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- geojanes
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28 Oct 2014, 11:25 am
Freeman, I completely believe it. If you have the wherewithal to own a billion dollar sports franchise you have the wherewithal to make sure it's worth your while.
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.
It's their constitutional right, for goodness sake! And can we blame them for doing a really good job of petitioning their Government? No, we should blame ourselves for not being able to petition our Government better.
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- rickyp
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28 Oct 2014, 1:41 pm
geo
It's their constitutional right, for goodness sake! And can we blame them for doing a really good job of petitioning their Government? No, we should blame ourselves for not being able to petition our Government better.
This is not an even contest though is it Geo?
When money is so important in politics, where half an elected officials time is spent raising money for re-election, the wealthy have a huge edge. And corporations, who are people too apparently, even bigger...
If you managed to take money out of politics some how, perhaps by publicly funding all elections, then the petitioners would be on a equal footing.
For now, what is presented as "capitalism" is not. Its a system where risk is publicly backstopped and funded, but the rewards for success go to a few and do not return in any way to those who accepted the risk.
This is a perversion of capitalism.
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- danivon
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28 Oct 2014, 3:24 pm
bbauska wrote:Just another reason that everyone should have the same tax standards...
Let's just start with those who have billions of dollars having the same standards as the middle class. We can soak the poor later...
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- bbauska
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28 Oct 2014, 5:28 pm
danivon wrote:bbauska wrote:Just another reason that everyone should have the same tax standards...
Let's just start with those who have billions of dollars having the same standards as the middle class. We can soak the poor later...
Do you think your sarcasm really helps?
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- bbauska
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28 Oct 2014, 5:32 pm
By the by... I do not think the rich should have any more tax breaks than the poor. These benefits for sports teams really show the ability of the system to be gamed.
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- danivon
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29 Oct 2014, 1:11 am
bbauska wrote:danivon wrote:bbauska wrote:Just another reason that everyone should have the same tax standards...
Let's just start with those who have billions of dollars having the same standards as the middle class. We can soak the poor later...
Do you think your sarcasm really helps?
It's not really sarcasm. It's about prioritising those who get a break based on whether they can afford it or not.
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- Ray Jay
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29 Oct 2014, 7:54 am
About 12 years ago I was involved in the purchase of a major league sports franchise. The mechanics are that the individual is buying the team's assets. As such, under US tax law, the purchase price is allocated to the assets that are purchased. In the typical situation you allocate the purchase price to A/R, inventory, real estate, equipment, etc. However, one can make the case that the most important asset of any sports' team is the player contracts. (On audit, the IRS will make the case that it is the intangibles, which you can not deduct.) So, you pay $100 million and you buy essentially 10 to 20 player contracts that are collectively worth about $80 million. You then amortize those contracts over their remaining lives which are often very short. As a result, you get to deduct that $80 million over the next 2 to 4 years, on average. It's a nice deduction if you can get it.
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- geojanes
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16 Nov 2014, 1:31 pm
Berkshire buys Duracell:
http://www.businessweek.com/news/2014-11-13/buffett-seen-saving-more-than-1-billion-on-taxes-in-swapBerkshire announced today that it would turn over about $4.7 billion in Procter & Gamble Co. (PG:US) stock in exchange for P&G’s Duracell battery business, which will be infused with about $1.7 billion in cash.
Since Buffett’s cost basis on the shares was about $336 million, and corporate capital gains are typically taxed at 35 percent, structuring the deal in this way could save Berkshire more than $1 billion [in taxes]. P&G also stands to reduce its tax liability on the sale.
It's the third time Buffet has done a deal like this over the past year or so. Each time he's using appreciated stock in the target company as currency to buy a bit of that company and thereby avoid paying capital gains taxes. Also, since no one else has $4.4 bil of unrealized capital gains in P&G stock laying around, it's not like anyone else could compete with him on the deal. The guy is brilliant.
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- Sassenach
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21 Nov 2014, 1:51 pm
On the subject of US taxes, this story caught my eye recently:
http://www.theguardian.com/politics/201 ... s-tax-billBoris Johnson has revealed that he is refusing to pay a tax demand issued to him by US authorities – despite previously lambasting the US embassy in London over its failure to pay the congestion charge.
The mayor of London, who was born in New York and holds a US passport as well as a British one, visited the country last week to promote his book and said during an interview with NPR (National Public Radio) that he had been hit with a demand for capital gains tax.
He said the US demand related to his first home in the UK, which was not subject to capital gains tax in England.
