|Evolution of Tax Reform into Billionaire Tax Relief||2017-12-28||76||2||1||4||tax|
|Need a Last Minute Charitable Deduction?||2017-12-28||29||-||4||tax|
|Getting to 60 on Tax Reform||2017-12-04||9||1||1||3||1||tax|
|What happens next on the Republican tax bill?||2017-12-01||9||-||2||tax|
|Taxation of Principal Residences||2017-12-01||4||-||tax|
|If the Republican tax bill gets signed into law, express||2017-11-29||12||2||1||2||tax|
|Craft Beer and Taxes - an object lesson||2017-11-27||23||1||1||1||1||tax|
|Reasons to dislike the one-flat-tax framework||2017-11-27||5||-||tax|
|Bypassing progressive income tax by unrecaptured section||2017-11-27||8||-||2||tax|
|Double Taxation of Dividends||2017-11-20||7||-||1||1||tax|
|How do you tax Discretionary Income?||2017-11-20||6||-||tax|
|Which California Representatives voted against the||2017-11-17||6||-||1||tax|
The table above has these entries. Post entries with just one line for Reach were not boosted. Boosted posts have two lines for Reach and several other items. The upper line reflects all interactions, the bottom line just those resulting from paid ads.
For the emoticon table only, Love Haha Wow Sad Angry are listed separately.
========== Evolution of Tax Reform into Billionaire Tax Relief What Trump campaigned on: https://www.washingtonpost.com/opinions/the-original-trump-campaign-tax-plan-is-the-right-one/2017/11/15/a612a302-c97b-11e7-8321-481fd63f174d_story.html Deductions and credits were limited to $150,000, so taxes on the wealthy went up, to pay for working and middle-class tax reductions in a revenue-neutral way. What Trump proposed in April - the first two are the critical points: https://www.vox.com/2017/4/26/15438404/trump-tax-plan-april-mnuchin-cohn-changes 1) Corporate tax rate 15% - there are actually some good reasons for lowering the corporate tax rate, but not that much. 2) Flow-through tax rate 15% - so business owners like Trump only pay 15% instead of the maximum personal tax bracket 39.6%. 3) Eliminate alternative minimum tax - so business owners like Trump don't have to worry about the maximum AMT personal tax rate of 28%. 4) Eliminate estate tax - so wealthy individuals like Trump can leave all their accumulated fortunes to their heirs. 5) Window dressing - small cuts to deceive the masses into thinking it's all about them, despite that almost all W-2 wage earners get nothing from the four points listed above. What the Republicans proposed in September - https://www.washingtonpost.com/news/wonk/wp/2017/09/27/the-gop-tax-plan-explained-in-simplest-possible-terms/ 1) Corporate tax rate 20% - instead of Trump's 15% 2) Flow-through tax rate 25% - instead of Trump's 15% 3) Eliminate alternative minimum tax - 4) Eliminate estate tax - 5) Window dressing - slightly different from Trump's window dressing, but still almost all W-2 wage earners get nothing from the four points listed above. What Trump signed in December: http://www.foxnews.com/politics/2017/12/22/congress-votes-on-tax-bill-what-tax-cuts-and-jobs-act-means-for.amp.html 1) Corporate tax rate 21% - instead of 20% 2) Flow-through tax rate reduced - the details are impenetrable: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3089423 but the motivation is obvious: http://www.ibtimes.com/political-capital/republican-senators-will-save-millions-special-real-estate-tax-break-2630037 3a) Eliminate corporate alternative minimum tax - 3b) Reduce personal alternative minimum tax - higher zero brackets mean fewer people subject to it, but reducing the highest tax bracket on regular tax means more people subject to it 4) Reduce estate tax - the zero brackets are doubled 5) Window dressing - slightly different from previous window dressing, but still almost all W-2 wage earners get nothing from the four points listed above. 