CDZ What would you think?

[320 Years of History]

What would you think were you to see, after Trump released his tax returns, that his tax liability over the past year(s) amounted to substantively nothing? What is "substantively nothing" in his case? Well, I can't give a specific number, but it certainly means "materially more than was my tax liability" considering he (according to him) earns hundreds of millions of dollars a year and I do not.

I know I'd be furious. I wouldn't be angered at Trump himself. I'd be irked that he managed to avail himself of the tax minimization opportunities in the tax code, or more accurately, I'd be furious that such opportunities exist. I don't blame or despise him for taking advantage of those opportunities; nobody wants to pay more in taxes.

I would expect (on the basis of fairness in taxation/tax code provisions) that his liability and tax rate be about what the Clintons was. I mean really, by what measure is it just that a person who, say, earns $2M in a year can minimize their tax liability to $500K (25% effective tax rate) and a person earning $200M should realize a notably lower (20% or less) effective tax rate due to "this and that" so-called "loophole?"

And make no mistake, Trump in in the real estate business; few, if any, other ways of making money offer the tax minimization opportunities that real estate development does. If you happen to own a rental property, you surely know this, even if you don't develop properties on the scale Trump does and thus have access to deductions and exemptions he does. Therein lies the rub. There wouldn't be much cause to be "plucked" about realty's tax minimization opportunities were it not that scale determines whether they are available.

If you are incredulous about or unaware of what I mean, read through the following:

• Ten Tax Loopholes for Active Real Estate Investors | The White Coat Investor - Investing And Personal Finance Information For Physicians, Dentists, Residents, Students, And Other Highly-Educated Busy Professionals
  
• Real Estate Developers: How To Maximize After-Tax Return on Development
  
• Tax Planning for Real Estate Developers
• Basic Tax Considerations for Real Estate Developers
• Tax Planning Opportunities for Real Estate Developers and Investors

The stuff you'll find discussed in the documents above are but a place to start. They are hardly where the opportunities end.

 

[GaryDog]

In before people making $40k per year defend the billionaire for ripping them off....

 

[TooTall]

What would you think were you to see, after Trump released his tax returns, that his tax liability over the past year(s) amounted to substantively nothing? What is "substantively nothing" in his case? Well, I can't give a specific number, but it certainly means "materially more than was my tax liability" considering he (according to him) earns hundreds of millions of dollars a year and I do not.

I know I'd be furious. I wouldn't be angered at Trump himself. I'd be irked that he managed to avail himself of the tax minimization opportunities in the tax code, or more accurately, I'd be furious that such opportunities exist. I don't blame or despise him for taking advantage of those opportunities; nobody wants to pay more in taxes.

I would expect (on the basis of fairness in taxation/tax code provisions) that his liability and tax rate be about what the Clintons was. I mean really, by what measure is it just that a person who, say, earns $2M in a year can minimize their tax liability to $500K (25% effective tax rate) and a person earning $200M should realize a notably lower (20% or less) effective tax rate due to "this and that" so-called "loophole?"

And make no mistake, Trump in in the real estate business; few, if any, other ways of making money offer the tax minimization opportunities that real estate development does. If you happen to own a rental property, you surely know this, even if you don't develop properties on the scale Trump does and thus have access to deductions and exemptions he does. Therein lies the rub. There wouldn't be much cause to be "plucked" about realty's tax minimization opportunities were it not that scale determines whether they are available.

If you are incredulous about or unaware of what I mean, read through the following:

• Ten Tax Loopholes for Active Real Estate Investors | The White Coat Investor - Investing And Personal Finance Information For Physicians, Dentists, Residents, Students, And Other Highly-Educated Busy Professionals
  
• Real Estate Developers: How To Maximize After-Tax Return on Development
  
• Tax Planning for Real Estate Developers
• Basic Tax Considerations for Real Estate Developers
• Tax Planning Opportunities for Real Estate Developers and Investors

The stuff you'll find discussed in the documents above are but a place to start. They are hardly where the opportunities end.

Are you really Senator Harry Reid?

 

[the_human_being]

What would you think were you to see, after Trump released his tax returns, that his tax liability over the past year(s) amounted to substantively nothing? What is "substantively nothing" in his case? Well, I can't give a specific number, but it certainly means "materially more than was my tax liability" considering he (according to him) earns hundreds of millions of dollars a year and I do not.

I know I'd be furious. I wouldn't be angered at Trump himself. I'd be irked that he managed to avail himself of the tax minimization opportunities in the tax code, or more accurately, I'd be furious that such opportunities exist. I don't blame or despise him for taking advantage of those opportunities; nobody wants to pay more in taxes.

I would expect (on the basis of fairness in taxation/tax code provisions) that his liability and tax rate be about what the Clintons was. I mean really, by what measure is it just that a person who, say, earns $2M in a year can minimize their tax liability to $500K (25% effective tax rate) and a person earning $200M should realize a notably lower (20% or less) effective tax rate due to "this and that" so-called "loophole?"

