Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Lizzie Tudor who wrote (514500)	12/22/2003 2:19:07 PM
From: Oeconomicus	Read Replies (2) \| Respond to of 769670

When I made hundreds of thousands in capital gains in the 90s doing nothing more than talking to my buddies about what was going on, that "passive income" was not taxed at high rates, ever. The listed companies and their EARNINGS are taxed at some smaller proportion to earned rates... Dizzy, add tax law to your remedial study list. "Passive income" in the context of personal income taxes NEVER includes capital gains from securities investments and it definitely DOES NOT get favorable tax treatment. Passive income refers to the taxpayer's share of business income and losses from a business in which they do not materially participate. This is generally reported to you on a form K-1 (from a partnership, S-corp, etc.) and, BTW, would NOT come from ownership of shares of a "listed company" unless you happen to know of one that is structured as a pass-through entity. And passive income, in fact, gets UNfavorable tax treatment because you can't deduct passive losses except against passive income (and even then, you may have AMT issues). Beyond that, it is taxed as ordinary income to you - just like "active" business income if your business is profitable. I paid no FICA on my income, my employees were socked with that. Some of my money was "long term" at which point it received the lower rate. Capital gains are a travesty, a sham. So, you now want to eliminate the preferential treatment of long-term cap gains? AND hit them with FICA deductions to boot? LOL. Why don't you just advocate confiscation of all wealth to be held and redistributed at the whim of your favorite politician? Anyway, please get yourself some remedial education in taxes - your economic ignorance was bad enough.

To: Lizzie Tudor who wrote (514500)	12/22/2003 3:52:43 PM
From: tonto	Read Replies (1) \| Respond to of 769670

Lizzie, the money you invested was earned at one time am I not correct? If so, as is the case for most wage earners, it is taxed at the different income levels. That money then can be reinvested and taxed again and again, but at lower rates. Yes, capital gains are taxed at lower rates as they should be, that money has already been taxed enough. Unless one is simply interested in taking away one person's property. Then it can be argued that the person with more is not having enough of their property taken away from them at once. Why are taxes on capital gains a sham as you write? If they were taxed higher will they become an honest earning? We differ in opinions. How could you have employees and no personal earned income? You have got to be kidding. When I made hundreds of thousands in capital gains in the 90s doing nothing more than talking to my buddies about what was going on, that "passive income" was not taxed at high rates, ever. The listed companies and their EARNINGS are taxed at some smaller proportion to earned rates (much smaller actually given all the loopholes which Fica does not allow for)- but as an investor I was just speculating like everybody else. I paid less taxes on 500K of income than my employees paid on their 60K salaries, that is a fact. I paid no FICA on my income, my employees were socked with that. Some of my money was "long term" at which point it received the lower rate. Capital gains are a travesty, a sham.

To: Lizzie Tudor who wrote (514500)	12/22/2003 7:54:43 PM
From: Cooters	Respond to of 769670

Capital gains are a travesty, a sham Capital gains, also defined as the creation of wealth, are a sham? The creation of wealth is a sham? Well it is nice to see you take issue with the creation of wealth, the core tenet of capitalism. Socialism, along with deviant forms like communism and fascism, is dead. Shuffling wealth does not work, price controls do not work, the Emperor Has No Clothes! What is required for that to sink in? How many times does the coin need to come up heads? Cooters

To: Lizzie Tudor who wrote (514500)	12/22/2003 10:22:15 PM
From: Amy J	Read Replies (2) \| Respond to of 769670

Hi Lizzie, RE: "I paid less taxes on 500K of income than my employees paid on their 60K salaries, that is a fact." Many people risked and lost multiples of 500k in 2000 alone - hard earned money. Meanwhile, your salaried paycheck is guaranteed by law (it's a federal violation not to run payroll for employees' work performed.) ( There's a high risk for losses associated with capital. Gains are not guaranteed. Investors take on huge risks to grow America's businesses and investors are needed. This is why capital is taxed less. The investment capital tax rate is fine - investments are significantly more risky than wages earned. Dividends don't have risk associated with stock capital, so they probably should be taxed more, in my opinion.) The critical issue is with the income tax deductibles, that yields a 60k employee paying more than a salaried 250k CEO. As in the case here of startups here. And this is purely due to excessive deductions on personal tax forms. The real issue here (with why a CEO pays less tax than a 60k employee) is with the deductibles on income earned that reduces a tax bill to almost nothing. CEOs are more sophisticated with financial strategies such as deductions, resulting in (what is perceived here) the scrappy 60k Gen Y and Gen X subsidizing wealthy 250k Baby Boomers. It's a serious generational gap tax issue here. Gen Ys and those Gen X's that make 60k, tend to get really ticked when they learn about how they are footing the tax bill (actually paying more tax than a CEO) for CEO's who are earning 4X's more than them. Said another way, there's a perception with many Gen X and Gen Y here, that the 250k salaried Boomer is not paying their fair share of salary taxes, are essentially getting paid by the government to carry irresponsibly high levels of debt that they will burden the younger generation with, all the while they are draining social security funds, and the evidence being when you see a 250k CEO paying less taxes on his or her salary than a 60k Gen Y's salary. There's a general belief that there won't be too much left other than debt for the Gen X & Gen Ys. And never mind the property tax law that encourages Boomers to buy more than one house here in the Bay Area (because the tax law subsidizes this), and thus they consume more homes, resulting in higher house costs for Gen Ys due to a housing shortage. Demographically speaking, I read (and have been also told by a Gen Y) Gen Ys apparently think kindness is a weakness and they are a larger group than the Boomers. So one may not want to bet on the tax laws being sympathetic for us Gen Xers when they eventually take over the laws. Translated, Gen X's are going to get the financial squeeze and get caught right in the middle of the Gen Y and Boomer tug of war: Gen Xers will pay into a system but not get anything out of it because the Gen Ys will put an end to this all. Call the Gen Ys the Baby Busters. I'm not sure either extreme measures are good. Regards, Amy J

To: Lizzie Tudor who wrote (514500)	1/16/2004 1:31:33 PM
From: Lazarus_Long	Respond to of 769670

I paid less taxes on 500K of income than my employees paid on their 60K salaries Dear Dizzy, My wife has 20 years experience as an IRS auditor and revenue agent. She is unaware of how to legally achieve the results you got. She is MOST interested in knowing this as it should aid enormously in attracting clients. Please reply by PM as the information will be of little use if widely known. Laz

To: Lizzie Tudor who wrote (514500)	1/21/2004 9:21:13 PM
From: Lazarus_Long	Respond to of 769670

Madam, Regarding I paid less taxes on 500K of income than my employees paid on their 60K salaries, that is a fact. I paid no FICA on my income, my employees were socked with that. You claim to have previously been a manager at a tech company in the valley. That implies either an employee or an independent contractor, almost certainly an employee. My wife has two decades experience as an IRS auditor and revenue agent. She informs me that there is NO WAY you could legally accomplish what you claim. Would you please PM me your real name and address? We wish to report you to IRS for the informer's fee.