Warm Southern Breeze

"… there is no such thing as nothing."

Posts Tagged ‘ProPublica’

A Taxing Proposition

Posted by Warm Southern Breeze on Wednesday, June 9, 2021

“Taxes are what we pay for civilized society, including the chance to insure.


A penalty, on the other hand, is intended altogether to prevent the thing punished.”

–– U.S. Supreme Court Justice Oliver Wendell Holmes, Jr., dissenting opinion, “Compañía General de Tabacos de Filipinas v. Collector of Internal Revenue,” 275 U.S. 87, October term 1927, p100

On that court were Chief Justice William Howard Taft; Associate Justices Oliver Wendell Holmes, Jr.; Willis Van Devanter; James C. McReynolds; Louis Brandeis; George Sutherland; Pierce Butler; Edward T. Sanford, and; Harlan F. Stone.

Holmes, Brandeis, and Taft are the only names many remember from that group.

Then-POTUS Warren G. Harding, a Republican, nominated Taft, also a Republican, to become Chief Justice (1921–1930) following the death of CJ Edward Douglass White, a Democrat, whom Taft had appointed as CJ in December 1910, while Taft was serving as President (1909–1913). Taft is, to-date, the only individual to have ever served in both positions – President, and SCOTUS Chief Justice.

But, here are a couple interesting facts:

1.) From July 4, 1901 until December 23, 1903, Taft was Governor-General of the Philippines, having been appointed by POTUS William McKinley. Having held that office previously, he should have recused himself from the 1927 case “Compañía General de Tabacos de Filipinas v. Collector of Internal Revenue.” But, he did not.

2.) Edward Douglass White served in the Confederate Army during the Civil War, was a strident segregationist, and upheld racist laws which came before the court, including the notorious Plessy v. Ferguson case which gave rise to the “separate but equal” doctrine, and reinforced racist practices in the United States.

Today, such obvious conflicts of interest would not be tolerated. And I note this with a mark of appreciation: Justice Brett Kavanaugh recently recused himself (did not participate in) from a recent case before the court, because his father held some stock in one company being represented to the court.

Technically, “involvement” at that level exclusively doesn’t violate ethics rules, but having erred on the side of caution – exercised jurisprudential reservation – is commendable. That is because it demonstrates Read the rest of this entry »

Posted in - Business... None of yours, - Even MORE Uncategorized!, - Politics... that "dirty" little "game" that first begins in the home. | Tagged: , , , , , , , , , , , , , | Leave a Comment »

It’s True: The Über-Wealthy Pay ZERO Income Taxes

Posted by Warm Southern Breeze on Wednesday, June 9, 2021

Moochers.


We are disclosing the tax details of the richest Americans because we believe the public interest in an informed debate outweighs privacy considerations.

Today, ProPublica is launching the first in a series of stories based on the private tax data of some of our nation’s richest citizens. We obtained the information from an anonymous source who provided us with large amounts of information on the ultrawealthy, everything from the taxes they paid to the income they reported to the profits from their stock trades.

In the coming months, we plan to use this material to explore how the nation’s wealthiest people — roughly the .001% — exploit the structure of our tax code to avoid the tax burdens borne by ordinary citizens.

Many will ask about the ethics of publishing such private data. We are doing so — quite selectively and carefully — because we believe it serves the public interest in fundamental ways, allowing readers to see patterns that were until now hidden.

Tax experts have long understood that the wealthiest Americans reap outsized benefits from the federal tax code’s emphasis on taxing income rather than assets like stock holdings and property. Yet, when The New York Times disclosed in 2020 that President Donald Trump had amassed so many deductions he paid no taxes in 11 of 18 years, it was assumed that his case was an anomaly, reflecting the unique breaks real estate developers receive under our tax system.

It is now clear that there isn’t just one such taxpayer — there are many, in multiple industries. We believe that disclosing the identities of billionaires who paid little to no taxes in years their fortunes grew by billions of dollars will help readers understand the magnitude of the tax advantages the ultrarich enjoy.

https://www.propublica.org/article/why-we-are-publishing-the-tax-secrets-of-the-001


“America’s billionaires avail themselves of
tax-avoidance strategies
beyond the reach
of
ordinary people.
Their wealth derives from the
skyrocketing value of their assets,
like stock and property.
Those gains are not defined
by U.S. laws as taxable income
unless and until the billionaires sell.”