6) Repeals individual mandate of Obamacare - as young healthy people drop out, tax subsidies will decline, but insurance rates will increase, so tax subsidies will increase 7) Opens Arctic National Wildlife Refuge to oil drilling - that's certainly germane to tax reform! Items 1-4) were modified from the September plan in order to get through the Senate under reconciliation (50 votes) instead of regular order (60 votes). Interestingly, Trump signed the bill in 2017 instead of waiting a couple of weeks until 2018, which had been the plan of the Congressional leadership, in order to avoid triggering PAYGO Medicare cuts until after the 2018 election. http://www.businessinsider.com/when-will-trump-sign-tax-reform-bill-paygo-medicare-2017-12 Now there is going to be an interesting and quite likely stalemated negotiation involving liberal Democrats in the Senate and Freedom Caucus in the House. If it goes badly, Trump will blame the Congressional leadership. The Trump Philosophy: SAYING: What does my shrinking base want to hear? DOING: What's good for billionaires like me? At least he's consistent! ===== impact 349 impactrate 0 likeimpress 2 negative 0 posted 2017-12-28 ratio 10 react 7 reactrate 0 shares 1 sharesrate 0 sumclicks 4 title Evolution of Tax Reform into Billionaire Tax Relief topic tax wordrate 0 words 498 ID 556413984703125 URL https://www.facebook.com/politicalscrapbooknet/posts/556413984703125 audclicks 4 audreach 3 engaged 4 impress 114 likeclickusers 2 likeimpress 2 likeuimpress 39 likeusers 2 likeuusers 18 matchedlinkclicks 1 matchedotherclicks 3 oimpress 114 oreach 76 posted "12/28/2017 02:59:21 PM" postlinkclicks 1 postotherclicks 3 reach 76 sharesimpress 1 sharesusers 1 type Status ========== Need a Last Minute Charitable Deduction? Most political contributions are not tax deductible. But several organizations have tax-deductible educational affiliates that you might consider supporting before the end of 2017. http://www.fairvote.org/ FairVote retire winner-take-all Congressional representation in favor of multi-district preferential balloting http://www.democracy21.org/ Democracy 21 Education Fund retire "one-dollar-one-vote" by legislation and judicial action https://bipartisanpolicy.org/ Bipartisan Policy Center actively seeking bipartisan solutions to problems https://www.concordcoalition.org/ Concord Coalition for control of Federal deficit https://itep.org/ Institute on Taxation and Economic Policy ensure that policy makers, media, and advocates know the impact that tax changes have on people of different income levels http://www.equalrightsnow.org/ We the People Project voting rights for residents of Federal territories ===== impact 33 impactrate 0 negative 0 posted 2017-12-28 ratio 7 react 4 reactrate 0 sharesrate 0 sumclicks 4 title Need a Last Minute Charitable Deduction? topic tax wordrate 0 words 83 ID 556367304707793 URL https://www.facebook.com/politicalscrapbooknet/posts/556367304707793 audclicks 4 audreach 3 engaged 3 impress 53 likeclickusers 3 likeuimpress 52 likeuusers 28 matchedotherclicks 4 oimpress 53 oreach 29 posted "12/28/2017 12:18:19 PM" postotherclicks 3 reach 29 type Status ========== Discretionary Income What is discretionary income? It's a concept of economics - the amount of wealth that you have that you can spend as you choose - thus excluding the cost of staying alive and the cost of producing income (e.g. the cost of driving to work). It's the part of your income that rewards you for your labor. In principle, a fair taxation system might take a fixed percentage of all your discretionary income, regardless of source. People who are barely getting by have no discretionary income and shouldn't be taxed. Since we have evolved beyond letting the poor and sick and disabled die in the streets, we accept that there are some people who will be subsidized by others, and we have assigned the bulk of this task to government, to be paid by taxes. For businesses, it's easy to equate discretionary income to gross receipts less the ordinary and necessary business expenses required to produce the gross receipts. The net profit is the discretionary income to be taxed. For individuals, it's not so easy, which is why discretionary income is not mentioned in any tax return instructions. Instead there are adjustments and deductions and exemptions and credits - different for the Federal government and for each state - some of which are intended to remove the non-discretionary income from the amount you pay tax on. But many of these are so complicated and obscure that most ordinary W-2 wage earners have no idea what they are about, and rightly conclude that the system is rigged against them. It's not enough for a tax system to be fair if it's too complicated for the majority of the taxpayers to see that it's fair. Or, since most people who don't want to study the matter will suppose that it's unfair anyway, better for the tax system to make its unfairness explicit instead of hidden in obscurity. For a gold-plated example of the latter, just