patrick.net

sbh says

trickle-downer conservative hiding in a Libertarian cowl

I always figured the self-described libertarians I knew were just ashamed to be voting the same way as Southern Baptists on issues like abortion, gay marriage, flag burning, what have you.

So they rationalized their voting behavior for the world to see as an unfortunate compromise: go with the party of low personal freedom but more economic freedom - let's assume that the Republics really stand for economic freedom, for the sake of this argument - and then, once economic freedom is achieved, then we would get more social freedoms, either by default - we'd all be rich - or by attacking those issues next.

If this sounds like Marx's "the state shall whither away," that isn't a coincidence. It's essentially inverted Marxism: If we have economic anarchy, total freedom in all things will follow, as opposed to Marx's idea of the rational, economically centralized state purging us of petty class motivations and prejudices, which would then remove the very underpinnings of the state.

Both sound like bullshit to me.

Problem is, many libertarians really, really hate the idea of gay marriage and are fine with an abortion ban.

More and more, I now feel some sympathy for libertarians. I don't see them so much as hypocrites but more as victims of a scam: trickle-down disguised as rational freedom.

HydroCabron says

let's assume that the Republics really stand for economic freedom, for the sake of this argument.

I don't think they do - there's a few amongst them who do but certainly not enough, That's why a second party is needed. I have also consistently been advocating civil/social liberties (so have a even a few Republicans).

sbh says

I respectfully suggest

A valid point does not become invalid just because it isn't addressed. I would suggest you look in the mirror and refrain from personal attacks. Look around, we are all diverse. I don't always see eye to eye with Tom Wong, but he apparently has valuable input and experience (esp. regarding CA/SV business). Same goes for Dan, or Fort Wayne who likely is socially far more conservative than I am. Try to embrace other people's viewpoints instead of labeling them as "foxbots, right-wing shills, tickle-downers etc.", esp. since you know nothing about them beyond the topics discussed on patnet.

SiO2 says

I agree that anarcho-libertarian paradise is going to lead to poverty for the majority.

Whatever your understanding of this nebulous term may be, it certainly isn't debating long-term vs short term capital gains taxes which most of the countries have different tax rates for. Neither is questioning capital flight and/or people with wealth moving out of the country due to higher tax rates. Nowadays where business mostly exist on a couple of servers, you can easily set up a corporation outside of the US where the business transactions will happen, and therefore skirt higher taxes (with some restrictions that a good lawyer can take care of). This is reality, not fiction, happening every day. Nobody is advocating an anarcho paradise.

SiO2 says

I agree that anarcho-libertarian paradise is going to lead to poverty for the majority.

Poverty really doesn't matter. Most people were happier under feudalism - look it up.

Also, they'll still have the right to own guns - even thought they won't be able to afford them - and visit war memorials as often as they can afford to fly to Washington, D.C. and book a hotel room.

SiO2 says

On the other hand, communism (ussr-style in the 60s,70s,80s) led to more poverty and misery

It was almost as bad in the United States. I hope you're sitting down when you read this: we... taxed... (are you ready?)... capital gains (gasp!) at a higher rate than we do today.

Life in the United States was a vast landscape of death and desperation back then.

Regarding capital gains, I would be for taxing them as ordinary income, but would increase write offs from 3K per year to unlimited, however the wash sale rule would have to be strictly enforced.

dublin hillz says

Regarding capital gains, I would be for taxing them as ordinary income, but
would increase write offs from 3K per year to unlimited, however the wash sale
rule would have to be strictly enforced.

This 3k point is a bit disingenuous. It is actually beneficial if you think about it.

You are taxed 20% on capital gains, and can write off up to 3k of capital losses per year against ordinary income. This is important. You are potentially lowering taxable wage income (taxed at higher rate) with losses that would have been taxed at only a 20% rate if they would have been gains.

Further, it is only $3k per year if you never have any other gains. If you lose $50k one year, you write off $3k at your highest marginal rate (lets say 25%) and carry over the $47k remaining. If you gain $50k the next year, you pay no taxes on $47k of that gain, and 20% on the $3k excess.

Net, you have essentially paid less taxes than if you wouldn't have done either trade, but have not gained or lost anything except the opportunity cost of your $50k.

control point says

Further, it is only $3k per year if you never have any other gains

If you never have other gains, perhaps investing is not the right thing to do.

