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Veteran Advisor

Really Good Reporting there, Bruce

But the corporate tax code is so shot through with loopholes that many corporations pay extremely low rates. And the low rate for capital gains applies whether or not the taxpayer's gain is on a type of investment that is subject to corporate taxes.

 

Seems like an indepth look at double taxation to me...right? One sentence making the statement that "many" corporations pay "extremely low rates".

 

Guess with that type of critical analysis, all makes sense 24-7.

 

I give up sometimes.

 

I think it is true what is oft said about liberals.

Veteran Advisor

check out "install nt gain tax reporting" nt

 

Re: The Mittster

Sure, makes sense.

 

Also if all marginal rates were reduced along with most loopholes and deductions, the bite on investment income would be reduced also.  That would be some relief to the muckymucks although not the selective relief that they've come to expect from their servants in government.

 

Also should lower the corporate rate accordingly and cut loopholes there also. I don't see much wisdom in setting the top rate below the top personal rate but anyway.

 

I also think you can counter the "killing job creation" meme by putting in a 0 corporate bracket to, say, $100K and maybe a 10% rate to 300K, 20 to 500k.

 

That will have essentially no impact on GE or Microsoft but would mean that small businesses that are serious about retaining capital for growth can really go at it.

 

Since I'm always surprised at how little many people understand about business organization and accounting, the way that would work is that the prop(s) would pay themselves salaries and pay at the personal tax rate on that.

 

Salary and benefits to owners would be expenses to the corp and therefore come off the bottom line. Retained earnings could stay in to grow the business at a very attractive rate. 

 

There would need to be a few regulations surrounding that to keep people from gaming it but it would be pretty straightforward.

Senior Advisor

Re: Really Good Reporting there, Bruce

I think you will find that many funds that manage investment portfolios pass their earnings on directly to the investors and the fund has not tax responsibility.

Veteran Advisor

Re: Really Good Reporting there, Bruce

as my norwegian grandmother would say...uff da.

 

if the fund had to pay taxes, too, it would be triple taxation, pal. Think about it.

 

Or better yet, don't.

 

And, don't vote.

Advisor

Re: What you say

"tax expenditure"

 

As if not taking someone's money was spending, Orwell would be proud of that language twist.

Re: Really Good Reporting there, Bruce

The question of double taxation does arise in C corporations where corporate tax is paid before dividends and then dividends are taxed also by the receiving entity.

 

That is not likely the bulk of the issue at hand here but it does exist, just for the sake of clarity.

 

On this matter it appears to Bachmannesque in nature by which I mean that while it isn't true, we all know that the spirit in which it was said is righteous so it might as well be.

speaking of being surprised

about how little people know about business structures and accounting, when I've mentioned the amusing fact that apparently Joe the Plumber thought that his boss paid income tax on his gross (and thought that he paid the marginal rate on all of it) I recall getting a few confused looks from people who you'd expect to understand.

Senior Contributor

Re: The Mittster

"Also quite reasonable to lower brackets across the board and cut loopholes."

 

Nox, wasn't that idea proposed by Cantor last summer?

Senior Contributor

Re: The Mittster

Most of Romeny's income is from investment capital, there by law it is taxed at a lower rate. It's pretty simple. I don't hold it against him. It's the way it is.