And make no mistake, Trump in in the real estate business; few, if any, other ways of making money offer the tax minimization opportunities that real estate development does. If you happen to own a rental property, you surely know this, even if you don't develop properties on the scale Trump does and thus have access to deductions and exemptions he does. Therein lies the rub. There wouldn't be much cause to be "plucked" about realty's tax minimization opportunities were it not that scale determines whether they are available.

If you are incredulous about or unaware of what I mean, read through the following:

• Ten Tax Loopholes for Active Real Estate Investors | The White Coat Investor - Investing And Personal Finance Information For Physicians, Dentists, Residents, Students, And Other Highly-Educated Busy Professionals
  
• Real Estate Developers: How To Maximize After-Tax Return on Development
  
• Tax Planning for Real Estate Developers
• Basic Tax Considerations for Real Estate Developers
• Tax Planning Opportunities for Real Estate Developers and Investors

The stuff you'll find discussed in the documents above are but a place to start. They are hardly where the opportunities end.

Exactly. Trump did not write the tax code. Many Congressmen and women use these same deductions and loopholes. They exist and there is nothing illegal about using them to your own advantage. Hillary and Bill used the charitable contribution deduction to write off 96% of their charitable contributions listing those charitable gifts aas going to the Clinton Foundation. It is probably legal.

 

[ChrisL]

What would you think were you to see, after Trump released his tax returns, that his tax liability over the past year(s) amounted to substantively nothing? What is "substantively nothing" in his case? Well, I can't give a specific number, but it certainly means "materially more than was my tax liability" considering he (according to him) earns hundreds of millions of dollars a year and I do not.

I know I'd be furious. I wouldn't be angered at Trump himself. I'd be irked that he managed to avail himself of the tax minimization opportunities in the tax code, or more accurately, I'd be furious that such opportunities exist. I don't blame or despise him for taking advantage of those opportunities; nobody wants to pay more in taxes.

I would expect (on the basis of fairness in taxation/tax code provisions) that his liability and tax rate be about what the Clintons was. I mean really, by what measure is it just that a person who, say, earns $2M in a year can minimize their tax liability to $500K (25% effective tax rate) and a person earning $200M should realize a notably lower (20% or less) effective tax rate due to "this and that" so-called "loophole?"

And make no mistake, Trump in in the real estate business; few, if any, other ways of making money offer the tax minimization opportunities that real estate development does. If you happen to own a rental property, you surely know this, even if you don't develop properties on the scale Trump does and thus have access to deductions and exemptions he does. Therein lies the rub. There wouldn't be much cause to be "plucked" about realty's tax minimization opportunities were it not that scale determines whether they are available.

If you are incredulous about or unaware of what I mean, read through the following:

• Ten Tax Loopholes for Active Real Estate Investors | The White Coat Investor - Investing And Personal Finance Information For Physicians, Dentists, Residents, Students, And Other Highly-Educated Busy Professionals
  
• Real Estate Developers: How To Maximize After-Tax Return on Development
  
• Tax Planning for Real Estate Developers
• Basic Tax Considerations for Real Estate Developers
• Tax Planning Opportunities for Real Estate Developers and Investors

The stuff you'll find discussed in the documents above are but a place to start. They are hardly where the opportunities end.

While I can totally understand the outrage, some people make a kind of good point by saying that if businesses/corporations do not get tax breaks, then it could hurt our economy because some of these businesses would just move their operations to another country where it is much cheaper to do business. We need some common sense solutions, such as taxing imports more?

 

[320 Years of History]

Unrelated to the remarks below....The Clintons allowed the U.S. government the use of slightly over $1M of their money in 2015. In other words, they permitted fully 10% of their 2015 income to reside in the government's hands and they collected no interest or other economic value from having done so. Just to offer one illustration of contrast, though I don't earn the kind of money the Clintons do, I am blessed enough to fall into what one might call the "lower ranks" of the 1%. I never get a refund; I don't even aim to get one because I want full use of my money all year long. Instead I typically have to pay ~$500 to $2000K each April 15th.

Say what you want about the Clinton's getting a $1M+ tax refund, but one thing that happenstance says on its own is that extreme tax minimization is not the foremost concern the Clintons have as goes their own money. One million dollars is a material sum to not have use of during the course of a year, even for folks who earn $10M in that year. Frankly, I think the Clintons need a better tax accountant/advisor, but what do I know...I haven't looked at their prior years' returns, maybe 2015 was an anomalous year?

The other observation I've taken from the Clinton's tax return is that aside from their earning more than most folks, they pay taxes commensurate with the amount of income they earn. That is, their tax liability is comparable, from a fairness perspective, to that of most Americans. There's no reason to get bent out of shape over what they pay in taxes and even being able to do so, they don't go out of their way to exploit every so-called loophole they could. They go about their lives, earn what they earn, pay their taxes and that's that.

Exactly. Trump did not write the tax code. Many Congressmen and women use these same deductions and loopholes. They exist and there is nothing illegal about using them to your own advantage. Hillary and Bill used the charitable contribution deduction to write off 96% of their charitable contributions listing those charitable gifts aas going to the Clinton Foundation. It is probably legal.

You are mistaken. The Clintons made no contributions to the Clinton Foundation. Their charitable contributions consisted in 2015 of:

• $42K to Desert Classic Charities
• $1M to the Clinton Family Foundation

While you may not think so, the Clinton Foundation and the Clinton Family Foundation are distinct entities. Although not related to your remarks and FWIW, the Clinton Foundation, despite it's "trade name," is not a private foundation — which typically acts as a pass-through for private donations to other charitable organizations. Rather, it is a public charity. It conducts most of its charitable activities directly.

Additionally, you are also mistaken about the deductibility percentage of their charitable contributions. The Clintons deducted 100% of their charitable contributions because their contributions were below the 50% and 30% deductibility ceilings.

While I can totally understand the outrage, some people make a kind of good point by saying that if businesses/corporations do not get tax breaks, then it could hurt our economy because some of these businesses would just move their operations to another country where it is much cheaper to do business. We need some common sense solutions, such as taxing imports more?

How about merely assigning a a series of graduated rates and merely multiplying the applicable rate to whatever a business reports in its audited financial statements as net income? No deductions; no differences between "book" and "tax" income; no loopholes.

If one wants that rate to be lower than the current stated marginal rate, fine. I'm not wedded to any specific rate; however, seeing as corporations want "personhood" and they have it in many regards, I think they should pay at a rate comparable to what most actual wealthy persons pay. Twenty-five percent to 30% seems reasonable to me, although again, I could live with 20%. What's thoroughly unacceptable to me is that organizations like GE or Verizon, et al have effective tax rates well below 20% as a result of "loopholes."

Red:
Businesses are going to do that anyway if and when it becomes materially more profitable to do so and doing so will improve their competitive position in the marketplace.

As for the tariff idea you suggested, well, that does little but make yours and my goods cost more. Additionally, tariffs reduce business profitability due to the way the incidence of taxes (tariffs in this case) work. If a tariff is high enough that it compromises profitability, the business simply will exist the market (geographic) and enter or focus on others.

​

As you can see from the graphs above, whether the incidence of a tax/tariff falls more heavily on a producer or consumer depends on the slope of the demand curve a given producer experiences for his/her goods or services. That's in a microeconomic sense. Macroeconomically, the principle is the same, but what changes is that it's demand for a whole region or nation's goods/services.

 

[ChrisL]

Unrelated to the remarks below....The Clintons allowed the U.S. government the use of slightly over $1M of their money in 2015. In other words, they permitted fully 10% of their 2015 income to reside in the government's hands and they collected no interest or other economic value from having done so. Just to offer one illustration of contrast, though I don't earn the kind of money the Clintons do, I am blessed enough to fall into what one might call the "lower ranks" of the 1%. I never get a refund; I don't even aim to get one because I want full use of my money all year long. Instead I typically have to pay ~$500 to $2000K each April 15th.

Say what you want about the Clinton's getting a $1M+ tax refund, but one thing that happenstance says on its own is that extreme tax minimization is not the foremost concern the Clintons have as goes their own money. One million dollars is a material sum to not have use of during the course of a year, even for folks who earn $10M in that year. Frankly, I think the Clintons need a better tax accountant/advisor, but what do I know...I haven't looked at their prior years' returns, maybe 2015 was an anomalous year?

The other observation I've taken from the Clinton's tax return is that aside from their earning more than most folks, they pay taxes commensurate with the amount of income they earn. That is, their tax liability is comparable, from a fairness perspective, to that of most Americans. There's no reason to get bent out of shape over what they pay in taxes and even being able to do so, they don't go out of their way to exploit every so-called loophole they could. They go about their lives, earn what they earn, pay their taxes and that's that.

Exactly. Trump did not write the tax code. Many Congressmen and women use these same deductions and loopholes. They exist and there is nothing illegal about using them to your own advantage. Hillary and Bill used the charitable contribution deduction to write off 96% of their charitable contributions listing those charitable gifts aas going to the Clinton Foundation. It is probably legal.

You are mistaken. The Clintons made no contributions to the Clinton Foundation. Their charitable contributions consisted in 2015 of:

• $42K to Desert Classic Charities
• $1M to the Clinton Family Foundation

While you may not think so, the Clinton Foundation and the Clinton Family Foundation are distinct entities. Although not related to your remarks and FWIW, the Clinton Foundation, despite it's "trade name," is not a private foundation — which typically acts as a pass-through for private donations to other charitable organizations. Rather, it is a public charity. It conducts most of its charitable activities directly.

Additionally, you are also mistaken about the deductibility percentage of their charitable contributions. The Clintons deducted 100% of their charitable contributions because their contributions were below the 50% and 30% deductibility ceilings.

While I can totally understand the outrage, some people make a kind of good point by saying that if businesses/corporations do not get tax breaks, then it could hurt our economy because some of these businesses would just move their operations to another country where it is much cheaper to do business. We need some common sense solutions, such as taxing imports more?

How about merely assigning a a series of graduated rates and merely multiplying the applicable rate to whatever a business reports in its audited financial statements as net income? No deductions; no differences between "book" and "tax" income; no loopholes.

If one wants that rate to be lower than the current stated marginal rate, fine. I'm not wedded to any specific rate; however, seeing as corporations want "personhood" and they have it in many regards, I think they should pay at a rate comparable to what most actual wealthy persons pay. Twenty-five percent to 30% seems reasonable to me, although again, I could live with 20%. What's thoroughly unacceptable to me is that organizations like GE or Verizon, et al have effective tax rates well below 20% as a result of "loopholes."

Red:
Businesses are going to do that anyway if and when it becomes materially more profitable to do so and doing so will improve their competitive position in the marketplace.

As for the tariff idea you suggested, well, that does little but make yours and my goods cost more. Additionally, tariffs reduce business profitability due to the way the incidence of taxes (tariffs in this case) work. If a tariff is high enough that it compromises profitability, the business simply will exist the market (geographic) and enter or focus on others.

​

As you can see from the graphs above, whether the incidence of a tax/tariff falls more heavily on a producer or consumer depends on the slope of the demand curve a given producer experiences for his/her goods or services. That's in a microeconomic sense. Macroeconomically, the principle is the same, but what changes is that it's demand for a whole region or nation's goods/services.

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

 

[320 Years of History]

Unrelated to the remarks below....The Clintons allowed the U.S. government the use of slightly over $1M of their money in 2015. In other words, they permitted fully 10% of their 2015 income to reside in the government's hands and they collected no interest or other economic value from having done so. Just to offer one illustration of contrast, though I don't earn the kind of money the Clintons do, I am blessed enough to fall into what one might call the "lower ranks" of the 1%. I never get a refund; I don't even aim to get one because I want full use of my money all year long. Instead I typically have to pay ~$500 to $2000K each April 15th.

Say what you want about the Clinton's getting a $1M+ tax refund, but one thing that happenstance says on its own is that extreme tax minimization is not the foremost concern the Clintons have as goes their own money. One million dollars is a material sum to not have use of during the course of a year, even for folks who earn $10M in that year. Frankly, I think the Clintons need a better tax accountant/advisor, but what do I know...I haven't looked at their prior years' returns, maybe 2015 was an anomalous year?

The other observation I've taken from the Clinton's tax return is that aside from their earning more than most folks, they pay taxes commensurate with the amount of income they earn. That is, their tax liability is comparable, from a fairness perspective, to that of most Americans. There's no reason to get bent out of shape over what they pay in taxes and even being able to do so, they don't go out of their way to exploit every so-called loophole they could. They go about their lives, earn what they earn, pay their taxes and that's that.

Exactly. Trump did not write the tax code. Many Congressmen and women use these same deductions and loopholes. They exist and there is nothing illegal about using them to your own advantage. Hillary and Bill used the charitable contribution deduction to write off 96% of their charitable contributions listing those charitable gifts aas going to the Clinton Foundation. It is probably legal.

You are mistaken. The Clintons made no contributions to the Clinton Foundation. Their charitable contributions consisted in 2015 of:

• $42K to Desert Classic Charities
• $1M to the Clinton Family Foundation

While you may not think so, the Clinton Foundation and the Clinton Family Foundation are distinct entities. Although not related to your remarks and FWIW, the Clinton Foundation, despite it's "trade name," is not a private foundation — which typically acts as a pass-through for private donations to other charitable organizations. Rather, it is a public charity. It conducts most of its charitable activities directly.

Additionally, you are also mistaken about the deductibility percentage of their charitable contributions. The Clintons deducted 100% of their charitable contributions because their contributions were below the 50% and 30% deductibility ceilings.

While I can totally understand the outrage, some people make a kind of good point by saying that if businesses/corporations do not get tax breaks, then it could hurt our economy because some of these businesses would just move their operations to another country where it is much cheaper to do business. We need some common sense solutions, such as taxing imports more?

How about merely assigning a a series of graduated rates and merely multiplying the applicable rate to whatever a business reports in its audited financial statements as net income? No deductions; no differences between "book" and "tax" income; no loopholes.

If one wants that rate to be lower than the current stated marginal rate, fine. I'm not wedded to any specific rate; however, seeing as corporations want "personhood" and they have it in many regards, I think they should pay at a rate comparable to what most actual wealthy persons pay. Twenty-five percent to 30% seems reasonable to me, although again, I could live with 20%. What's thoroughly unacceptable to me is that organizations like GE or Verizon, et al have effective tax rates well below 20% as a result of "loopholes."

Red:
Businesses are going to do that anyway if and when it becomes materially more profitable to do so and doing so will improve their competitive position in the marketplace.

As for the tariff idea you suggested, well, that does little but make yours and my goods cost more. Additionally, tariffs reduce business profitability due to the way the incidence of taxes (tariffs in this case) work. If a tariff is high enough that it compromises profitability, the business simply will exist the market (geographic) and enter or focus on others.

​

As you can see from the graphs above, whether the incidence of a tax/tariff falls more heavily on a producer or consumer depends on the slope of the demand curve a given producer experiences for his/her goods or services. That's in a microeconomic sense. Macroeconomically, the principle is the same, but what changes is that it's demand for a whole region or nation's goods/services.

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Whether businesses will move elsewhere depends on many factors, not just business income tax rates. In a tariff free environment, income taxes pay a more significant role. In an environment having tariffs, the matter becomes considerably more complex. The short of it is that tariffs require businesses to:

• assess their potential and actual profitability in the locality having the tariff vs. that in one or more localities that do not.
• assess the impact of income and other taxes (not including the tariff "tax" itself) in the various localities,
• assess whether there are viable means to alter the slope of their individual demand curve so they can either (1) avoid some or all of the tariff or (2) pass on to customers more rather than less of the burden of a tariff, while still achieving the desired profitability for the business.
• assess whether the desired profitability can be achieved with and/or without the burden of tariffs and the other various taxes.
• assess whether non-tariff taxes or other taxes (and fees) comprise the larger burden on the business.
• assess whether that desired profitability can be achieved more easily elsewhere.
• assess whether, given the business owner's various non-profit-specific goals, it is worth it to remain content with "desired" profit, seek "greater than desired profit (increase the profit desired)" or be content with "less than desired profit (lower the profit desired).
• assess the non-tax/non-tariff related business environment (regulatory environment, political environment, ethical landscape, legal environment, competition, consumer base and growth opportunities, etc.)

The preceding is just a high level synopsis of the general types of factors that a business manager must explore. It's easy to note those things and the several others that play into the decision. Actually performing the analysis takes considerable skill, time and information.

Far better and less administratively dear is to simply do business in locales that have no tariff. In such places, yes, the role of income and other taxes and governmentally mandated fees features more prominently in the analysis of where to conduct business. Sure, more than just tariffs and taxes play into the picture, but in a situation where "today" there is no tariff and the tax rate allows a business to earn its desired profitability and "tomorrow" there will be a tariff, the thing the business has the most control over whether it does or does not subject itself to is the tariff.

Thus the point of the above and the didactic remarks in the prior post is, yes, costs do motivate a business to make "stay or go" decisions, but alone, the existing tax rates remaining as they are is not going to inspire business managers to undertake analysis leading to making that decision. Adding a tariff while keeping other tax rates constant may very well do do.

What does that mean with regard to the suggestion I offered in my prior post and with regard to the marginal tax rates businesses experience today? It means that were the suggestion I offered implemented, the marginal tax rate would need to be lower than it is today, but not so much lower that companies are inspired to cease to be U.S. companies. The factors described broadly in the last bullet point above have very powerful sway in determining whether a firm will opt to do business in X-locale or not do business there. For example, but not limited to this example, nobody wants to own business assets in a place that may nationalize the industry in which one does business. The same is so of places where graft, and social connections and other non-economic/unempirical factors play a larger (rather than smaller) role in one's thriving than does the merit of one's business strategy and tactics, and one's adroitness at implementing them.

The current marginal corporate income tax rate is 39.5%, of which 35% is federal. Few if any companies pay the marginal rate. That is why I suggested I'd be amendable, using the far simpler method of tax liability calculation I proposed, to a rate between 20% and 30%.

 

[ChrisL]

Unrelated to the remarks below....The Clintons allowed the U.S. government the use of slightly over $1M of their money in 2015. In other words, they permitted fully 10% of their 2015 income to reside in the government's hands and they collected no interest or other economic value from having done so. Just to offer one illustration of contrast, though I don't earn the kind of money the Clintons do, I am blessed enough to fall into what one might call the "lower ranks" of the 1%. I never get a refund; I don't even aim to get one because I want full use of my money all year long. Instead I typically have to pay ~$500 to $2000K each April 15th.

Say what you want about the Clinton's getting a $1M+ tax refund, but one thing that happenstance says on its own is that extreme tax minimization is not the foremost concern the Clintons have as goes their own money. One million dollars is a material sum to not have use of during the course of a year, even for folks who earn $10M in that year. Frankly, I think the Clintons need a better tax accountant/advisor, but what do I know...I haven't looked at their prior years' returns, maybe 2015 was an anomalous year?

The other observation I've taken from the Clinton's tax return is that aside from their earning more than most folks, they pay taxes commensurate with the amount of income they earn. That is, their tax liability is comparable, from a fairness perspective, to that of most Americans. There's no reason to get bent out of shape over what they pay in taxes and even being able to do so, they don't go out of their way to exploit every so-called loophole they could. They go about their lives, earn what they earn, pay their taxes and that's that.

Exactly. Trump did not write the tax code. Many Congressmen and women use these same deductions and loopholes. They exist and there is nothing illegal about using them to your own advantage. Hillary and Bill used the charitable contribution deduction to write off 96% of their charitable contributions listing those charitable gifts aas going to the Clinton Foundation. It is probably legal.

You are mistaken. The Clintons made no contributions to the Clinton Foundation. Their charitable contributions consisted in 2015 of:

• $42K to Desert Classic Charities
• $1M to the Clinton Family Foundation

While you may not think so, the Clinton Foundation and the Clinton Family Foundation are distinct entities. Although not related to your remarks and FWIW, the Clinton Foundation, despite it's "trade name," is not a private foundation — which typically acts as a pass-through for private donations to other charitable organizations. Rather, it is a public charity. It conducts most of its charitable activities directly.

Additionally, you are also mistaken about the deductibility percentage of their charitable contributions. The Clintons deducted 100% of their charitable contributions because their contributions were below the 50% and 30% deductibility ceilings.

While I can totally understand the outrage, some people make a kind of good point by saying that if businesses/corporations do not get tax breaks, then it could hurt our economy because some of these businesses would just move their operations to another country where it is much cheaper to do business. We need some common sense solutions, such as taxing imports more?

How about merely assigning a a series of graduated rates and merely multiplying the applicable rate to whatever a business reports in its audited financial statements as net income? No deductions; no differences between "book" and "tax" income; no loopholes.

If one wants that rate to be lower than the current stated marginal rate, fine. I'm not wedded to any specific rate; however, seeing as corporations want "personhood" and they have it in many regards, I think they should pay at a rate comparable to what most actual wealthy persons pay. Twenty-five percent to 30% seems reasonable to me, although again, I could live with 20%. What's thoroughly unacceptable to me is that organizations like GE or Verizon, et al have effective tax rates well below 20% as a result of "loopholes."

Red:
Businesses are going to do that anyway if and when it becomes materially more profitable to do so and doing so will improve their competitive position in the marketplace.

As for the tariff idea you suggested, well, that does little but make yours and my goods cost more. Additionally, tariffs reduce business profitability due to the way the incidence of taxes (tariffs in this case) work. If a tariff is high enough that it compromises profitability, the business simply will exist the market (geographic) and enter or focus on others.

​

As you can see from the graphs above, whether the incidence of a tax/tariff falls more heavily on a producer or consumer depends on the slope of the demand curve a given producer experiences for his/her goods or services. That's in a microeconomic sense. Macroeconomically, the principle is the same, but what changes is that it's demand for a whole region or nation's goods/services.

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Whether businesses will move elsewhere depends on many factors, not just business income tax rates. In a tariff free environment, income taxes pay a more significant role. In an environment having tariffs, the matter becomes considerably more complex. The short of it is that tariffs require businesses to:

• assess their potential and actual profitability in the locality having the tariff vs. that in one or more localities that do not.
• assess the impact of income and other taxes (not including the tariff "tax" itself) in the various localities,
• assess whether there are viable means to alter the slope of their individual demand curve so they can either (1) avoid some or all of the tariff or (2) pass on to customers more rather than less of the burden of a tariff, while still achieving the desired profitability for the business.
• assess whether the desired profitability can be achieved with and/or without the burden of tariffs and the other various taxes.
• assess whether non-tariff taxes or other taxes (and fees) comprise the larger burden on the business.
• assess whether that desired profitability can be achieved more easily elsewhere.
• assess whether, given the business owner's various non-profit-specific goals, it is worth it to remain content with "desired" profit, seek "greater than desired profit (increase the profit desired)" or be content with "less than desired profit (lower the profit desired).
• assess the non-tax/non-tariff related business environment (regulatory environment, political environment, ethical landscape, legal environment, competition, consumer base and growth opportunities, etc.)

The preceding is just a high level synopsis of the general types of factors that a business manager must explore. It's easy to note those things and the several others that play into the decision. Actually performing the analysis takes considerable skill, time and information.

Far better and less administratively dear is to simply do business in locales that have no tariff. In such places, yes, the role of income and other taxes and governmentally mandated fees features more prominently in the analysis of where to conduct business. Sure, more than just tariffs and taxes play into the picture, but in a situation where "today" there is no tariff and the tax rate allows a business to earn its desired profitability and "tomorrow" there will be a tariff, the thing the business has the most control over whether it does or does not subject itself to is the tariff.

Thus the point of the above and the didactic remarks in the prior post is, yes, costs do motivate a business to make "stay or go" decisions, but alone, the existing tax rates remaining as they are is not going to inspire business managers to undertake analysis leading to making that decision. Adding a tariff while keeping other tax rates constant may very well do do.

What does that mean with regard to the suggestion I offered in my prior post and with regard to the marginal tax rates businesses experience today? It means that were the suggestion I offered implemented, the marginal tax rate would need to be lower than it is today, but not so much lower that companies are inspired to cease to be U.S. companies. The factors described broadly in the last bullet point above have very powerful sway in determining whether a firm will opt to do business in X-locale or not do business there. For example, but not limited to this example, nobody wants to own business assets in a place that may nationalize the industry in which one does business. The same is so of places where graft, and social connections and other non-economic/unempirical factors play a larger (rather than smaller) role in one's thriving than does the merit of one's business strategy and tactics, and one's adroitness at implementing them.

The current marginal corporate income tax rate is 39.5%, of which 35% is federal. Few if any companies pay the marginal rate. That is why I suggested I'd be amendable, using the far simpler method of tax liability calculation I proposed, to a rate between 20% and 30%.

I do agree with you and would like nothing more than to close the loopholes and end the corporotacracy which I am completely against. BUT, the fact does remain that if we make it too complicated and expensive, more businesses are going to move, or those big businesses that can just pack up and go to another country. That is why I go with the idea of tariffs on imports. That way it's not so cheap for them to just pack up and go to another country because I imagine that we are where they are going to make the most money.

 

[yiostheoy]

Unrelated to the remarks below....The Clintons allowed the U.S. government the use of slightly over $1M of their money in 2015. In other words, they permitted fully 10% of their 2015 income to reside in the government's hands and they collected no interest or other economic value from having done so. Just to offer one illustration of contrast, though I don't earn the kind of money the Clintons do, I am blessed enough to fall into what one might call the "lower ranks" of the 1%. I never get a refund; I don't even aim to get one because I want full use of my money all year long. Instead I typically have to pay ~$500 to $2000K each April 15th.

Say what you want about the Clinton's getting a $1M+ tax refund, but one thing that happenstance says on its own is that extreme tax minimization is not the foremost concern the Clintons have as goes their own money. One million dollars is a material sum to not have use of during the course of a year, even for folks who earn $10M in that year. Frankly, I think the Clintons need a better tax accountant/advisor, but what do I know...I haven't looked at their prior years' returns, maybe 2015 was an anomalous year?

The other observation I've taken from the Clinton's tax return is that aside from their earning more than most folks, they pay taxes commensurate with the amount of income they earn. That is, their tax liability is comparable, from a fairness perspective, to that of most Americans. There's no reason to get bent out of shape over what they pay in taxes and even being able to do so, they don't go out of their way to exploit every so-called loophole they could. They go about their lives, earn what they earn, pay their taxes and that's that.

Exactly. Trump did not write the tax code. Many Congressmen and women use these same deductions and loopholes. They exist and there is nothing illegal about using them to your own advantage. Hillary and Bill used the charitable contribution deduction to write off 96% of their charitable contributions listing those charitable gifts aas going to the Clinton Foundation. It is probably legal.

You are mistaken. The Clintons made no contributions to the Clinton Foundation. Their charitable contributions consisted in 2015 of:

• $42K to Desert Classic Charities
• $1M to the Clinton Family Foundation

While you may not think so, the Clinton Foundation and the Clinton Family Foundation are distinct entities. Although not related to your remarks and FWIW, the Clinton Foundation, despite it's "trade name," is not a private foundation — which typically acts as a pass-through for private donations to other charitable organizations. Rather, it is a public charity. It conducts most of its charitable activities directly.

Additionally, you are also mistaken about the deductibility percentage of their charitable contributions. The Clintons deducted 100% of their charitable contributions because their contributions were below the 50% and 30% deductibility ceilings.

While I can totally understand the outrage, some people make a kind of good point by saying that if businesses/corporations do not get tax breaks, then it could hurt our economy because some of these businesses would just move their operations to another country where it is much cheaper to do business. We need some common sense solutions, such as taxing imports more?

How about merely assigning a a series of graduated rates and merely multiplying the applicable rate to whatever a business reports in its audited financial statements as net income? No deductions; no differences between "book" and "tax" income; no loopholes.

If one wants that rate to be lower than the current stated marginal rate, fine. I'm not wedded to any specific rate; however, seeing as corporations want "personhood" and they have it in many regards, I think they should pay at a rate comparable to what most actual wealthy persons pay. Twenty-five percent to 30% seems reasonable to me, although again, I could live with 20%. What's thoroughly unacceptable to me is that organizations like GE or Verizon, et al have effective tax rates well below 20% as a result of "loopholes."

Red:
Businesses are going to do that anyway if and when it becomes materially more profitable to do so and doing so will improve their competitive position in the marketplace.

As for the tariff idea you suggested, well, that does little but make yours and my goods cost more. Additionally, tariffs reduce business profitability due to the way the incidence of taxes (tariffs in this case) work. If a tariff is high enough that it compromises profitability, the business simply will exist the market (geographic) and enter or focus on others.

​

As you can see from the graphs above, whether the incidence of a tax/tariff falls more heavily on a producer or consumer depends on the slope of the demand curve a given producer experiences for his/her goods or services. That's in a microeconomic sense. Macroeconomically, the principle is the same, but what changes is that it's demand for a whole region or nation's goods/services.

Micro Econ in college and grad school was so much fun I can barely live without it.

Everything basically boils down to monopolistic competition -- the producer has got you by the balls -- such as with petroleum products or electric power or installed software (Oracle, Microsoft, SAP, etc.).

If they've got you by the balls then your hearts and minds will soon follow. And then they can suck your blood dry.