I agree with the sentiment posted that cap gains should be taxed as regular income. Why favor investment over work? But, they should be inflation adjusted. If you buy stock in 1980 for $100, and it's worth $150 now, you are actually worse off. So there shouldn't be tax on that.

Lifting the 3k cap for offsetting losses is an interesting point.

mell says

Nowadays where business mostly exist on a couple of servers, you can easily set up a corporation outside of the US where the business transactions will happen, and therefore skirt higher taxes (with some restrictions that a good lawyer can take care of). This is reality, not fiction, happening every day. Nobody is advocating an anarcho paradise.

your not skirting any taxes... how could you ? Your gonna get taxed by the home countries taxing authority and any foreign nations you do business with.

for USA companies, they pay domestic and foreign tax. there is a foreign tax credit used by corporations are there is one for individual tax payers.

there are no lawyers or accountants that can fix anything to hid transactions or skirt taxes..unless your completely working for a criminal organization.

control point says

Further, it is only $3k per year if you never have any other gains. If you lose $50k one year, you write off $3k at your highest marginal rate (lets say 25%) and carry over the $47k remaining. If you gain $50k the next year, you pay no taxes on $47k of that gain, and 20% on the $3k excess.

Net, you have essentially paid less taxes than if you wouldn't have done either trade, but have not gained or lost anything except the opportunity cost of your $50k.

the carry over provision is there for a purpose.. as was the case with carry over deductions from medical and charitable deductions... yes that too lowers individual
taxes..

thomaswong.1986 says

mell says

Nowadays where business mostly exist on a couple of servers, you can easily set up a corporation outside of the US where the business transactions will happen, and therefore skirt higher taxes (with some restrictions that a good lawyer can take care of). This is reality, not fiction, happening every day. Nobody is advocating an anarcho paradise.

your not skirting any taxes... how could you ? Your gonna get taxed by the home countries taxing authority and any foreign nations you do business with.

for USA companies, they pay domestic and foreign tax. there is a foreign tax credit used by corporations are there is one for individual tax payers.

there are no lawyers or accountants that can fix anything to hid transactions or skirt taxes..unless your completely working for a criminal organization.

Apparently Apple was able to do it and it wasn't illegal:

http://online.wsj.com/news/articles/SB10001424127887324787004578495250424727708

thomaswong.1986 says

You know of any regulations which would have stopped irrational exuberance /
speculation over the public infatuation over internet stock..or home prices ?

You want to regulate peoples actions.. but you dont know what actions they
will take which
creates speculations.. Beenie Babies anyone ?

Enforcing lending standards would have stopped the housing bubble.

mell says

Apparently Apple was able to do it and it wasn't illegal:

http://online.wsj.com/news/articles/SB10001424127887324787004578495250424727708

Alot of companies bugged out of continent due to litigation and high severance costs.. moved their HQ to UK or Ireland. Thats a question France, Italy, Germany and others have to deal with. And yes The Irish are very happy to get the tax dollars and require international companies to hire their citizens, the Irish are not complaining at all. What the Irish dont tax, gets taxed and is due to the US IRS.

For US IRS purposes its all Global income is taxable ....but we dont double tax the same international pre tax income. If less than statutory foreign tax is paid, the more US IRS collects.

http://www.irs.gov/Individuals/International-Taxpayers/Foreign-Tax-Credit

Foreign Tax Credit
If you paid or accrued foreign taxes to a foreign country on foreign source income and are subject to U.S. tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes. Taken as a deduction, foreign income taxes reduce your U.S. taxable income. Taken as a credit, foreign income taxes reduce your U.S. tax liability. In most cases, it is to your advantage to take foreign income taxes as a tax credit.

The Journalist need to start asking the big 4 Accounting Firms how all this works.

page 61

http://investor.apple.com/secfiling.cfm?filingID=1193125-12-444068&CIK=320193

thomaswong.1986 says

You know of any regulations which would have stopped irrational exuberance / speculation over the public infatuation over internet stock..or home prices ?

Yes. Banking regulations forbidding banks from playing in the derivatives markets.

But they were repealed in the late 1990s, by Phil Gramm, Jim Leach, and Thomas Bliley, with the help of a compliant House and Senate, and a whore President with no guts to veto.

