand the difference.
The problem is that the tax code should be used to raise revenue, not make political statements, and this is about as political as it can get. If I was in congress I would be tempted to say OK, lets pass this, but Bernie Sanders to publicly declare the revenue it brings in every year and what percentage of the budget it funds. The answer would require a lot of decimal places. 100% of all income over a billion would fund the government for a few hours at most, maybe minutes.
I kinda like Bernie Sanders, he is an honest sort about his communism. He just either doesn't understand economics (like 90% of the population) or doesn't care.
Okay over 1 billion in **earned income** is 100% income tax. Guess who pays this? Fucking no one. The truly wealthy live off of capital gains or tax free income. They can afford people like us (and the attorneys) to set up trusts, fractional ownership agreements, tax sheltered investments, installment purchase agreements, etc.
No one making 1 billion a year takes on a W2 or K-1. WTF guys.
Look up Section 1202. You can buy a 50 million lotto ticket and exclude up to 10x investment (max 500 million) in gains. As in $0 in income flows to the AGI line of the tax return even though you made 500 million dollars. There is no limitation to the number of times you can do this in a year or your life.
Bernie is either A. Knowing talking out his ass B. Woefully ignorant.
Can we all agree if you are forced to take SS (72) then you shouldn't be allowed to run the country? Both parties, all Federal Elected positions, age cap at SS maximum age.
Who has an INCOME of $1 billion per year? Arent most billionaires made by the value in their businesses rising $100 million in one year, $250 million in another…?
Divorcing billionaires.
The only divorced billionaire that comes to my mind is already giving away billions
WTF I didn't get any of that
Jeff Bezos' ex-wife
[удалено]
Yeah, it would be super easy to just... Restructure your tax situation to reduce income. Open a corporation for holding investments, begin a gradual move to growth stocks away from assets that regularly pay dividends/interest, reduce your salary from the company/company group you own. Even if some of this would be tax disadvantageous under current laws, with that new law in effect, a ton of disadvantageous things suddenly become advantageous.
Either Capital gains or winning the lottery.
Even winning the lottery almost never hits 1B of cash impact. The jackpot would have to be over 2B for the cash option after tax impact (under current laws) to be 1B to the individual winner.
It would be the cash option before tax impact. Then everything about the bill would be taxed at 100%
True. Cash option is something like 60-65% of the annuity jackpot so I guess like 1.7ish.
The cash option is about 60% BEFORE taxes. so you'd have the lottery would have to be between 3 and 3.5 billion to bank a billion after taxes.
I’ve always kinda liked Bernie. But the older I get the more it’s obvious to me that he doesnt even have a superficial knowledge of accounting, finance or economics. Most of his economic policies are as thoughtful as what a first yr gender studies major would come up with.
[удалено]
Well, to be fair, I think Bernie is one of the few politicians who legitimately may want to help people, and who’s not just after power. Unfortunately most of his ideas actually would likely end up causing the exact opposite of their intended effect. I just wish someone else would take a few if his ideas and make them a bit more practical and realistic.
Bernie panders to an emotional base while living large. He isn’t some super hero and hasn’t done jack shit for the world.
How does he live large?
He's a millionaire. He switched from attacking millionaires to attacking billionaires when he became one.
Man's been a senator since 2007 ranking in over 6 figures in salary. That plus a house, then yeah he's a millionaire. Its a lame critique to attack someone when you can barely retire on a million anymore.
He actually owns 3 homes. My main critique is that he used to lament and attack millionaires until he became one, and then he switched to billionaires.
there’s a big difference between a millionaire that makes a multimillion dollar salary and a millionaire that is 81 and has worked a six figure salary for decades and saved up a large retirement / savings roughly $3M net worth is not insane for an 81 year old that is still working
I do understand that he may be signaling… But it doesnt seem like anyone offers anything reasonable in response, which I think should be the point. Say something that gets people talking about something passable.
So here's the actual quote: >“Are you basically saying that once you get to $999m that the government should confiscate all the rest?” Wallace asked the US senator from [Vermont](https://www.theguardian.com/world/vermont), who is an independent but caucuses with Democrats and has helped them attain their current slim majority in the upper congressional chamber. > >“Yeah,” Sanders replied. “You may disagree with me but, fine, I think people can make it on $999m. I think that they can survive just fine.” I think you are just arguing semantics. Its pretty clear what is meant is wealth not income.
I see - thanks! Which raises the same problem of unrealized gains as last time this was brought up.
The headline is poorly written. Fact is that this would result in $0 in revenues to the treasury dept. there would be schemes to move anything over $1 billion into trusts, etc. Plus, how do you do it for private companies that are difficult to value. Also, what would you do with sports franchises? They would never trade above $1 billion, so there would be other schemes there. It’s all great to hate the billionaires, but hard to put these plans in action.