consider the treatment of pass-through taxation in the new tax law: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3089423 Your eyes will glaze over, because it's irrelevant to W-2 wage earners, but it's critical for retaining and increasing the fortunes of certain kinds of business owners... particularly real estate investors. It's all about making sure that such individuals get taxed at the lower corporate rate rather than the higher individual rate, while trying to make sure that most W-2 earners can't get the same benefit. So the one-flat-tax.net idea is a single flat tax on all sources of discretionary income. To keep it simple, there might be one zero bracket amount (varying with family size) for all taxpayers, reflecting the cost of staying alive and in employable condition, and another deduction for W-2 wage earners to reflect the cost of earning income; these amounts would not be subject to tax. The "flat" part intends to remove the incentive for fancy tax-motivated transactions to move income from high rates to low rates; the "one" part intends to remove the regressive payroll, sales, and property taxes as sources of general government funding. ===== impact 304 impactrate 0 likeimpress 1 negative 0 posted 2017-12-28 ratio 4 react 6 reactrate 0 shares 1 sharesrate 0 sumclicks 4 title Discretionary Income topic tax wordrate 0 words 507 ID 556365264707997 URL https://www.facebook.com/politicalscrapbooknet/posts/556365264707997 audclicks 4 audreach 4 engaged 6 impress 50 likeclickusers 6 likeimpress 1 likeuimpress 43 likeusers 1 likeuusers 22 matchedotherclicks 4 oimpress 50 oreach 27 posted "12/28/2017 12:09:00 PM" postotherclicks 4 reach 27 sharesimpress 1 sharesusers 1 type Link ========== Getting to 60 on Tax Reform It's hard to believe that the Republicans think voters will thank them for their billionaire tax relief bill, no matter how they slice and dice the House and Senate versions to come up with a conference version. If the Republicans are right, then it's a reminder that people get the government they deserve. It brings to mind a recent Simpsons episode set in feudal times where Homer talks about how much he enjoys being a feudal serf for his feudal lord. But ordinary Republican W-2 earner voters don't seem to be buying the Republican leadership lines; they accept it's just another scheme to make the rich richer and the poor poorer. Lots of them still support Trump anyway, presumably for other reasons. Actually it's not clear that even the major Republican donors that bought and paid for the Republican tax plan will be happy; Trump in April and the congressional leadership in September promised that the estate tax, alternative minimum tax, and pass-through taxation would be completely and immediately repealed - and instead there are a bunch of complicated partial measures phasing in and out. Tax simplification always seems to make the tax code longer somehow, but this is worse than usual. That's because the Republicans have been desperately trying to get to 50 votes so they can get their bill through the Senate under reconciliation with no Democratic support. Instead of aiming for 50 votes for a bill that will embarrass everybody that supported it for the rest of their careers, why didn't they aim for 60 votes for something they could be proud of? It wouldn't be that hard to find 30 Republican and 30 Democratic votes for revenue-neutral tax relief for working and middle class families. That's what Republicans and Democrats are SUPPOSED to be doing. That's what Republicans and Democrats SAY they are doing. Government for the People, you know? But instead it got Trumped by Government for the Billionaires. Well why not - billionaires are people too, just like you and me - except they have more money. Lots more money. Perhaps there needs to be another website in this collection - get-to-sixty.net - just in case the Republican tax bill conference effort runs off the tracks and produces something that can't pass both houses. Start over, take your time, and get to sixty votes. Maybe it will be good enough that the Democrats won't immediately repeal it as soon as they get control of Congress during the next bear market. ===== comments 1 hide 1 impact 253 impactrate 0 likeimpress 1 negative 1 posted 2017-12-04 ratio 1 react 6 reactrate 0 sharesrate 0 sumclicks 3 title Getting to 60 on Tax Reform topic tax wordrate 0 words 422 ID 545789985765525 