GOP estate tax repeal

[Tsing Tao]

Your example isn’t the apt as you know tax law ahead at the time of the purchased ticket. And to the extent that you don’t know tax law 40 years from now, when you will likely die, that exists with everything in life.

Huh?

The government says if you give your wages to your kids, you pay a tax. The government says, if you buy a car, you pay a tax. Which of these are “theft” and which are not and why? It’s the same dollar. Are you saying the government is not allowing you to buy a car?

If not estate taxes then how should taxes be levied to fund things (like a 25bn wall).

Taxiation: will probably be our future as autonomous driving becomes a reality.[/QUOTE]

Here is a concept for you to understand - as clearly you do not:

https://www.investopedia.com/terms/d/double_taxation.asp

 

[Tsing Tao]

The estate tax isn’t really that much anyway but the GOP is bent on bankrupting the country with their cockamamie economic philosophies so we should all oppose this until there is some fiscal sanity restored in Washington.

But I’m only here to say the following:

***We need to expand the social security tax to all income over $400k and means rest benefit payouts. That would allow for a reduction of the tax burden for all workers earning under $400k while shoring up the biggest liability on the government’s balance sheet.***

Ok, and what is to stop the government from continuing to use Social Security as a piggy bank to borrow against? I am OK with raising it if the government couldn't borrow against it and bankrupt it.

 

[Tsing Tao]

Inheriting a business or a farm isn't really earning it.

Oh yeah? What about a son who works his whole life for his father building a business and when the father passes on, the son takes over. The son didn't earn it? You need to think beyond the talking points your left wing folks give you to read.

 

[Tsing Tao]

It's what they're proposing. The bump from 5 to 11 million happened in'17, the new legislation aims to repeal it altogether.

Currently the estate tax only kicks in for wealth inherited in excess of $11.2 million dollars. Until 2017 the threshold was $5.4 million, but Trump’s tax reform of 2017 more than doubled the amount that could be inherited tax-free.

Earlier in the week, however, Republican senators introduced a very different bill to completely repeal the estate tax. Senator John Thune from South Dakota justified the repeal of the state tax by saying “oftentimes family-owned farms and ranches bear the brunt of this tax, which threatens families’ agricultural legacies and makes it difficult and costly to pass these businesses down to future generations.”

He insinuated the tax was for those above not below the rate.

 

[Tsing Tao]

Raising rates will force more savings and let people earn more over time on fixed income investments.

But it also raises borrowing costs significantly for the majority of people who borrow to live while still within their means and hurts corporate earnings since many do borrow for working capital. It leads to lower stocks markets due to present discount values and capital moving to fixed income securities and dorporate higher cost of borrowing and many people have wealth tied in the stock market (lower to middle class retirement savings).

It is always a double edged sword and never a good balance could be struck because the interest rate pendulum always swings too far one way or the other.

There are equal Pro and Cons so the question is what Pro do you prefer the most. It is hard to nail the middle optimal interest rate.

Raising rates applies the cost of capital appropriately. It doesn't misallocate based on debt gorging. Companies, people, everyone has to live within their means. Savers get rewarded. Over abundance of debt is punished.

Or we can do things the way we've done them the last 30 years and end up being stupid, with a butcher bill to pay at the end.

 

[El OchoCinco]

That is not my point, raising rates is not just an simple fix.

All companies borrow money, many within their means. Raising rates too far pulls a lot of capital out of the economy and raises the cost of doing business across the board. People don't understand that even usccessful businesses do not have adequate cash flow/working capital due to the illiquid nature of many businesses (A/R and inventory). Savers rejoince but that is dead money.

So I repeat what I said, rates should be higher, but finding the magic middle ground is often difficult and the pendulum often overswings the other way.

The Fed pussied out because Trump cried like a bitch because his manhood is defined by the stock market I guess and God forbid it drops a little (he will blame everyone else as he only takes credit for when it goes up).

I think general rates in the 4-6% range has been a sweet spot in past 25 years.