It once was the case that members of both parties believed in sensible regulation. A minority of Democrats now do, and nearly none in the Republican Party do, since it has now become a religious cult.

A flashback:

During debate in the House of Representatives, Rep. John Dingell (Democrat of Michigan) argued that the bill would result in banks becoming "too big to fail." Dingell further argued that this would necessarily result in a bailout by the Federal Government.

Hahaha! What a socialist asshole! Can you believe that Marxist, Stalinist, Castro-loving crap!

HydroCabron says

Hahaha! What a socialist asshole! Can you believe that Marxist, Stalinist, Castro-loving crap!

doesnt Dingell represent Detroit.. where is the beacon ?

thomaswong.1986 says

The Journalist need to start asking the big 4 Accounting Firms how all this works.

Why? It's not magic to read a 10-k, the journalists numbers look about right. Take Apples 10-k. Go to the line that says income, 55.7 billion. Then go to the statement of cash flows taxes paid, 7.7 billion giving a rate of 13.8%. Back out state taxes and foreign taxes (footnote #5) of 2.2 billion you come up with 5.3 billion for a tax rate of 9.5% which much higher than 2011 at 5.3%. Just a touch short of the 35% federal rate they are supposed to be paying to have their operations in the good old USA.

bob2356 says

Why? It's not magic to read a 10-k, the journalists numbers look about right. Take Apples 10-k. Go to the line that says income, 55.7 billion. Then go to the statement of cash flows taxes paid, 7.7 billion giving a rate of 13.8%

Journalist know shit!

Pg 61...A reconciliation of the provision for income taxes, with the amount computed by applying the statutory federal income tax rate (35% in 2012, 2011 and 2010) to income before provision for income taxes for 2012, 2011, and 2010, is as follows (in millions):

$ 19,517 / 55,763 = 35%

Again there is a difference between Gaap Pre-tax vs IRS reported taxable income..

Paid vs accrued (Liable) due to temp differences plus credits. what isnt paid is still taken to the P/L and will be paid once the temp differences expire Therefore the taxable income will be much less than 55B per GAAP. You really need the Tax return for that. A typical investor doesnt need such information.

http://en.wikipedia.org/wiki/Deferred_tax

http://www.youtube.com/embed/45PARid_erY

thomaswong.1986 says

Again there is a difference between Gaap Pre-tax vs IRS reported taxable income..

Paid vs accrued (Liable) due to temp differences plus credits. what isnt paid is still taken to the P/L and will be paid once the temp differences expire Therefore the taxable income will be much less than 55B per GAAP. You really need the Tax return for that. A typical investor doesnt need such information.

So you are saying apple is lying on the 10-k, the tax return will have a significant difference in numbers? I'm sure the investors would be very interested in that. Pretty amazing how those temp differences keep happening year after year after year after year. What decade do you project they will actually expire and apple will send a really huge check to the IRS?

Very interesting you get your tax accounting information from youtube and wiki. I guess journalists don't have access to those types of research resources. Anyway thank you for confirming what I suspected all along was the basis of your alleged tax knowledge.

bob2356 says

Very interesting you get your tax accounting information from youtube and wiki. I guess journalists don't have access to those types of research resources. Anyway thank you for confirming what I suspected all along was the basis of your alleged tax knowledge.

You don't know who your dealing with.

I'd back off, if I were you: thomaswong.1986 says he reads The National Review. You can't win against that kind of intellectual firepower!

thomaswong.1986 says

For US IRS purposes its all Global income is taxable ....but we dont double tax the same international pre tax income. If less than statutory foreign tax is paid, the more US IRS collects.

http://www.irs.gov/Individuals/International-Taxpayers/Foreign-Tax-Credit

Thomas, your comment is true for individuals. But the recent discussion is about companies. Apple USA Inc can do something that an individual cannot do; they can set up Apple Ireland Inc, assign the value of the patents to Ireland, say that the sales in EU are out of the Irish subsidiary. Apple USA Inc would only pay USA taxes on whatever Apple Ireland Inc pays to Apple USA Inc.

A person can't do this with W-2 income, as stated in your link. But that's not really relevant to this question of companies setting up subsidiaries in other places.