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Republican Tax Plan

^hahahahahhaha; nice catch. 

Three things about carried interest:

1.  I have no idea how much tax is lost/saved by the carried interest “loophole”.  But I imagine that it is enough to fund the government for about thirty seconds. 

2.  In light of #1, I suppose that this “carried interest” nonsense is more for show, or in the name of social policy, rather than as a revenue-raiser. 

3. I imagine that most (if not all) of these hedge fund managers are subject to AMT, which means they are paying an effective rate of at least 31.8%. (28% AMT plus 3.8% Obamacare)

82 > 87
Simple math.

I don’t care if it funds the government for one nanosecond, there’s no coherent argument for why that loophole should exist in the first place. Also, I’m not sure how point #3 is relevant given that AMT is getting the ax as part of this proposal. 

What kind of nonsense are you spitting out greenman? Go file my 1040ez

Oh no, you don't want to mess with a guy thats riding on a buffalo.

GuyOnABuffalo wrote:

https://calcxml.com/calculators/trump-tax-reform-calculator?skn=

Will save me a few thousand compared to the 2017 calculator which surprises me.  I must be interpreting the limited details incorrectly, as I thought it would cost me a few thousand.

This space available.

It’s sort of the principle of the thing.  They looked everywhere for revenue even considered 401ks and retirement plans, but things like the estate tax and carried interest loophole are off the table?

Also, I don’t understand the carried interest loophole in depth but my understanding is that the income received from investment advisory services received through the GP in a partnership is taxed at capital gains rates not basic income?  How is this fee considered a capital gain?  I mean is this a complete giveaway to managers of long term portfolios or is there a reasonable reason this fee is taxed this way.

The tax rationale is that the performance fee (promote, etc.) is a share of the profits in the portfolio, rather than a management fee. 

It’s whatever, just make it count.

- kDot

Is there really a debate on whether these tax codes are fair? I’d say they do exactly their intended purpose - help out the middle class. The issue on state/local taxes is a fair point but perhaps that will lead to pressure to lower state taxes. To me, this is the first time the DT campaign has actually put forth a plan that aligns to their platform promises. 

I also like the proposed elimination of tax shelters for uni endowments - id like to see this translated into religions too. 

brain_wash_your_face wrote:

The tax rationale is that the performance fee (promote, etc.) is a share of the profits in the portfolio, rather than a management fee. 

It makes sense, since current law also allows clients to seize managers’ personal assets to recover losses, amiright?

“Visit the Water Cooler forum on Analyst Forum. It is the best forum.”
- Everyone

if they ever removed the 401k tax deduction. i totally would never save. lol

I love my cheese. I got to have my cheddar.

Nerdyblop wrote:

if they ever removed the 401k tax deduction. i totally would never save. lol

yea.. first 401k’s are used by corps to gut pensions, next they will gut 401ks and youll have people who work til they day they die (which will likely be a younger age due to lack of access to healthcare) this country is awesome lmao

'A flute with no holes, is not a flute. And a donut with no hole, is a danish'

"You want a quote? Haven’t I written enough already???"

RIP

The policy should be to raise taxes during economic booms and cut taxes during economic downturns. Simple! Elect me President!

MailSnoop wrote:

The policy should be to raise taxes during economic booms and cut taxes during economic downturns. Simple! Elect me President!

There will become a certain point where repubs hit a conundrem… picture it now. 2150: Taxes are at 0%, repubs struggling to win an election after years of cutting taxes and no economic gain think up a plan. One says “Guys, lets go back to what has ALWAYS worked for us… cutting taxes! They even pay for themselves!” Brilliant they all think, one of the brightest ideas anyone has ever thought of. 

While studying their proposal one comes upon a terrible fact - “we will turn rates negative! we cant have government handouts!”

Fin.

'A flute with no holes, is not a flute. And a donut with no hole, is a danish'

Yayyywork wrote:

Nerdyblop wrote:

if they ever removed the 401k tax deduction. i totally would never save. lol

yea.. first 401k’s are used by corps to gut pensions, next they will gut 401ks and youll have people who work til they day they die (which will likely be a younger age due to lack of access to healthcare) this country is awesome lmao

It’s kind of crazy people need to be incentivized to save for their own future 

Yayyywork wrote:

MailSnoop wrote:

The policy should be to raise taxes during economic booms and cut taxes during economic downturns. Simple! Elect me President!

There will become a certain point where repubs hit a conundrem… picture it now. 2150: Taxes are at 0%, repubs struggling to win an election after years of cutting taxes and no economic gain think up a plan. One says “Guys, lets go back to what has ALWAYS worked for us… cutting taxes! They even pay for themselves!” Brilliant they all think, one of the brightest ideas anyone has ever thought of. 

While studying their proposal one comes upon a terrible fact - “we will turn rates negative! we cant have government handouts!”

Fin.

It will never get to that point because before it can dems will have expanded social programs to the point where no one actually works anymore and therefore no one pays taxes.

This space available.

there are several reasons why i woudlnt:

1. tax deduction, is immediate gain.

2. lack of flexibility, now i dont have access to my cash, and its stuck in whatever mutual funds my employer has.

3. 10% penalty, if god forbid, i ever have to withdraw it.

pensions are essentialy like 401ks, and companies get a tax write off on it. so if anything 401k should be unlimited contributions :). haha (i keed i keed)

i’ll obvi still save, but i would rather save it in a brokerage/savings account.

I love my cheese. I got to have my cheddar.

higgmond wrote:

It will never get to that point because before it can dems will have expanded social programs to the point where no one actually works anymore and therefore no one pays taxes.