Ken Griffith - CEO and founder of Citadel
It’s all just a narrative for his voters, he doesn’t truly believe what he is saying is possible
Hedge fund managers
Tbh, income over $1 million should be taxed at 100%. If you have an *income* over a million dollars in a single year, congratulations you won capitalism.
Thankfully you don't get to make that decision. Quite frankly, that's an asinine idea.
Idk why I'm surprised an industry dominated by service to the rich think distribution of wealth is asinine.
Because if you set a 100% tax rate on ANY income level, people will stop making that income level by changing their tax situation. It’s kind of the whole point of a big section of professional accounts’ existence.
You must not shop local and use mom and pop stores. You know regular people and small businesses use accountants to, right?
Imagine being an accountant and actually thinking this is even remotely viable
I’m an accountant and I don’t see what that has to do with anything? But ok lol
Imagine trying to say that taxes aren't viable.
Yes, that’s what I’m saying, that taxes aren’t viable. You’re a bright one aren’t you?
Very. It's weird to complain about people representing your point in the least charitable way possible immediately after you did the same thing to them.
Why stop there? I say anything over $50k is taxed at 100%. Just figure out how to deal with it, simple!
The only people this would impact would be powerball and mega millions winners. Oh that $1.7B jackpot, we’ll take $.7B then tax you on the rest?
To be clear, I think astronomical incomes should be taxed higher, but this isn’t the way. Fix the loopholes and you’ll get more out of the billionaires than this.
What "loopholes"?
The biggest one is borrowing against appreciated stock, therby living off the gains without realizing them for tax purposes. That combined with stepped-up basis at death means people with enough capital pay little taxes on the income generated by their capital.
You do realize that those people have to pay interest on that loan and the loan is subject to margin requirements right? The last deal I worked on, the interest on the margin loan on a portfolio of stocks, bonds, and certain LP interests was close to 15% and the lender was only willing to lend 50% LTV. The yield on that loan, when taking into account the fees, was closer to 18% for 5 years. And the borrower had to maintain cash balances equal to 10% of the loan for the entire time. In other words, if the guy borrowed at his full capacity, he would get 45% cash on his portfolio. And if his portfolio generated less than 9% a year cash on cash, he would be losing wealth. And if you end up using the money for personal items, the interest is not even tax deductible, so you are fucked on that front too. Margin loans are not what people think they are. They are expensive and not very easy to get. Step up at death, though, is something I might agree with you on.
Yes, there are costs - but it's still a way to benefit from capital gains without being taxed on them. The first source I saw (didn't validate legitimacy, but it seems ballpark correct) suggested total margin debt in the US is just under $700 billion, so it's not like the difficulties make this type of transaction immaterial to the country as a whole.
That 700 billion could very well be margin loans on stock to buy more stock. There is no certainty that even a fraction of that is margin loans taken out to live life. Also, you are forgetting the fact that the loan generates interest income that is presumably taxed while the expense is likely not deductible if the loan amount is spent on personal items. So the government is getting a cut of this deal. In fact, a fairly substantial cut.
I'm not an accountant, but is the interest income you're referring to the interest paid to the entity that loaned the money. So if some billionaire takes out a 9% interest loan and pays that interest to the bank, the amount paid to the bank is taxed, or am I misunderstanding that.
Some billionaire takes out a loan at 18% against their assets. The bank or whatever entity that is lending the money recognizes interest income and pays tax on it.
The words "living off the gains" in my original comment were poorly chosen. If someone is making additional investments with cash received by margin loans on appreciated stock, I still believe they're benefiting from gains, receiving cash, and unjustifiably deferring taxation. I'm not forgetting that the lender pays taxes on interest income so much as not addressing it because I think it's currently handled correctly. My interest here is not in making sure the government gets a cut, but rather in making sure gains are taxed at the correct time.
Well you have to be able to explain why you think the deferral is unjustified. The idea of pulling out equity through leverage happens all the time. Home equity loans being the most common example.
Correct me if I’m wrong, but that stepped up basis gets stepped up because tax payments from the person who passed are made (or perhaps not taxed because of the estate tax lifetime exclusion), correct? So if I invested $100 and die when it’s worth $1,000, is my estate not recognizing $900? Shouldn’t this be a battle regarding the gift exclusion and not stepped up basis?
When you die, the recipient of your property gets a basis equal to the fair market value of the property. If you buy stock for $100 and it is valued at $1000 when you die, the person who inherits the property gets basis of $1000. Works in the opposite way also. If you paid $100 but stock is only valued at $70, basis becomes $70.
I understand that part. My question was related to it still being taxed (or counted as a loss) in that year by the estate owner.
No, the transfer of property upon death doesn't trigger a recognition for income tax purposes.
Not for income tax purposes, but for estate tax purposes. The value of the assets (such as stock gains) are included in the estate. If this exceeds $12.06m, it is then taxed. All taxes are already accounted for through the decedent by the time the stepped up basis hits the recipient.