In 2007, Jeff Bezos, then a multibillionaire and now the world’s richest man, did not pay a penny in federal income taxes. He achieved the feat again in 2011. In 2018, Tesla founder Elon Musk, the second-richest person in the world, also paid no federal income taxes.

Typical Americans his age paid more in taxes than they saw in wealth growth over that period.

For every $100 of wealth growth from
2006 to 2018,
typical Americans paid $160 in taxes.

Bezos paid only $1.09.

Michael Bloomberg managed to do the same in recent years. Billionaire investor Carl Icahn did it twice. George Soros paid no federal income tax three years in a row.

ProPublica has obtained a vast trove of Internal Revenue Service data on the tax returns of thousands of the nation’s wealthiest people, covering more than 15 years. The data provides an unprecedented look inside the financial lives of America’s titans of business, including Warren Buffett, Bill Gates, Rupert Murdoch and Mark Zuckerberg. It shows not just their income and taxes, but also their investments, stock trades, gambling winnings and even the results of audits.

Taken together, it demolishes

The Cornerstone myth of the American tax system:

That everyone pays their fair share and the richest Americans pay the most.

The IRS records show that the wealthiest can — perfectly legally — pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.

Many Americans live paycheck to paycheck, amassing little wealth and paying the federal government a percentage of their income that rises if they earn more. In recent years, the median American household earned about $70,000 annually and paid 14% in federal taxes. The highest income tax rate, 37%, kicked in this year, for couples, on earnings above $628,300.

The confidential tax records obtained by ProPublica show that the ultrarich effectively sidestep this system.

American multi-BILLIONAIRES
LEFT to RIGHT, TOP to BOTTOM: Mark Zuckerberg (Facebook), Michael Bloomberg (Bloomberg), Rupert Murdoch (News Corp), Warren Buffett (Berkshire Hathaway), Carl Icahn (Icahn Enterprises), George Soros (Soros Fund)

America’s billionaires avail themselves of tax-avoidance strategies beyond the reach of ordinary people. Their wealth derives from the skyrocketing value of their assets, like stock and property. Those gains are not defined by U.S. laws as taxable income unless and until the billionaires sell.

To capture the financial reality of the richest Americans, ProPublica undertook an analysis that has never been done before. We compared how much in taxes the 25 richest Americans paid each year to how much Forbes estimated their wealth grew in that same time period.

We’re going to call that their true tax rate.

The results are stark. According to Forbes, those 25 people saw their net worth rise a collective $401 billion from 2014 to 2018. They paid a total of $13.6 billion in federal income taxes in those five years, the IRS data shows. That’s a staggering sum, but it amounts to a true tax rate of only 3.4%.

It’s a completely different picture for middle-class Americans, for example, wage earners in their early 40s who have amassed a typical amount of wealth for people their age. From 2014 to 2018, such households saw their net worth expand by about $65,000 after taxes on average, mostly due to the rise in value of their homes. But because the vast bulk of their earnings were salaries, their tax bills were almost as much, nearly $62,000, over that five-year period.

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.

In the coming months, ProPublica will use the IRS data we have obtained to explore in detail how the ultrawealthy avoid taxes, exploit loopholes and escape scrutiny from federal auditors.

Experts have long understood the broad outlines of how little the wealthy are taxed in the United States, and many lay people have long suspected the same thing.

But few specifics about individuals ever emerge in public. Tax information is among the most zealously guarded secrets in the federal government. ProPublica has decided to reveal individual tax information of some of the wealthiest Americans because it is only by seeing specifics that the public can understand the realities of the country’s tax system.

Consider Bezos’ 2007, one of the years he paid zero in federal income taxes. Amazon’s stock more than doubled. Bezos’ fortune leapt $3.8 billion, according to Forbes, whose wealth estimates are widely cited. How did a person enjoying that sort of wealth explosion end up paying no income tax?

In that year, Bezos, who filed his taxes jointly with his then-wife, MacKenzie Scott, reported Read the rest of this entry »

Posted in - Business... None of yours, - Did they REALLY say that?, - Even MORE Uncategorized!, - Read 'em and weep: The Daily News | Tagged: , , , , , , , , , , , , , , , , , , , , | 1 Comment »

 
%d bloggers like this: