Romney's Money | Taxes vs Tithe

[Trey of Diamonds]

So, Romney paid 14% in Taxes and 10% in Tithes. Does that mean he's 4% more loyal to the American people over the LDS Church? Obama thinks he should pay 30% in taxes. What do you think?

http://www.cbs12.com/news/church-4738329-romney-mormon.html

 

[9-10ths_Penguin]

So, Romney paid 14% in Taxes and 10% in Tithes. Does that mean he's 4% more loyal to the American people over the LDS Church?

I think it means that if he doesn't pay 14% in taxes, he'd get assessed even more in penalties from the IRS.

Obama thinks he should pay 30% in taxes. What do you think?

Is that 30% the net rate or the marginal rate?

 

[Trey of Diamonds]

Is that 30% the net rate or the marginal rate?

Buffett rule tax set at 30 percent: Obama speech | Reuters

 

[Reverend Rick]

If you think capital gains should be taxed at the same rate as income, that would be unfair too.

There is a big difference between guaranteed income and investment.

There is alot of old folks who are retired that have capital gains to consider too.

As far as Romney is concerned, he gave around another 7% to charity in addition to his 10% tithes.

 

[9-10ths_Penguin]

If you think capital gains should be taxed at the same rate as income, that would be unfair too.

There is a big difference between guaranteed income and investment.

There is alot of old folks who are retired that have capital gains to consider too.

As far as Romney is concerned, he gave around another 7% to charity in addition to his 10% tithes.

Why would it be unfair?

I always thought that the lower tax rate on capital gains was to encourage investment, not to help compensate for risk.

There are other mechanisms to deal with investment risk: carry-forward of investment losses from one year to another, for instance.

 

[9-10ths_Penguin]

Also, i think retired people are a bit of a red herring in this discussion. Retirement savings get different tax treatment anyhow, so presumably the tax rates/rules for them can be tweaked as needed if other changes would produce undesirable effects in that department.

 

[9-10ths_Penguin]

Another thought: I don't know if you have something similar down there, but up here in Canada, we have something called "Alternative Minimum Tax": if your income is fairly high and your net tax rate calculated the normal way works out to less than the AMT rate (36%, IIRC), then you pay the AMT rate on your total income.

 

[Mathematician]

If you think capital gains should be taxed at the same rate as income, that would be unfair too.

There is a big difference between guaranteed income and investment.

There is alot of old folks who are retired that have capital gains to consider too.

As far as Romney is concerned, he gave around another 7% to charity in addition to his 10% tithes.

If anything investments should be taxed higher than income since 1.) it is made from the labor of others and 2.) relies on the government protecting corporations through special privileges (personhood, etc.); I'd settle for equal, though.

 

[Reverend Rick]

When a person has investment capital, they already paid taxes on that money that is theirs.

There is a big difference between income and investments.

If you have a contract and will receive money for working, that is guaranteed income.

When you invest, some times you lose your investment. Because of that risk, the tax rate is lower.

If you raise the capital gains tax, you change the risk reward scenario.

People may decide to not invest if the taxes are raised. Think about it, investors who stop investing that do not have a job would owe zero taxes.

Mitt Romney is the perfect example. He could live off his money for the rest of his life and never work or invest again. In this example, his tax liability would be zero.

Rich folks could vote with their feet and leave the country and invest elsewhere taking their money with them.

 

[9-10ths_Penguin]

Jusr another thought: Rick, exactly what do you mean by "guaranteed income"? I hope you don't mean employment income. After all, if the company owner loses his or her shirt on the company as an investment, odds are that this will result in layoffs or salary cuts, too.

The closrst thing I can think of to a "guaranteed income" would be something like a CD or a government bond, but that income would be taxed as a capital gain, wouldn't it?

 

[Mathematician]

When a person has investment capital, they already paid taxes on that money that is theirs.

There is a big difference between income and investments.

If you have a contract and will receive money for working, that is guaranteed income.

When you invest, some times you lose your investment. Because of that risk, the tax rate is lower.

If you raise the capital gains tax, you change the risk reward scenario.

People may decide to not invest if the taxes are raised. Think about it, investors who stop investing that do not have a job would owe zero taxes.

Mitt Romney is the perfect example. He could live off his money for the rest of his life and never work or invest again. In this example, his tax liability would be zero.

Rich folks could vote with their feet and leave the country and invest elsewhere taking their money with them.