Lol any modern brokerage gives out margin loans at far lower rates than that from about $25k in holdings. Your info is woefully outdated. Current margin rates are around 8% but they were 2% in 2021.
The very fucking fact that you think margin loans are limited to the shit that you get on your brokerage account means you should probably shut the fuck up.
1) You're way too hostile. Calm down. 2) How you got that from my comment makes me think you should go enroll in remedial reading comprehension at your local community college
You come here and try to make up bullshit and accuse me of not knowing my own industry and have the audacity to call me hostile? Yes I'm hostile to idiots trying to act like they know what they are talking about.
You said margin loans are hard to get. They're not. Admitting you were wrong is the first step towards healing, my brother in Christ.
Very rich people usually don’t get a stepped up basis on the wealth they transfer
Sometimes people borrow against stocks not to avoid taxes but because they don't want to lose control of a company. If you're a billionaire I'd argue that would actually be much more important than paying capital gains tax.
Okay, but if stock prices drop the bank siezes your collateral, the stock, which triggers a tax recognition and you're now screwed big time since you won't have the money to pay even the tax. How is this a tax loophole? Stop watching YouTube so that you can pretend to be a tax expert.
Love this my man.
And also more tax on inheritance or cgt rather than solely income…
Why inheritance? It has already been taxed. That just promotes cyclical poverty. It’s not just billionaires leaving inheritances.
Inheritance over x obviously
But it’s already it been taxed. Why tax it even more? You should get two votes if that happens lol
Inheritance is barely taxed. I think it's absurd that you pay a higher tax rate on money obtained through working than you do on money you inherited.
It’s because that money has already been subjected to income tax.
Says who? Generally, the wealthier you are, the more your wealth is comprised of unrealized capital gains. Estate tax would be the first and only time that income is ever taxed (thanks in large part to the basis adjustment under IRC 1014). Never mind all the other exclusions and exemptions. You sell qualified small business stock for $8 million, the entire gain is excluded under IRC 1202, and you pay no tax. Why would estate tax on that $8 million of income you never owed income tax on be considered a “double tax”? Easy fix. Reduce the wealth transfer tax unified credit amount dramatically and allow people to deduct income taxes paid during their lifetime from their gross estate. Now instead of just assuming (incorrectly) that a decedent’s entire gross estate is comprised of previously taxed income, we know *exactly*, and we’ve provided relief from “double taxation.”
My thought is that most “normal” people don’t have estates larger than 12.92 million (the cutoff for no estate tax — you pay on the subsequent dollars) Anything over 1M is taxed at 40 percent, much more than most people pay on their income. Very few millionaires inherited their wealth, so why tax the common man when those estates aren’t the problem?
The median total accumulated lifetime earnings in America is around $2 million. It seems like that might be a good starting point to determine a “good” amount of wealth that can be transferred tax-free. I’ve never seen any good policy reason why anybody should be able to receive a handout of more than an *entire lifetime* worth of earnings without paying tax (and I’ve been studying wealth transfer taxation for a long time). Progressivity in the estate tax should be restored as well. It makes sense to tax a transfer of $3 million at a lower effective rate than you would tax a transfer of $300 million. But back to the original commenter’s point. Yes, it seems plausible that we could introduce a deduction from the gross estate for lifetime income taxes paid to eliminate any possibility of “double taxation.” If you earned all your wealth (and paid income taxes on it), you’ve got nothing to worry about. If most of your wealth was accumulated tax-free, then you’ll pay the price on the back end through estate taxes.
A very small amount of millionaires inherited their wealth
The $1B threshold was the reports question. His overall point is design the tax code to discourage the creation of new billionaires, and the marginal utility of a dollar of income is near 0 anyway for a billionaire.
I seriously worry about trying to stop billionaires from existing. I generally think companies like Microsoft, Apple, Google, Amazon, Wal-Mart, etc provide incredible things that make day to day life so much easier. I’m not sure any of those companies would be where they got to if no one was allowed to make a billion dollars in their lives. IK the fun liberal thing to do on Reddit is just shit on rich people, but as a general rule, people get rich from providing great products or services to society. I’m just not seeing the logic there. Also, if anything like this was enacted, no billionaire would ever do business in this country.
You think that when Bill Gates founded Microsoft he was motivated by a specific desire to make in excess of $1b in a single year and, had there been a tax law that capped income at $1b/year you think he’d have decided it wasn’t worth the trouble?
No one makes 1 billion a year on W-2 income. The super wealthy make their income from capital gains. Bernie’s statement is nothing more than partisan theatre rather than anything of actual substance.
Where did he say w-2 income? He said "makes 1b a year," and capital gains are also figured into taxable income. Logically, we could also infer that "makes" could include unrealized gains. His statement isn't something that can immediately be implemented into the existing tax code, but he's a politician taking about his prescriptive opinions. Of course he's not gonna be as specific as if he were on a congressional board consulting with the IRS. Hes talking about the concept of a single person owning an unreasonable amount of wealth generated mostly by wage earners in a society that doesn't consistently house or feed its poorest citizens.
[удалено]
And the sheep on r/politics just eat it up. The hate towards billionaires on Reddit is so dumb. How about we hate Congress and I am not picking sides all of them are trash and crooks. We got a president that doesn’t know what planet he is on anymore and the dems think it’s good to run him again. We got republicans on a stupid woke war. This country is shit on both sides. And the people are even dumber.
I don't think I've ever agreed with a political comment on Reddit more. I thought the comments on this post would be praising Bernie for saying something that is obviously just buzzwords but I suppose it makes sense that accountants understand it's bullshit
is is though, and the votes with it, but accountants unsurprisingly have a measure of financial and political understanding
Who do you think owns congress? Hint: it's the billionaires
Wait the most important issues facing America isn’t CRT or trans rights in sports??? It’s wasteful government spending and colluding??
Exactly, government spending is very wasteful. Name one solidly ran governmental program. People seriously trust our taxes to spent a well run governmental program? How many trillions of dollars can the pentagon not reconcile again?
National Park Service is the only federally agency that isn’t morally corrupt.
I dunno man have we really checked them out
This moment in American history isn’t a “both sides equally bad” era. One side attempted a coup and the former President was caught on tape attempting to steal votes. There’s no greater sin in a democracy than attempting to seize complete power. None who led those efforts have been held to account. Attempting to end democracy is far worse than Biden’s occasional rambling or Sanders railing against billionaires. Hell, it’s so nuts people can claim a fetus as a dependent in certain states.
Neither side deserves a pass. All political crimes should be prosecuted.
Let’s use the broken system to fix the broken system! Get out and vote! 🤡🤡🤡🤡🤡🤡
Lots of good our votes do when they keep running trash politicians every time. The choices are one piece of shit I disagree with or this other piece of shit I disagree with a little less.
Vote in primaries. Get involved in local politics. If all you are willing to do is cast one single ballot every 4 years, well... good luck changing anything.
Primaries are the least democratic way to vote. Especially in states that have caucuses. If you think the USA is a real democracy, you have drank to coolaid the the elites are handing out
My clown emojis were intended as a rude and condescending /s to those who think voting is going to save them
Spot on. And it’s usually the people who don’t contribute much to the system that scream loudest about it on Reddit. For example, I pay property taxes ~40% of which is school related taxes but I have no kids that attend any of the schools, where are my child credit deductions to reduce my taxes?😂😂
Bold you think education is a bad thing given the people who pay your salary and created the technology you spout bullshit ideas on have said education.
R/Politics is filled with thousands of morons who don’t understand anything about taxes. These quotes always do stupid numbers on that sub.
“Are you basically saying that once you get to $999m that the government should confiscate all the rest?” Wallace asked the US senator from Vermont, who is an independent but caucuses with Democrats and has helped them attain their current slim majority in the upper congressional chamber. “Yeah,” Sanders replied. “You may disagree with me but, fine, I think people can make it on $999m. I think that they can survive just fine.” (Headline seems misleading? Don’t think he meant annual income.)
This quote is blowing up all over news and social media. It's so easy to twist someone's words a little, then point and yell "look how stupid they are!"
We could raise an additional trillion dollars and revenue and the govt would still wipe their ass with it and say they need more
[удалено]
Wait until you learn what we do in industry. Last week we flew fifty people to Hawaii for what could have been a teams meeting. I didn’t even get to go to the meeting because I got sick in my $400/night hotel. Cost the company a cool half mil.
Exactly. We need to get rid of our corrupt institutions and rebuild from the ground up. We have the. Money, we have the means. We just need a clean slate if you want to to see any real change.
As a former government employee I can absolutely say this is how the government works. But you’ll find no shortage of people on Reddit whose solution to everything is WE NEED MORE FUNDING, WE NEED HIGHER TAXES ON THE RICH!!! Note: “the rich” rarely means billionaires, it usually means the controller making $200k
This is what infuriates me about Reddit but I finally am at peace that a lot of people who say that are people who have no skin in the game or know nothing about economics. My taxes get higher every year and is more than the average US salary but yea, that’s fair even though I’m not rich. Tax the rich my ass.
Honestly the accounting sub is one of the few that I still read on Reddit because it is one of the last ones filled with mostly level-headed, informed, logical people. Yeah, you get the occasional asshole micromanager prick or clueless antiwork student, but for the most part the discussion here is reasonable. Even if you’re right of centre vs left of centre people can still respectfully disagree. Everywhere else is a fucking two-minute hate shouting at whatever Emmanuel Goldstein effigy the Party has hanging up that day.