URL https://www.facebook.com/politicalscrapbooknet/posts/545789985765525 audclicks 3 audreach 1 commentsimpress 1 commentsusers 1 engaged 3 hideclicks 1 hideclicksusers 1 impress 22 likeclickusers 2 likeimpress 1 likeuimpress 19 likeusers 1 likeuusers 8 matchedotherclicks 3 negclicks 1 negusers 1 oimpress 22 oreach 9 posted "12/04/2017 10:11:15 PM" postotherclicks 1 reach 9 type Status ========== What happens next on the Republican tax bill? It's past midnight in DC and there's no news that the Republican tax bill has passed in the Senate, nor that the Senate has adjourned. Guessing that a vote will be taken and the bill will pass 51-49 as expected sometime in the wee hours, what next? It might be a good idea for the House to swallow its pride and just pass the Senate bill exactly as it passed the Senate and send it on to the President to sign Monday afternoon - assuming there is at least one legible copy of the bill available for the House to pass and another for Trump to sign. The bill that passed the Senate was marked up by hand at one point. "Speed kills" is not the way Republicans were thinking about it - "delay kills" is more like it. So if the House insists on a conference committee, it risks trying to come up with a compromise between the House and Senate versions, which might lose two votes in the Senate and become impassable, or if they delay past the Alabama election on Dec 12 there will be another lost vote, or the anxiety from the Russian investigation might distract Trump and lead him to say something unhelpful, or the longer the bill sits unpassed, the more peculiar provisions will come to light and to the attention of the public and special interests, so that a senator or two might become convinced that the future is brighter without passing this particular bill. Light is not good for this bill; it was produced in the dark very quickly and has a very short shelf life. Like beer without preservatives, "keep cold and dark and consume promptly." ===== impact 59 impactrate 0 negative 0 posted 2017-12-01 ratio 4 react 2 reactrate 0 sharesrate 0 sumclicks 2 title What happens next on the Republican tax bill? topic tax wordrate 0 words 293 ID 544393405905183 URL https://www.facebook.com/politicalscrapbooknet/posts/544393405905183 audclicks 2 audreach 2 engaged 2 impress 23 likeclickusers 2 likeuimpress 18 likeuusers 8 matchedotherclicks 2 oimpress 23 oreach 9 posted "12/01/2017 10:06:17 PM" postotherclicks 2 reach 9 type Status ========== Taxation of Principal Residences There's a lot of tax law provisions to encourage home ownership in various ways. The one-flat-tax scheme eliminates two: the deduction for mortgage interest and property taxes on real estate not used for business. That's partly compensated since the zero bracket amount is intended to cover basic housing costs, Keep America Great Accounts provide ample low-cost funds for principal residences, and property taxes to fund general government are repealed and replaced by the Federal collection allocated for state income tax. That still leaves special-purpose property taxes and capital gains on sale of principal residences as sources of concern, particularly to senior citizens on fixed incomes who fear being taxed out of their homes, on the one hand, and having to pay capital gains on the sale if they want to relocate to a smaller house or a lower-cost-of-living locale. So many states have mechanisms to defer property taxes to some extent, and Federal and most state tax laws allow deferral of capital gains on sale of a principal residence to some extent. Why not keep it simple: allow deferral of property taxes and capital gains on principal residence until death. The first is a matter of state law though the Federal government could facilitate matters by paying deferred property taxes for principal residences to the states and collecting at death. Under one-flat-tax, capital gains is strictly a Federal matter, that could be deferred until death. The deferred property tax and capital gain are a debt to the Federal government which becomes due at death of the owner(s) or a year after sale if no replacement principal residence is purchased - if a replacement principal residence is purchased, the debt rolls over to the replacement principal residence. Principal residences only, excluding any part of the property used for commercial purposes, and only one principal residence at a time. Divorce