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Wealth Tax

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  • Avatar Kamban 
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    Status: Physician
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    I think the tax code is currently progressive, so adding another tier about 9,500,000 above the highest current level doesn’t seem inconsistent. In fact, I think you could call the current tiers arbitrary.

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    Very few of the income earned above 2-3M is straight ordinary income. Most of it is in capital gains. Unless you also want to see an increase in capital gains rate I don’t see that extra income tax bracket really bringing any additional money for the effort put in. But it gives some socialists great villains to throw poison darts ( or spears) at.

    #198077 Reply
    Liked by ENT Doc, Tim, Lordosis
    Avatar Kamban 
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    Status: Physician
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    Joined: 08/01/2016
    It seems they will also chase you down if you try to flee: https://www.cnbc.com/2019/03/08/tax-collectors-chase-rich-new-yorkers-moving-to-low-tax-states.html Congratulations on a successful escape.

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    I have no problem with them fleeing but in the case of the super rich NY who flee, they try to have the cake and eat it too. They want to avoid all the extra taxes but also want to savor the glitz of NY. I say to them – if you want to enjoy all that extra money that you don’t want to give to NY then stay put in the boondocks and don’t come to NYC often or have a expensive apartment there.

    #198078 Reply
    Liked by iradoc, BCBiker, Zaphod, Tim
    The White Coat Investor The White Coat Investor 
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    Status: Physician
    Posts: 4263
    Joined: 05/13/2011

    “The complexity is simply mind blowing and frankly impossible.”

    At some point, impossibility gives way to reality. Like, why screw around with the hard stuff?
    Checking account ? Tax it.
    Bank account ? Tax it.
    401k ? Tax it.
    IRA ? Tax it.
    New Year’s Eve? That sucking sound is piece of cash being sucked outta yo wallet.
    No reason to wait for a return, it’s not net wealth it’s a cash grab. Why bother with exemptions? It’s all for a good cause. Can’t wait for January 2, forced liquidation.
    Geez really simple, take the money.

    Cool part is even tax churches and hospitals and charities. Eliminates lobbyists! Gone!

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    No, its not that simple. Gonna tax my 401(k)? Do I have to pay the early withdrawal penalty if I pay the tax from the 401(k) or not?

    Gonna tax my bank account but not my whole life policy? Okay, I’ll “Bank on Myself.”

    Gonna tax my mutual fund account but not my rental property? Okay, I’ll change my portfolio to 20/80 instead of 80/20.

     

    Site/Forum Owner, Emergency Physician, Blogger, and author of The White Coat Investor: A Doctor's Guide to Personal Finance and Investing
    Helping Those Who Wear The White Coat Get A "Fair Shake" on Wall Street since 2011

    #198098 Reply
    Liked by Hank, Tim
    Avatar Tim 
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    Status: Accountant
    Posts: 2127
    Joined: 09/18/2018

    Yes, it’s a cat. and mouse game. Nice move.
    Now tax wealth on value on the property tax roll,
    tax the premium deposits on the life insurance policy held by the insurance company, require withholding tax on life insurance proceeds upon you unfortunate demise. My point is simply the federal government has used “wealth “ as a qualification but never “taxed wealth”. Some have spent years and structures that have real economic consequences. The movement for wealth redistribution will shoot for it the easiest way possible. Changing the rules will be extremely disruptive. Grandfathering old arrangements has been the technique. The goal of the wealth tax is to get money. That’s what it would do, simply grab it.

    It has been done before in different countries. Not with good results. Destroying wealth is harmful. That doesn’t mean it won’t happen as some are floating it as being “fair and just”.

    #198100 Reply
    Zaphod Zaphod 
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    Status: Physician, Small Business Owner
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    Higher tax rates do nothing because people will just structure their assets in a way to avoid them. Do you think it’s by coincidence that buffett pays like 15% tax?

    If you want to increase tax revenue you do it by removing deductions, not changing rates. Rates don’t mean anything because if you can claim a trillion deductions those rates are never realized. Eliminate all deductions, tax all income the same. Get rid of the irs and simplify it all.

    There is 0 evidence that increasing tax rates will do anything productive. It will lead to increased rates of tax evasion, more complexity to the accounting and if anything will hurt the “low upper class (relatively, like doctors) way more than it will hurt the mega rich, who can employ 20 accountants to structure their stuff in most tax efficient way possible.

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    Buffetts tax rate has zero to do with structure of anything other than the tax code. He doesnt make much income. Its solely to do with source of income and its preferential tax treatment.

    #198107 Reply
    Avatar Panscan 
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    Joined: 03/18/2017

    He’s a bad example, think someone like our president.

    #198109 Reply
    Avatar scottvoiers 
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    Status: Dentist
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    Joined: 03/17/2019

    No no no to all taxes. No exceptions. It is un-American.

    #201282 Reply
    ReFinDoc ReFinDoc 
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    Status: Physician
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    Joined: 01/09/2016

    Personally, I believe a Wealth tax is quite likely. American politics works in mysterious ways. Look at the passage of Obamacare…a certain political alignment (say, controlling both Houses of Congress and POTUS) and look at what arises. It won’t be called a Wealth Tax, it will be hidden in surcharges, fees, income caps etc.

    Either way, predicting future tax rates is impossible and has no value.

    #201286 Reply
    Zaphod Zaphod 
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    Status: Physician, Small Business Owner
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    Personally, I believe a Wealth tax is quite likely. American politics works in mysterious ways. Look at the passage of Obamacare…a certain political alignment (say, controlling both Houses of Congress and POTUS) and look at what arises. It won’t be called a Wealth Tax, it will be hidden in surcharges, fees, income caps etc.

    Either way, predicting future tax rates is impossible and has no value.

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    Right, future taxes through already available pathways is a no brainer and totally possible way to address a wealth tax. The net worth taxing being discussed is ridiculously complex and wont come through.

    #201289 Reply
    Liked by ENT Doc
    Avatar Panscan 
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    Joined: 03/18/2017

    They will likely keep increasing SS age and then tax 401k. Too many hands in the pot, not enough money feeding the pot. Simple math

    #201290 Reply
    Liked by Wiscoblue, Zaphod
    Avatar Peds 
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    Status: Physician
    Posts: 3618
    Joined: 01/08/2016

    No no no to all taxes. No exceptions. It is un-American.

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    ……./

    #201299 Reply

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