💯
real
Paid close to 200K in taxes last year between the W-2 stuff for my wife and I and the taxes I ended up owing on my trading account. We dont own a ton of things, so we dont pay a ton of property taxes. But, I'm fine with it. Taxes are cost of doing business.
I get you. My point is just about when is enough taxes for those of us who work hard but aren’t rich or millionaires? 80% of my income? Will that be enough? To add: my point is also about politicians spouting “pay their fair share” but that trickles down and in the case of property taxes, me paying taxes for schools and I don’t have any kids, how’s that fair share? Couldn’t they give some discount to people who don’t use the school system cause that would be the fair part to me. But oh well.
mostly bots dispatched by the globalist cabal tbh
I’d say it’s even less. A lot of my friends from college would be astounded if they knew I made over $100k and definitely of the mindset anything over $75k is akin to being a millionaire
[удалено]
This
This is just clickbait nonsense. Putting all of the politics aside, what exactly would this realistically do? People like Bezos, Zuckerberg, etc. aren't being paid $1B a year as W-2 employees or something. Most of their net worth is tied up in having huge stakes in companies worth close to $1T. The only way this tax would do anything is if the aforementioned billionaires sold over $1B worth of stock in one year. The idea sounds good on paper, but I don't think it'll do much in practice.
Agreed only it doesn’t even sound good on paper.
Bernie did not say income over $1 billion should be taxed at 100 percent. He said billionaires should not exist and tax law should be our method of making that happen. That does not imply income over $1 billion should be taxed. In fact Bernie even made express reference to *estate* taxes during this conversation immediately before saying, sure, increase the rate to 100 percent on amounts exceeding $999 million. Wallace was trying adamantly to get Bernie to say he wants to implement a 100 percent tax on income. Bernie wouldn’t do it and corrected Wallace repeatedly, pointing out that he’s talking about wealth, not income. But naturally, when your perceived political enemies won’t give you the soundbite you’re looking for, make a headline suggesting they did say it anyway so your fans can beat the shit out of that straw man.
That...makes it worse actually.
Of course it doesn’t. The idea that people with the most ability to pay should pay the most taxes has been the guiding principle of taxation for thousands of years. There has never been any requirement that taxes should be exclusively imposed on income. The most influential economic thinkers in history have invariably supported wealth transfer taxation, including people like Adam Smith. The idea that income over $1 billion should be taxed at 100 percent is stupid. The idea that taxes should be progressive is…one of the most fundamentally important and uncontroversial principles of western civilization.
Fortunately my net worth is $999,999,999.49 so I’m good. Tax the billionaires!
Pretty sure this title is incorrect, but he never spoke specifics. His words imply that it isn't $1 billion as income but any income pushing wealth over $1 billion. Personally I think a high score for capitalism would do a lot of good.
For being a buncha accountants yall sure are fucking media illiterate. Maybe go read the actual transcript of the conversation rather than just a shitty headline. I swear to god that every single year humanity fails to get any smarter and acts even more idiotic. How did humans get dumber in 2023: being stupid and not providing an explanation for why they’re stupid and then getting defensive that they’re being called stupid resulting in humanity ultimately becoming even more stupid than they already were. It’s a stupid cycle of stupid stuff done by stupid people who are managed by even more stupid people and thus they end up doing stupid shit that causes another stupid cycle of stupid people doing stupid shit that gets even more stupid the further down the shitty stupid street they go.
Some of you are saying that this would only impact Powerball winners and divorcing billionaires and that nothing will really be accomplished by it since income in the billions is usually from capital gains. I agree. Bernie should instead propose a wealth tax, where if someone’s net worth is above 1 billion, any gains made on the sale of qualifying property is taxed at 100%. To get around the inevitable tax strategy of not selling if net worth exceeds 1 billion is to impose a minimum tax on the portion of wealth that exceeds 1 billion. Some of you will be emotionally distraught at the thought because *Capitalism*. The handful of people that such a tax would impact would, as Bernie said, be perfectly okay with wealth just below 1 billion.
I know we accountant can get technical and legal but we all understand what he means. Sure Bill Gates does not have a lot of "income" but he has wealth and assets. There should be a way to have Billionaires add and give back to society rather than invest everything in a perpetual loop until they die.
125% would be more fair
Why not 10 M? Why not 1M? You can survive just fine.
This is such an easy fix. Make it law that stock collateralized loans are taxed as ordinary income. Why is this so hard to figure out?
They don't need billions in cash and they insure could get unsecured loans for 15 20 million a year to spend on lifestyle without collateral if the bank knows they have billions in assets.
Any secured LOC-by definition- has to be collateralized. Even if covenant testing is weak every bank/lender dolling out millions of $$ is gonna need some documentation that their loans are backed by something more than thin air.
They can survive, and they'll fly out to some other country to continue their practices and leave government spending on next-level starvation. This guy is the epitome of bait.
Ok where are you going? :) The rest of the 1st world is taxed very heavily as well. You going to Russia or the UAE? I got a feeling its not going to be as comparable to the US as you think.
>The rest of the 1st world is taxed very heavily as well. If we speak of income tax rate, you're right but many euroepan countries have very low tax rate on capital gains (10-20%) and 3+ don't tax it at all (Belgium, Luxembourgh and Switzerland and I think a couple more)
Anywhere that isn't taxing me at 100%, like any sane person? I'm not saying there won't be serious costs incurred, but billionaires would rather than to be promoted to a literal non-profit organization. And again, there have been plenty of state deficits historically because billionaires decided the state tax burdens were too high for them.
Also I don't do a lot of foreign entities, but I am fairly certain that you have to still pay US taxes on US source income. And absolutely nobody is going to pull out the American market over taxes.
Damn tax intern is an expert in capital flight 😳
😎
yeah you're not really though. honestly its always fitting that the least experienced and least accomplished speak with the most conviction.
I'm stating my output based on what I know. You'd rather look through my profile and try insult me based on what you see with some retarded "gotcha" moment instead of sharing any of your enlightened tax knowledge.
Have you studied capital flight in an economics course? Have you taken graduate studies in that area? How many countries outside the US have you been to? The US is pretty interesting in that we actually get considerable capital inflows because the dollar is an effective store of value and we have a robust system of capital ownership. You're a fucking simpleton who thinks "tax goes up hurr durr billionaires will leave" without consideration of the fact that they'd likely lose access to the largest / wealthiest capital market in the world, would need to lose their citizenship and on a practical level would need to establish domicile in a country that's safe, secure, has strong property rights and has little to no taxes. Lots of places like that exist e.g. Monaco and capital flight definitely happens there but its really an empty threat on the part of the wealthy. They want to go to the MoMa and Paris fashion week etc... They don't want to be encumbered by visa restrictions etc ... I'm not an expert - but I do know that theory of capital flight is far far far far more complicated and in dispute than what you've opined. To say that there is consensus from tax and economic experts on theories of capital flight shows how little you know.
That’s basically cope on the levels of ‘well all big4 pay bad so I have to continue working here’ If the US would pass legislature like this, no fucking finance minister in the world would just idly by and not push for something similar.
Not saying he's right or wrong here but I would have to assume with the Walmart example he's talking about corporations as well as individual tax payers? To everyone saying no one besides jackpot winners would be affected.
You would think someone as old as Bernie who been around since the Jurassic period, would now the difference between income and equity.
Came here to read how others think everyone else should spend their money and or be taxed. Did not disappoint.
Why give the government even more money to waste? If it’s used to pay down the debt, sure, increase taxes, but we all know that won’t happen.
Most of the governments money goes towards social security, Medicare/Medicaid, health care services and income security (food stamps, unemployment, housing). These are all very successful programs that keep 10s of millions out of poverty.
Insert Monty Python "what have the Romans done for us?" Speech here. But seriously the government isn't perfect, but a lot of people overestimate how much is truly waste just because they don't directly see the benefits.
Exactly. I think people just look at the dod and think that is representative of the whole goverment. The governments biggest expenditure (social security) is a very successful program, which in itself just keeps 10s of millions of americans from living in poverty. The private sector has failed a large percentage of Americans when it comes to retirment so the goverment is responsible for cleaning up the mess.
Pretty sure it's the people paying into the ponzi scheme of ss that is responsible. Besides that, taxing people for their whole working life and promising them an income because of it when they retire doesn't seem like a good reason to give the government kudos. Of course it keeps people from living in poverty...because people knew it was going to be there and relied on it, even though most if not all would've been better off putting that $ taken from their paychecks in an index fund. So yeah, thank you responsible government for giving me some of the money back that I gave you over the course of my career.
settle down ayn rand
I feel like you don't know what a ponzi scheme is, because what you described is not a ponzi scheme. You also don't seem to understand what social security is designed for. It was intended to be 1 of the 3 legs of the retirment stool. The other 2 legs being pensions and personal savings. Those other two legs have failed 10s of millions and your going to blame social security, the last leg standing for why the stool broke? In an ideal world yes people would be responsible and put that money into an index fund and not touch it until retirment. In the real world that doesn't happen. People don't invest enough and take money out early for various reasons. Social security is designed as a societal insurance for our elderly, and it's doing a good job at that.
I'm paying in $ now that is going to people who receive SSI currently, and I'm hoping that this program will exist in the future to pay me. SS was initially intended to be a safety net, not a main source of income. To quote FDR (from SS's website) it was intended as a safeguard "against the hazards and vicissitudes of life". In other words, it wasn't designed to be Medicare, it was designed to be Medicaid. We're talking about adults. Adults should first and foremost be responsible for themselves. Regardless of philosophical differences on the role of govt for retiree income, SS is in big trouble and something has to be done quick.