settlements would have to specify how the debt is divided. At death, after the deferred property tax and capital gain tax are paid, the basis of the property steps up to its current market value and the principal residence is excluded from estate tax. Altogether that seems to be an adequate incentive for home ownership. Dollar limits could be placed on any of these benefits, but simpler is usually better. ===== negative 0 posted 2017-12-01 rate 0 title Taxation of Principal Residences topic tax words 382 ID 544385532572637 URL https://www.facebook.com/politicalscrapbooknet/posts/544385532572637 impress 12 likeuimpress 12 likeuusers 4 oimpress 12 oreach 4 posted "12/01/2017 09:37:27 PM" reach 4 type Status ========== If the Republican tax bill gets signed into law, express your thanks! Even in advance! It is looking more likely that the Republicans will find the price of 50 votes to pass a tax reform bill in the Senate, and then it is highly likely that some compromise will pass both houses and be signed by Trump. https://www.washingtonpost.com/blogs/plum-line/wp/2017/11/29/those-republicans-who-are-undecided-on-the-tax-bill-dont-believe-them-for-a-minute/ If your Representative or Senators vote for it, you should take the opportunity to congratulate them; if they've already promised to vote for whatever comes out of conference, you can even congratulate them in advance: Well done, good and faithful servants, enter into the joy of your donors! W-2 workers, retirees, students, unemployed, disabled join together today in praise of the Republican tax bill. We're proud to be able to stand up on our own two feet so that hard-working billionaire donors can relax. When billionaire donors can relax, then Senators and Representatives can relax about the 2018 primaries! And since runaway deficit financing might undermine the billionaires' hard-won gains, we also endorse your next big step, as soon as you're past the 2018 election - welfare reform - reducing Federal expenditures like medicaid, medicare, social security, ... that keep expanding the deficit and don't do a thing to help our hard-pressed billionaires. ===== impact 105 impactrate 0 likeimpress 2 negative 0 posted 2017-11-29 ratio 2 react 5 reactrate 0 shares 1 sharesrate 0 sumclicks 2 title If the Republican tax bill gets signed into law, express topic tax wordrate 0 words 210 ID 543350196009504 URL https://www.facebook.com/politicalscrapbooknet/posts/543350196009504 audclicks 2 audreach 1 engaged 2 impress 28 likeclickusers 1 likeimpress 2 likeuimpress 21 likeusers 1 likeuusers 8 matchedotherclicks 2 oimpress 28 oreach 12 posted "11/29/2017 11:08:36 AM" postotherclicks 1 reach 12 sharesimpress 1 sharesusers 1 type Link ========== Craft Beer and Taxes - an object lesson I like craft beer pretty well - there's an entry in the political-scrapbook website. So as far as I could tell, the idea of Sen Portman, R-OH, https://www.brewbound.com/news/proposed-senate-tax-bill-benefit-brewers, to give craft brewers a break, seemed reasonable enough. He added it to the Republican Senate tax reform bill. But what about the next break for somebody else? And the ten more after that, and then another hundred, and then a thousand? Pretty soon you've got a whole internal revenue code full of special breaks for special people, groups, businesses, or industries, and if you are not one of them, you might justifiably conclude that the whole deck is stacked against you. It isn't enough to be fair - laws should be perceivably fair. And so I conclude that if a tax break isn't important enough to pass Congress on its own, then it shouldn't pass Congress as a barnacle on something bigger. ===== comments 1 hideall 1 impact 63 impactrate 0 likeimpress 1 negative 1 posted 2017-11-27 ratio 5 react 4 reactrate 0 sharesrate 0 sumclicks 1 title Craft Beer and Taxes - an object lesson topic tax wordrate 0 words 158 ID 542572066087317 URL https://www.facebook.com/politicalscrapbooknet/posts/542572066087317 audclicks 1 audreach 1 commentsimpress 1 commentsusers 1 engaged 2 hideallclicks 1 hideallclicksusers 1 impress 55 likeclickusers 2 likeimpress 1 likeuimpress 11 likeusers 1 likeuusers 5 matchedotherclicks 1 negclicks 1 negusers 1 oimpress 55 oreach 23 posted "11/27/2017 03:02:07 PM" postotherclicks 1 reach 23 type Status ========== Reasons to dislike the one-flat-tax framework Compared to the current Federal tax system, or compared