 

[Tsing Tao]

That is not my point, raising rates is not just an simple fix.

All companies borrow money, many within their means. Raising rates too far pulls a lot of capital out of the economy and raises the cost of doing business across the board. People don't understand that even usccessful businesses do not have adequate cash flow/working capital due to the illiquid nature of many businesses (A/R and inventory). Savers rejoince but that is dead money.

So I repeat what I said, rates should be higher, but finding the magic middle ground is often difficult and the pendulum often overswings the other way.

The Fed pussied out because Trump cried like a bitch because his manhood is defined by the stock market I guess and God forbid it drops a little (he will blame everyone else as he only takes credit for when it goes up).

I think general rates in the 4-6% range has been a sweet spot in past 25 years.

Can't argue with any of that, except maybe that savers money is dead money. They often deploy other assets when they know they are getting good, safe interest returns on other investments.

 

[newwurldmn]

Oh yeah? What about a son who works his whole life for his father building a business and when the father passes on, the son takes over. The son didn't earn it? You need to think beyond the talking points your left wing folks give you to read.

The son gets a market wage for his contributions just like any other employee would. There are actually rules about paying above market wages to family
members to circumvent gift tax laws.

If the equity the son inherits is above what non-family employee would receive for comparable contribution to the company then it would be hard to argue that was earned.

 

[newwurldmn]

Huh?



If not estate taxes then how should taxes be levied to fund things (like a 25bn wall).

Taxiation: will probably be our future as autonomous driving becomes a reality.

Here is a concept for you to understand - as clearly you do not:

https://www.investopedia.com/terms/d/double_taxation.asp[/QUOTE]

Your analogy made no sense. Either you knew there was a second fee or you didn’t. If not, that’s your fault. If you did, you should plan accordingly. Or if the second fee changed (and you couldn’t have known) that’s the unfortunate reality of life.

I’m well aware of what double taxation is. As you pointed out earlier the concept of double taxation is not an issue of right or wrong. So I don’t know why you keep bringing that up implying that double taxation is wrong. what is the difference between passing money to your kids and spending it at a store and paying sales tax?

 

[Tsing Tao]

Your analogy made no sense. Either you knew there was a second fee or you didn’t. If not, that’s your fault. If you did, you should plan accordingly. Or if the second fee changed (and you couldn’t have known) that’s the unfortunate reality of life.

I’m well aware of what double taxation is. As you pointed out earlier the concept of double taxation is not an issue of right or wrong. So I don’t know why you keep bringing that up implying that double taxation is wrong. what is the difference between passing money to your kids and spending it at a store and paying sales tax?

You can know about the second fee, and it can still be unfair. You get the concept of mutual exclusivity, don't you?

When I decide to employ money I have made (which has already been taxed) the manner in which I employ this money often comes with expense/risk/cost. For example, choosing to purchase a car is a decision to buy the car for the offered price and sales tax. I see the car, calculate the cost and make the decision. If I don't want to pay the tax or the tax is too much, I don't buy it. Maybe I pay cash to someone on Craigslist for a car. Choosing to invest in the stock market with my money (which has already been taxed) comes with risk of loss. If I make money on that investment, the money I make is taxed via capital gains. That is the price to pay.

At the end of my life, when I wish to bequeath my wealth to my family, I don't have a choice. Sure, I can give it away to charity at no cost, but the choice of giving it to my family or someone else I am not related to is not really a choice (unless I don't want them to have it, in which case I suppose I could set fire to the money in a parking lot or something). All the dollars that I made, and previously paid tax on, have to now be taxed again because I am gifting them to my family.

The fact that you cannot see the difference in this is extremely telling. It speaks to either one of two possibilities, both extremely disconcerting. Either you can't grasp it mentally, or you choose not to. Either you can't recognize the difference because of faulty wiring, or you simply can't bring yourself to say "I see your point, there is a difference." because you believe it gives up the right to be pro the estate tax.

I'm here to tell you. You can recognize the difference and still be for the tax.