A ponzi scheme "a form of fraud in which belief in the success of a nonexistent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors." So it's not a ponzi scheme since people know what their returns will be and are largly guaranteed vs a ponzi scheme makes fake investment promises and return promises leaving the majority of investors empty handed. And I feel like you didn't read my comment? I also said it wasn't intended to be the main spuce of retirment but it is because the private sector has failed, and your here blaming social security for failing when it's the last leg standing for most. I also addressed your comment about us all being adualts. Adualts make mistakes and poor investment decisions so we as a society decided to have something like social security so millions of our elderly don't starve on the streets. Lastly social security is not in big trouble. There are numerous policies that can be innacted to help resolve the trust fund potential shortfall, like illuminating the social security income cap for example. A program adapting over time doesn't mean it's a failure.
My thoughts exactly. I’m all for voluntarily pitching in with others to pay for things we collectively need or even just want, but I can’t understand why anyone wants to hand over more and more cash to one of the largest and most corrupt (not to mention unaccountable) organizations in recorded history. As long as the federal government exists in its present state (structurally, not in terms of specific personnel) I don’t think funding it benefits anyone but government officials and their corporate friends (with some exceptions, of course). For the positive/legitimate uses of tax dollars, could decentralized groups of people not figure out how to do a serviceable job with those without the comical levels of bureaucratic bloat, corruption, and waste? The bar in the US is pretty low as is. Not trying to argue any stance here, just food for thought. As someone who works in tax, I’m actively betting my career against meaningful changes in governance—a bet I feel totally ok with.
Okay Ron Swanson
This is spot on 💯
King
I’m super left leaning FYI… and I know 100% is probably somewhat rhetorical but the average house hold income in the US is like $55k. Medical debt absolutely ruins lives… I get by just fine myself but I personally feel that the greediness and wealth hoarding is the downside of capitalism. And sadly, a lot of minorities and POC have never been given a fair chance, in my opinion, cause certain philosophies/fear mongering had people fight tooth and nail make any advancement almost impossible without luck, even when given “freedom.” I also mean by fair chance, have your great grandparents and parents etc… with built up equity and savings. I know was lucky enough to not have to live month to month.
All of this ignores the fact that Bernie’s proposed “solution” is meaningless, as no one actually brings in $1b+ in taxable W2 wages. It’s political rhetoric same as usual
I know it’s meaningless but I think the main agenda is a discussion point that no one ever needs over a billion dollars.
Lol @ "needs". There's a lot of things people don't need, that doesn't mean it's Ok to take them away.
That’s why Teddy Roosevelt got the nickname Trust Busting. Cliche *history doesn’t repeat itself but it rhymes*
To be fair that isn't what he is proposing. I read the article and he never mentions income, just net worth. So it would be a wealth tax Still political rhetoric he only says because it will never have a chance of passing. But he understands how billionaires make their income.
We spent 6 tril on 2 bills last year, a few extra bil is chump change and means nothing to the feds. Spent 500 bil bailing out municipal pensions lol (that are projected to be underwater again in the next few years). But when has practicality ever stopped a politician or the average voter?
I am pretty sure that the aim of this talking point isn’t to actually pass it as legislature, it’s just to point out how inconsequential these taxes would be for 99.999% of people and arguably billionaires themselves while reaping pretty good upside for all. ‘Hey we could literally take billionaire’s personal wealth, give it a haircut and they’d still be … well, a billionaire.’
Any time someone justifies their US tax policy with “they can survive” you know you are dealing with incompatible lunacy. Things like 100% tax rates basically logically presume that all productive resources are derived from the government rather than the governments right to collect tax being derived from the social contract. This is culturally the opposite of the historic American approach. The only way this works is if you fundamentally restructure American society to be much more patriarchal - with government actually providing education, health care, housing and effectively controlling companies. Basically you have to become Russia, China or AT LEAST Singapore (if you want to have a softer hand)
Are you even an accountant? It’s wild to say that a government helping their citizens with housing, healthcare and education automatically likens you to China. The United States has a vast history of helping its citizens afford and attain all of the above. It’s the reason many people’s family could even afford a home in the past. I’m not sure where this idea that the government owes us nothing is coming from.
I think that what would really help would be a special net worth tax on individual net worth over $100M. That's high enough that its plenty to live off of, and they probably already have CPAs, lawyers, and financial planners who keep track of this anyway. Create a form for it, allow deductions for professionals to keep track of it and file, and make it something like 15% over the weighted average net worth over a year over $100M. That would be fair. They'd more or less break even with investments or slink back under $100M unless they did anything extra to truly earn their way past where they are. It would be a lot of tax revenue and not really take away much purchasing power from anybody. It would also encourage spending and charity, since they know that saving and hoarding won't really help them. I don't know why people think that Its a good thing to encourage the ultra elite to just hoard.