to what the Republicans are proposing in Congress, what billionaires might find most objectionable about the one-flat-tax framework is that there is no legal escape from the flat tax rate: no escape by income shifting to lower tax years no escape by income shifting to long term capital gains no escape by investing in municipal bonds no escape by establishing residence in a low-income-tax state no escape by taxing the future There's also: no escape from the estate tax Most ordinary voter/W-2 taxpayers don't know about any of these escapes because they aren't available to them or wouldn't help. An essential part of the framework is to balance the budget within a few years and pay off the national debt in a generation or two. There's no built-in bias for a large or a small government - just a bias that whatever is voted for gets paid for, and the only way to reduce the tax rate is to reduce expenditure. Surveys in California at least indicate most voters favor specific government benefits - social security, medicare, medicaid, veterans - and many favor a strong defense as well. If, however, the same inquiry is posed as a question about which taxes to raise in order to pay for those things - the answer is usually "somebody else's." This intellectual disconnect is honed by politicians who know better but don't act better. That needs to change. The experience of other western democracies is that government tends to have a larger role over time, and voters gripe about paying for it but are loathe to give up any benefits. So the ultimate objection from billionaires would probably be no escape from a slowly increasing flat tax rate - until it becomes painful to the average voter/taxpayer ===== negative 0 posted 2017-11-27 rate 0 title Reasons to dislike the one-flat-tax framework topic tax words 309 ID 542525962758594 URL https://www.facebook.com/politicalscrapbooknet/posts/542525962758594 impress 10 likeuimpress 10 likeuusers 5 oimpress 10 oreach 5 posted "11/27/2017 11:49:29 AM" reach 5 type Status ========== Bypassing progressive income tax by unrecaptured section 1250 gain That's a catchy title! But what it means is, that if you can afford to invest in commercial real estate, you can keep your maximum tax rate at 25% instead of 39.6%. If you buy a car or a computer for your business, you are not usually allowed to deduct it all in one year. Instead you deduct a part of the cost over several years, thereby reducing your income taxable at the usual rates up to 39.6%. This makes sense; your car or computer started losing value the day you took it home. If you at some point sell the car or computer for more than its depreciated value, the excess depreciation is recaptured and taxed at ordinary income rates. You've managed to defer some of your taxes for several years, but you eventually pay at the same rate. Real estate is different. That's why it's such a popular investment, if you can afford it. You are allowed to depreciate real estate buildings (but not land), even though real estate doesn't depreciate in urban California and many other parts of the country - it continues to go up in value even if you let it go to wrack and ruin. After all, some social media gazillionaire might want to buy your real estate (and some of your neighbors) just for the lots, so the lots can be combined to make room to build a palace. Better yet, when you do sell, the imaginary depreciation that you deducted against ordinary income at rates up to 39.6% - is recaptured at capital gains rates of up to 25%. So you not only get to defer taxes, you get taxed at a lower rate. (Prior to 1986, this worked even for passive investors in limited partnerships. Now it's mostly available to active real estate investors. It also used to be possible to take accelerated depreciation on real estate, though perhaps subject to AMT.) If all income were taxed at the same rate - as one-flat-tax.net proposes - then commercial real estate might not be quite as attractive an investment. You'd still get to defer taxation - but when you sold, it would be at the flat tax rate in effect then, which might be higher or lower than that on the income you deferred, but most likely will not be much different. Commercial real estate might decline a little in value without that tax break. That sounds like a bad thing for investors. But what if you are a would-be owner-occupied homeowner tired of competing with investors