You're taxed on gains, not on investment. If you lose money, you don't pay any taxes. It's perfectly fair. There is no "double taxation" other than perhaps corporate taxes, which Obama plans to reduce. Even then that's the price you pay for incorporating. You could have remained a separate business entity and not enjoyed the legal benefits.

No they couldn't. Rich people need demand to remain rich. Losing out on 300 million of the wealthiest, hardest working citizens in the world would bankrupt them.

 

[Reverend Rick]

Jusr another thought: Rick, exactly what do you mean by "guaranteed income"? I hope you don't mean employment income. After all, if the company owner loses his or her shirt on the company as an investment, odds are that this will result in layoffs or salary cuts, too.

The closrst thing I can think of to a "guaranteed income" would be something like a CD or a government bond, but that income would be taxed as a capital gain, wouldn't it?

OK, I could get on board being taxed on an investment like that becasue there is no risk. 30% may be appropriate in those examples.

I'm telling you that investors that do take risks would take less risks if their taxes where raised.

 

[Reverend Rick]

If anything investments should be taxed higher than income since 1.) it is made from the labor of others and 2.) relies on the government protecting corporations through special privileges (personhood, etc.); I'd settle for equal, though.

Labor of others? I cry B.S.

If you have a great idea for a company you want to run and I invest in your company, I have enabled you to realise your dream.

With out investors, your dream is dead and you have no business.

 

[Reverend Rick]

You're taxed on gains, not on investment. If you lose money, you don't pay any taxes. It's perfectly fair. There is no "double taxation" other than perhaps corporate taxes, which Obama plans to reduce. Even then that's the price you pay for incorporating. You could have remained a separate business entity and not enjoyed the legal benefits.

No they couldn't. Rich people need demand to remain rich. Losing out on 300 million of the wealthiest, hardest working citizens in the world would bankrupt them.

No it's not perfectly fair! When I invest a million dollars and lose it all and have to double down with another million, it may take me 10 years to get back to zero all the while you tax me every year and my investments are under water.

Yes I made money on the second million, but I would have been ahead never investing with your idea of draconian taxes being fair.

 

[Mathematician]

Labor of others? I cry B.S.

If you have a great idea for a company you want to run and I invest in your company, I have enabled you to realise your dream.

With out investors, your dream is dead and you have no business.

Investing is just shuffling around money to purchase labor and goods, that which in itself is only made possible by others' labor.

"Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed." - Lincoln, American president, abolitionist, socialist?

So you think gains shouldn't be taxed? That's socialism - socialism in favor of the rich.

 

[Reverend Rick]

If you raise taxes on investors, less money will be invested. Count on it.

 

[Trey of Diamonds]

If you raise taxes on investors, less money will be invested. Count on it.

Maybe so, but all that will eventually equal out and right now I'm more worried about paying for infrastructure, schools, health care and all the other things that keep our society alive.

 

[Mathematician]

If you raise taxes on investors, less money will be invested. Count on it.

You're ignoring the premise now and just babbling on about investments while defending socialism for the rich -- which goes by the word fascism.

Why should I pay more in taxes for work that I put in than someone who made a reward on investments? You have no justification other than some economic forecast.

 

[9-10ths_Penguin]

OK, I could get on board being taxed on an investment like that becasue there is no risk. 30% may be appropriate in those examples.

I'm telling you that investors that do take risks would take less risks if their taxes where raised.

I think this goes back to the question of why capital gains get the special rate they do. I don't think it's about risk; I think it's about encouraging investment. My money will do more good for the economy and society in a CD than in a shoebox under my bed, so the government encourages me to hand it over so that the bank can loan it out to someone else.

And sure, people would be more risk-tolerant with their investment if those risks were subsidized by the government, but should the government really be in the business of encouraging risky investments?

... especially when they already allow you to carry forward your capital losses to offset your capital gains in future years?

 

[Reverend Rick]

You're ignoring the premise now and just babbling on about investments while defending socialism for the rich -- which goes by the word fascism.

Why should I pay more in taxes for work that I put in than someone who made a reward on investments? You have no justification other than some economic forecast.

Thats bull Gene. I had to work for others and they made money off of me and I had to pay taxes on my labor.

You keep forgetting that you have to first earn money before you can invest.

You overlook that I am taking a risk on my hard earned money.

You ignore that I am enabling someone to run a business that would otherwise not have a business and a means to earn.

No one owes you a job.