 

[yiostheoy]

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

 

[ChrisL]

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

 

[yiostheoy]

Do I care about Donald Duck Trump's tax returns?

Not at all.

It's just one more nail in his coffin -- same as it was for the robber baron Romney.

 

[yiostheoy]

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

Make their execs and employees ALL move -- then they can't do it. Because somebody has to stay.

If somebody is here then the business can be taxed here -- all of it can be taxes here.

That's what the Chinese and the Indians do too.

Hillary is already talking about a tax plan for corporations like that.

Donald on the other hand does not have a clue.

 

[ChrisL]

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

Make their execs and employees ALL move -- then they can't do it. Because somebody has to stay.

If somebody is here then the business can be taxed here -- all of it can be taxes here.

That's what the Chinese and the Indians do too.

Hillary is already talking about a tax plan for corporations like that.

Donald on the other hand does not have a clue.

They can't make them all move. Realistic solutions please.

And why not tax their imports if they do move? I haven't heard a good reason to be against doing that.

 

[yiostheoy]

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

Make their execs and employees ALL move -- then they can't do it. Because somebody has to stay.

If somebody is here then the business can be taxed here -- all of it can be taxes here.

That's what the Chinese and the Indians do too.

Hillary is already talking about a tax plan for corporations like that.

Donald on the other hand does not have a clue.

They can't make them all move. Realistic solutions please.

And why not tax their imports if they do move? I haven't heard a good reason to be against doing that.

I listened to Hillary's convention speech like everyone else and it sounds like she is working on this problem.

Trump is oblivious to this problem.

Trump is simply another Robber Baron Romney in disguise.

 

[ChrisL]

Well, as long as you realize that taxing businesses more will cause more businesses to move elsewhere. We end up being the losers.

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

Make their execs and employees ALL move -- then they can't do it. Because somebody has to stay.

If somebody is here then the business can be taxed here -- all of it can be taxes here.

That's what the Chinese and the Indians do too.

Hillary is already talking about a tax plan for corporations like that.

Donald on the other hand does not have a clue.

They can't make them all move. Realistic solutions please.

And why not tax their imports if they do move? I haven't heard a good reason to be against doing that.

I listened to Hillary's convention speech like everyone else and it sounds like she is working on this problem.

Trump is oblivious to this problem.

Trump is simply another Robber Baron Romney in disguise.

What gives you the idea that I would vote for Trump? You are preaching to the choir.

 

[yiostheoy]

The only way for Company A to completely escape taxation in Country Z is to move everything lock stock and barrel OUT of Country Z.

Otherwise if anything from the company is left within Country Z, then Country Z can tax them any way they want as long as their tax laws apply to every company in Country Z.

I don't want to debate and explain the entire US Tax Code to you so please spare me.

 

[yiostheoy]

Apple & Microsoft & Intel and similar mega companies that use the IRS regs to show a low corporate taxable income in the USA while shifting mega profits offshore and letting the money languish in foreign bank accounts OUGHT to be taxed MORE.

And if they MOVE like Haliburton did then FOKK them. Let them move.

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

Make their execs and employees ALL move -- then they can't do it. Because somebody has to stay.

If somebody is here then the business can be taxed here -- all of it can be taxes here.

That's what the Chinese and the Indians do too.

Hillary is already talking about a tax plan for corporations like that.

Donald on the other hand does not have a clue.

They can't make them all move. Realistic solutions please.

And why not tax their imports if they do move? I haven't heard a good reason to be against doing that.

I listened to Hillary's convention speech like everyone else and it sounds like she is working on this problem.

Trump is oblivious to this problem.

Trump is simply another Robber Baron Romney in disguise.

What gives you the idea that I would vote for Trump? You are preaching to the choir.

Trump is the only relevant political issue in this discussion.

It does not matter whom you yourself intend to vote for.

I was not targeting you nor your vote.

Don't get prissy.

 

[ChrisL]

Yes, but tax their imports over here. If they want to close businesses here and open them "over there" (wherever that may be), then they should have to pay more to import their products here to sell, IMO. That only makes sense to me.

Make their execs and employees ALL move -- then they can't do it. Because somebody has to stay.

If somebody is here then the business can be taxed here -- all of it can be taxes here.

That's what the Chinese and the Indians do too.

Hillary is already talking about a tax plan for corporations like that.

Donald on the other hand does not have a clue.

They can't make them all move. Realistic solutions please.

And why not tax their imports if they do move? I haven't heard a good reason to be against doing that.

I listened to Hillary's convention speech like everyone else and it sounds like she is working on this problem.

Trump is oblivious to this problem.

Trump is simply another Robber Baron Romney in disguise.

What gives you the idea that I would vote for Trump? You are preaching to the choir.

Trump is the only relevant political issue in this discussion.

It does not matter whom you yourself intend to vote for.

I was not targeting you nor your vote.

Don't get prissy.

Your posts were addressed to ME, Einstein. And don't tell me what to do.

Edit: Oops, I promised I would be good, so I won't say that part.