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Politics : American Presidential Politics and foreign affairs -- Ignore unavailable to you. Want to Upgrade?

To: DuckTapeSunroof who wrote (48777)	11/27/2011 3:02:59 PM
From: tonto	1 Recommendation Read Replies (1) \| Respond to of 71588

There are caps which are very low on long term capital losses. They would do very little for Buffet.

To: DuckTapeSunroof who wrote (48777)	12/2/2011 9:35:00 PM
From: TimF	Read Replies (1) \| Respond to of 71588

nearly all of which is of course derived from dividends and long and short-term capital gains The rate on such income are 15% and the ordinary income tax rate (for Buffet 35%). Her statutory tax rate is likely less than 35% (and if its not she is "top 1%", hardly what most people think of when they think of secretaries, also if its not the statutory tax rate on most of her income would be lower even if the marginal tax rate is not). The effective tax rate is reasonably likely to be under 15% (but if there is no mortgage or other large tax breaks involved, it might not be, we would really have to see the tax return to be sure) and all offset by healthy dollops of accrued realized capital losses which can carry-forward an unlimited amount of time Which don't lower his tax burden below the statutory rate, they just keep it (for this part of his income, and ignoring other tax breaks which would be a separate argument) at the statutory rate. If your gains are offset be losses then you gained less, and have less income to tax. If he pays less its likely that its because of charitable contributions and/or money invested in tax free or tax differed instruments. If its tax differed then the taxes will just be paid later. If its tax free municipal bonds, or tax breaks for charitable contributions, well you can debate the pros or cons of such parts of the tax code if you want, I might even agree with you, but its a stretch to say the wealthy aren't paying "their share" because they contribute to charity. As for the bonds the tax advantage on them is more of benefit to the bond issuers than to the bond holders. The bond holder gets lower interest in lieu of paying taxes. Also he ignores the tax paid by his assets. He owns all or parts of corporations that pay taxes, but doesn't count his share of that cost when he claims he pays less.