A Boring Dystopia

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The Secret IRS Files: Trove of Never-Before-Seen Records Reveal How the Wealthiest Avoid Income Tax (www.propublica.org)

submitted 6 months ago by [email protected] to c/[email protected]

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[–] [email protected] 20 points 6 months ago (1 children)

Warren Buffet is hypocritical piece of shit.

No one among the 25 wealthiest avoided as much tax as Buffett, the grandfatherly centibillionaire. That’s perhaps surprising, given his public stance as an advocate of higher taxes for the rich. According to Forbes, his riches rose $24.3 billion between 2014 and 2018. Over those years, the data shows, Buffett reported paying $23.7 million in taxes.

That works out to a true tax rate of 0.1%, or less than 10 cents for every $100 he added to his wealth.

[–] [email protected] -5 points 6 months ago* (last edited 6 months ago) (2 children)

My "true tax rate" is a low single digit number too, if you measure it the same way, and I make ~$50k a year.

It's extremely disingenuous to talk about taxes paid as a percentage of income, and as a percentage of total wealth/net worth, in the same breath, as if they are anywhere near the same thing.

It's also extremely disingenuous to say someone is 'avoiding tax' by not paying tax on their unrealized gains in net worth. He doesn't OWE any tax on that. NOBODY in the US does.

This is like calling someone a draft dodger, who was never drafted, lol.

[–] [email protected] 7 points 6 months ago (1 children)

Normal people regularly owe taxes on unrealized gains. That's what property tax increases are.

[–] [email protected] -4 points 6 months ago (1 children)

Property taxes are not levied federally, but on the state level
Buffett pays property tax too

Not sure what point you were trying to make here, lol. There is no type of unrealized gain that "normal people" are taxed on (federally or otherwise), but Buffett isn't.

[–] [email protected] 4 points 6 months ago (2 children)

I had hoped the point would be pretty obvious. Most people's homes represent a significant part of their net worth, often a majority of their assets. The unrealized gains on that are taxed.

Billionaires generally (are there even any counterexamples?) do not have the majority of their net worth stored in assets that are taxed the same way. It's a meaningful difference.

[–] [email protected] 3 points 6 months ago

It is kinda weird that real estate gets taxed just for existing and being held, but stocks, which supposedly represent a fraction of a mass of real wealth too, don't get taxed while just being held.

[–] [email protected] 2 points 6 months ago (1 children)

are there even any counterexamples?

Actually, there are a large number of billionaires whose primary assets are literally property.

https://www.forbes.com/sites/giacomotognini/2023/10/04/the-richest-real-estate-billionaires-in-america-2023/

I had hoped the point would be pretty obvious. Most people’s homes represent a significant part of their net worth, often a majority of their assets. The unrealized gains on that are taxed.

But the real question is, do you think they should be? 'Cause I'm with you if you say no. Unrealized gains should not be taxed at all, it makes no sense.

[–] [email protected] 1 points 6 months ago

You're misunderstanding how their wealth is distributed. By and large, they're not directly owning the land and paying taxes. They just own significant stakes in the actual companies holding property. I'm sure they own a house or three, but it's not significant compared to their other assets.

I'm not taking a position on whether property taxes are good. I think they are. I'm just pointing out the discrepancy.

[–] [email protected] -1 points 6 months ago (1 children)

Nothing steps Warren Bufffet from taking an income instead of relying upon their wealth.