All US citizens, including those with dual citizenship, are legally obliged to file a tax return and liable to pay US taxes, wherever they are living, even if the income is earned abroad.
Asked whether he would pay the bill, Johnson initially avoided the question. But when it was put to him a second time, he replied: “No is the answer. I think it’s absolutely outrageous. Why should I? I think, you know, I’m not a … I, you know, I haven’t lived in the United States for, you know, well, since I was five years old … I pay the lion’s share of my tax, I pay my taxes to the full in the United Kingdom where I live and work.”
It's hard to disagree with him really. I wasn't aware that simply being born in the US makes you liable for federal taxes no matter where you grew up, where you work and where you make your money. Boris Johnson is the Mayor of London and one of the favourites to be the next leader of the Conservative Party and possibly our PM. The idea that he ought to be liable for US capital gains tax on the sale of his home in London just because he lived in New York till he was five seems completely bonkers.
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- geojanes
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21 Nov 2014, 2:28 pm
Sassenach wrote:It's hard to disagree with him really. I wasn't aware that simply being born in the US makes you liable for federal taxes no matter where you grew up, where you work and where you make your money. Boris Johnson is the Mayor of London and one of the favourites to be the next leader of the Conservative Party and possibly our PM. The idea that he ought to be liable for US capital gains tax on the sale of his home in London just because he lived in New York till he was five seems completely bonkers.
While I agree it is crazy, there are two points that will make it seem a little less crazy:
-- He has the tax liability because he has citizenship. He can renounce citizenship and get rid of future liability. His choice, though there is a fee involved.
-- Local taxes are deductible from the US tax liability. If he had a UK tax liability for selling his house, then that liability would be deductible from the US liability, and he would pay no extra tax. So you're not double taxed, but the idea is that you can't escape a tax simply by moving somewhere where that item is not taxed. There is a logic to it.
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- danivon
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21 Nov 2014, 3:34 pm
geojanes wrote:While I agree it is crazy, there are two points that will make it seem a little less crazy:
-- He has the tax liability because he has citizenship. He can renounce citizenship and get rid of future liability. His choice, though there is a fee involved.
there's a fee to renounce citizenship? I also heard that the liablity persists for some time afterwards anyway.
-- Local taxes are deductible from the US tax liability. If he had a UK tax liability for selling his house, then that liability would be deductible from the US liability, and he would pay no extra tax. So you're not double taxed, but the idea is that you can't escape a tax simply by moving somewhere where that item is not taxed. There is a logic to it.
The logic is that you are taxing Americans, not America. He did not move to avoid taxes on US property (he was 5 when he left), and the property was not in the USA. If it was his main home, it would not be subject to our CGT, but I really fail to see why it makes sense to tax things thousands of miles away that have nothing to do with the USA.
Would they still pursue him if he reaches his goal of being PM?
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- Sassenach
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21 Nov 2014, 3:36 pm
It seems unlikely that they'd try to have him extradited...
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- Sassenach
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21 Nov 2014, 3:41 pm
I can see the point of what George is saying though. This system essentially means that you can't ever have US tax exiles decamping to the Bahamas or wherever in order to avoid paying anything from their earnings. Given the number of tax havens which are conveniently siuated right there in locations that are extremely convenient to the US mainland I can see why the authorities would be reluctant to allow all the rich people in America to move there and evade their tax responsibilities. It's daft in BoJo's case but in most cases it's probably quite a shrewd system.
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- rickyp
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21 Nov 2014, 3:57 pm
It seems unlikely that they'd try to have him extradited..
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They could seize monies from his publisher of royalties earned from the sale of his books in the USA.
It's daft in BoJo's case but in most cases it's probably quite a shrewd system.
It is leading to rising numbers of of dual American citizens renouncing citizenship. Because the US has reached out to other governments to help enforce the taxation.
http://business.financialpost.com/2014/ ... tizenship/
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- geojanes
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12 Apr 2015, 9:38 pm
geojanes wrote:Well, I'm done with this years returns. My rate went up from last year, but I'm still in a very sweet spot
Our last 11 years of rates:
2003: 23.6%
2004: 25.8%
2005: 26.3%
2006: 26.4%
2007: 28.4%
2008: 26.5%
2009: 26.5%
2010: 17.7%
2011: 13.1%
2012: 4.5%
2013: 6.45%
2014:12.2%Taxes were a pain this year: hit the Alternative Minimum Tax. That made the rate go up, but it's still pretty darn low compared to what it used to be. I'm looking forward to some meaningful reform under the leadership of a new president in 2017.
A boy can always hope . . .