outbidding you for single-family residential property that they want for rentals? If some of those investors get discouraged and single-family residential property becomes less expensive, that sounds like a good thing for prospective homeowners. But there will still be plenty of other would-be homeowners competing, so don't expect too much of a drop in real estate prices. How does depreciation work in a one-flat-tax scheme? It could work somewhat at present, with depreciation taken over the life of the asset and recaptured at about the same rate on disposal of the asset. But does it make sense to grant even the tax deferral benefit when there is no actual cash expense? Perhaps it's better, and certainly simpler, for all assets, to allow deductions of the actual amount spent in the years spent, and tax the actual amount gained, if any, in the year of disposal. You get a tax deferral benefit according to the actual cash spent, but no conversion from ordinary income rates to capital gain rates, because they are the same. ===== impact 121 impactrate 0 negative 0 posted 2017-11-27 ratio 4 react 2 reactrate 0 sharesrate 0 sumclicks 2 title Bypassing progressive income tax by unrecaptured section topic tax wordrate 0 words 607 ID 542499116094612 URL https://www.facebook.com/politicalscrapbooknet/posts/542499116094612 audclicks 2 audreach 1 engaged 1 impress 16 likeclickusers 1 likeuimpress 14 likeuusers 8 matchedotherclicks 2 oimpress 16 oreach 8 posted "11/27/2017 10:10:25 AM" postotherclicks 1 reach 8 type Status ========== Double Taxation of Dividends Comment: "Let's say I have a couple million dollars. With dividends being tax free I can buy dividend paying stocks and live on 75 to 80 thousand a year tax-free! Cool. All the people earning wages of 75 to 80 thousand will owe income tax, but not me! People with money really make out with this tax bill. People that live on wages, not so much." Federal tax law has generally had some provision to avoid double taxation of dividends. To see why, suppose that you were the owner of all the stock of the corporation and you decided that all net profits would be returned as dividends to the shareholders, namely yourself. Those dividends might be taxed at the corporate level and be tax free to the recipient, or tax-free at the corporate level and taxed to the recipient. If the corporate and personal tax rate were the same, there would be no difference. You end up paying the same tax at one level or the other. If instead you are only a small shareholder in a large corporation, you don't get to decide how much of earnings is returned to shareholders. But none the less the value of your shares is reduced by the amount paid as tax at the corporate level. Taxing at the corporate level rather than the recipient level has the property that all corporate dividends are taxed. But if dividends are taxable to the recipient, then non-taxable entities will pay no tax. Some people might view this as a feature, others as a bug. ===== comments 1 impact 53 impactrate 0 negative 0 posted 2017-11-20 ratio 3 react 2 reactrate 0 sharesrate 0 sumclicks 1 title Double Taxation of Dividends topic tax wordrate 0 words 264 ID 539647763046414 URL https://www.facebook.com/politicalscrapbooknet/posts/539647763046414 audclicks 1 audreach 1 commentsimpress 1 commentsusers 1 engaged 2 impress 17 likeclickusers 1 likeuimpress 15 likeuusers 7 matchedotherclicks 1 oimpress 17 oreach 7 posted "11/20/2017 04:25:35 PM" postotherclicks 1 reach 7 type Status ========== How do you tax Discretionary Income? Discretionary income is the income that you have some choice about how you spend. For an individual, it means what's left over after you provide the necessities of life and the costs of generating income - for most people, the costs of qualifying for a job and getting to a job and performing a job. For a business, it's what's left of your sales receipts after you have paid for the all the costs of producing or providing what you sold: "ordinary and necessary expenses" of the particular business you're in. So is a lawyer or a dentist, a business or a job? What about an venture capital company with one owner? Those are questions at the heart of the arguments about pass-through income treatment in the Republican tax proposals. From the point of view of taxation, to avoid non-economic shifting of income between business and personal income, one would like to have