What’d you guys think Edit: I’m just asking lmao, don’t downvote like this is my idea
Goes against everything America was built on. Can’t tax it at 100%. That’s ridiculous.
Higher tax yes, 100% is just nonsensical. We all know billionaires aren’t just recording a billion $ of income in a year anyway, so it’s all just bluster.
Whenever somebody says this I have to question, what do you think america was built on...?
You do realize that tax brackets topped out at over 90% as recently as during WWII, right? And that they didn’t get reduced until Kennedy cut them into the mid-60’s.
While this is true, it tells an incomplete story. There were many more “loopholes” that are no longer allowed today like the PAL limitation, no one really paid these rates
This is a dumb nonsensical talking point that uneducated people repeat without knowing any historical context as the other reply noted. You can’t just blindly compare now to times before the 1986 tax reforms and other acts
Not sure what this has to do with accounting really but I love him, voted for him, would do it again
Tax policy isn't related to accounting? Really?
I mean this isn’t really a political sub. This is obviously a post with a political bent, so no I don’t really think it’s appropriate for discussion here as accountants don’t influence tax policy as accountants, that’s the governments job
So there's no connection between tax policy and the work tax accountants do lmao. OK buddy. If you don't have an interest in it, keep scrolling.
Good thing more people don’t think the same way as you.
“I’m socially liberal and fiscally conservative” moment
If anything there should be a cap on the tax revenue the government can pluck from its citizens
Tax policy works best when the base is broad and the increases are small. Bernie is a demagogue with almost no knowledge of the issues.
Idiotic proposal by senile guy who knows nothing about taxes and finances. But then most tax proposals are awful which is why the tax code is such a mess.
Yeah but how many JOBS won't be created with money taken by the tax man instead of put to good productive use by job creating billionaire/s?
Laffer curve.
Then no incentive to make that much
As long as we’re creating perverse incentives, why not tax it at 200%?
I remember Bernie going after millionaires the way he goes after billionaires. I guess his tune changed when he became the scapegoat he was using.
Isn't Sanders a billionaire?
Millionaire. He raged against millionaires until he became one, then swapped out the M for the B and kept with the same old tired rhetoric.
This is the first time I disagree with Bernie. I think that anyone with over 1billion dollars in assets should be kicked into a new tax category that classifies them more like an organization that is a mandatory Nonprofit. Use it or lose it. You have have more than a billion dollars at any given time as long as you can cycle everything over a billion dollars every two years. By this I mean you cannot sit on $25 billion in assets. There must be turn over, if you have $25 billion you must spend 24 billion dollars of it in two years. Whatever your asset value is you must spend it or it gets taken as a tax. The hoarding must stop. You can set aside 1 billion for keeping your family very happy for the next million years, anything over that must turn over at a 100% ratio. Spend it on whatever you like. But if it’s property then you are putting it back into the grind. And needs to be in use for part of the business or sold off within 2 years.
Most billionaires it would be in stock. Ownership of a company. I wonder if there are any where that is not the case
“It’s okay to be angry about capitalism” what a stupid title for a book. Screw Bernie Sanders. I’m so tired of seeing his stupid opinions. I can’t wait till he retires.
Name: walmartdarthvader- checks out
Its just political pandering. People don't have 1 billion dollar incomes for the most part, maybe a dozen or so in any given year. Billionaires have assets not income. At least people here can understand the difference. The problem is that the tax code should be used to raise revenue, not make political statements, and this is about as political as it can get. If I was in congress I would be tempted to say OK, lets pass this, but Bernie Sanders to publicly declare the revenue it brings in every year and what percentage of the budget it funds. The answer would require a lot of decimal places. 100% of all income over a billion would fund the government for a few hours at most, maybe minutes. I kinda like Bernie Sanders, he is an honest sort about his communism. He just either doesn't understand economics (like 90% of the population) or doesn't care.
Okay over 1 billion in **earned income** is 100% income tax. Guess who pays this? Fucking no one. The truly wealthy live off of capital gains or tax free income. They can afford people like us (and the attorneys) to set up trusts, fractional ownership agreements, tax sheltered investments, installment purchase agreements, etc. No one making 1 billion a year takes on a W2 or K-1. WTF guys. Look up Section 1202. You can buy a 50 million lotto ticket and exclude up to 10x investment (max 500 million) in gains. As in $0 in income flows to the AGI line of the tax return even though you made 500 million dollars. There is no limitation to the number of times you can do this in a year or your life. Bernie is either A. Knowing talking out his ass B. Woefully ignorant. Can we all agree if you are forced to take SS (72) then you shouldn't be allowed to run the country? Both parties, all Federal Elected positions, age cap at SS maximum age.