the same tax rate on discretionary income, whether generated as a business or a job. A flat tax rate accomplishes that. But what about the ordinary and necessary expenses of a business vs the ordinary and necessary expenses of having a job? You can't have a job without eating enough to stay alive, a place to stay when you're not working, transportation to the job, suitable clothing and equipment for the job. Of course, basic food/clothing/shelter are things you need anyway whether you have a job or not. They are ordinary and necessary expenses of staying alive. So if we want taxation to be fair between business owners and employees, how do we figure what's discretionary? The way Federal income tax works now, there are some adjustments, deductions, and credits for various expenses associated with producing personal income. There is a zero bracket - an amount of income which is not taxed, built into the standard deduction and the personal exemptions. Perhaps this is intended to cover the cost of staying alive. So businesses should get no zero bracket, but deduct all ordinary and necessary business expenses. Individuals get a zero bracket, but can't deduct ordinary and necessary staying-alive expenses. Which is fairer? One could have a complicated system in which individuals deducted ordinary and necessary staying-alive expenses. But in a three-bedroom house for two people, which part of the rent or mortgage is going toward staying alive and which is a choice about spending discretionary income? If both work and need reliable transportation, is three unreliable cars to have backup a necessity, but three new reliable cars at least 1/3 discretionary income? In politics, fairness has to be perceived. A system that is so complicated that most voters can't understand it will be perceived to be unfair - and often that perception will be correct. So perhaps it would be perceptibly fairer for personal income tax to have a much larger zero bracket than now for basic living expenses to cover staying alive, and perhaps an additional zero bracket for persons with earned income to cover going go work, but no explicit adjustments, deductions, or credits. Of course, larger zero brackets mean the flat tax rate would be higher. Fixed zero brackets without deductions is less fair than the current system in that there is less consideration of individual circumstances, but more fair in that everybody can understand how it works and can have confidence that there aren't any intentionally obscure exceptions. ===== negative 0 posted 2017-11-20 rate 0 title How do you tax Discretionary Income? topic tax words 572 ID 539591233052067 URL https://www.facebook.com/politicalscrapbooknet/posts/539591233052067 impress 13 likeuimpress 13 likeuusers 6 oimpress 13 oreach 6 posted "11/20/2017 12:19:44 PM" reach 6 type Status ========== Which California Representatives voted against the Billionaire Tax Relief and Democratic State Punishment Act on November 16? All the Democrats and (surprise!) three Republicans: California 4: Tom McClintock (R) (since 2009) California 48: Dana Rohrabacher (R) (since 1989) California 49: Darrell Issa (R) (since 2001) http://www.cnn.com/2017/11/16/politics/house-republicans-vote-no-tax-bill/index.html The rest of the California Republicans should be recalled, but since we can't, we can only censure and vote better in 2018. The first five are part of the California 7 Project: California 10: Jeff Denham (R) (since 2011) California 21: David Valadao (R) (since 2013) California 25: Steve Knight (R) (since 2015) California 39: Ed Royce (R) (since 1993) California 45: Mimi Walters (R) (since 2015) California 1: Doug LaMalfa (R) (since 2013) California 8: Paul Cook (R) (since 2013) California 22: Devin Nunes (R) (since 2003) California 23: Kevin McCarthy (R) (since 2007) California 42: Ken Calvert (R) (since 1993) California 50: Duncan D. Hunter (R) (since 2009) https://www.ca7project.com/ ===== impact 16 impactrate 0 negative 0 posted 2017-11-17 ratio 6 react 1 reactrate 0 sharesrate 0 sumclicks 1 title Which California Representatives voted against the topic tax wordrate 0 words 155 ID 538203993190791 URL https://www.facebook.com/politicalscrapbooknet/posts/538203993190791 audclicks 1 audreach 1 engaged 1 impress 14 likeclickusers 1 likeuimpress 12 likeuusers 5 matchedotherclicks 1 oimpress 14 oreach 6 posted "11/17/2017 07:29:11 AM" postotherclicks 1 reach 6 type Link