I assume thats the natural end game. If 100% of things were fully automated and computers were making better decisions than humans and we were in a post scarcity world - its interesting to wonder what that would look like. Capitalism is great at creating progress but it also does a fantastic job of concentrating wealth. At a certain point capitalism in its current format wont make sense at all because the owners wont need to employ anyone to produce, and thus no one will have income.

'A flute with no holes, is not a flute. And a donut with no hole, is a danish'

i bet they said the same thing about picking cotton. i keed i keed. but you get what im saying. farming etc. manufacturing etc. 

I love my cheese. I got to have my cheddar.

krnyc2008 wrote:

It’s kind of crazy people need to be incentivize to save for their own future 

I do agree its absurd, however you need to think of how financially illiterate the average person is. We are constantly told we need to incentivize investment by the wealthy, naturally those with less resources have tougher time saving. In general the 401k system doesnt seem to be working. Not sure what the answer is but hopefully someone much smarter than me is working on it.

'A flute with no holes, is not a flute. And a donut with no hole, is a danish'

Nerdyblop wrote:

i bet they said the same thing about picking cotton. i keed i keed. but you get what im saying. farming etc. manufacturing etc. 

Which is a valid argument: But at a certain point machines will make better decisions than humans, and machines to manage and fix those machines. Some human intervention will be needed but with a growing population and dwindling need for a work force, something will have to give.

'A flute with no holes, is not a flute. And a donut with no hole, is a danish'

krnyc2008 wrote:

Yayyywork wrote:

Nerdyblop wrote:

if they ever removed the 401k tax deduction. i totally would never save. lol

yea.. first 401k’s are used by corps to gut pensions, next they will gut 401ks and youll have people who work til they day they die (which will likely be a younger age due to lack of access to healthcare) this country is awesome lmao

It’s kind of crazy people need to be incentivized to save for their own future 

Yup.  Thaler describes it in his book.  https://amazon.com/Misbehaving-Behavioral-Economics-Richard-Thaler/dp/039335279X

Sweep the Leg: "I’m tired."
KMeriwetherD: "Well, you were basically Legolas in the Battle of Water Cooler."

solution is ubi, just tax the rich more. i honestly cant wait for the day when i dont have to work. lol

I love my cheese. I got to have my cheddar.

"You want a quote? Haven’t I written enough already???"

RIP

Yayyywork wrote:

krnyc2008 wrote:

It’s kind of crazy people need to be incentivize to save for their own future 

I do agree its absurd, however you need to think of how financially illiterate the average person is. We are constantly told we need to incentivize investment by the wealthy, naturally those with less resources have tougher time saving. In general the 401k system doesnt seem to be working. Not sure what the answer is but hopefully someone much smarter than me is working on it.

Cursory glances at the weekly shopping behavior of my fellow neighbors over the past decade leads me to the conclusion that it is in no way surprising that the majority have little to nothing saved for retirement.  The rate at which people spend every cent of their disposable income, or worse go into debt, on **** they don’t need is really depressing.  The malls and shopping centers around here are utterly insane every weekend.  And that’s considering a lot of people do their consumer product buying on Amazon.  

higgmond wrote:

Yayyywork wrote:

MailSnoop wrote:

The policy should be to raise taxes during economic booms and cut taxes during economic downturns. Simple! Elect me President!

There will become a certain point where repubs hit a conundrem… picture it now. 2150: Taxes are at 0%, repubs struggling to win an election after years of cutting taxes and no economic gain think up a plan. One says “Guys, lets go back to what has ALWAYS worked for us… cutting taxes! They even pay for themselves!” Brilliant they all think, one of the brightest ideas anyone has ever thought of. 

While studying their proposal one comes upon a terrible fact - “we will turn rates negative! we cant have government handouts!”

Fin.

It will never get to that point because before it can dems will have expanded social programs to the point where no one actually works anymore and therefore no one pays taxes.

Snark aside, what the heck is wrong with this?  Working blows.

ltj wrote:

Snark aside, what the heck is wrong with this?  Working blows.

Especially pointless work like finance

'A flute with no holes, is not a flute. And a donut with no hole, is a danish'

ltj wrote:

higgmond wrote:

Yayyywork wrote:

MailSnoop wrote:

The policy should be to raise taxes during economic booms and cut taxes during economic downturns. Simple! Elect me President!

There will become a certain point where repubs hit a conundrem… picture it now. 2150: Taxes are at 0%, repubs struggling to win an election after years of cutting taxes and no economic gain think up a plan. One says “Guys, lets go back to what has ALWAYS worked for us… cutting taxes! They even pay for themselves!” Brilliant they all think, one of the brightest ideas anyone has ever thought of. 

While studying their proposal one comes upon a terrible fact - “we will turn rates negative! we cant have government handouts!”

Fin.

It will never get to that point because before it can dems will have expanded social programs to the point where no one actually works anymore and therefore no one pays taxes.

Snark aside, what the heck is wrong with this?  Working blows.

The problem with it is that I, and presumably you, enjoy a lifestyle that is not supportable by current social programs and it will take an awfully long time for the economy to transition to the point that my lifestyle, and again presumably yours, can be supported by social programs.  In the meantime, I, and presumably you, will continue to slave away to support not just our own families, but the ever growing number of families who decide that the lifestyle provided by social programs is good enough for them.  If you could flip a switch tomorrow that allows me to maintain my current lifestyle, or even a slightly reduced one, without working, I’d say hell yeah.  That’s not going to happen though.  That utopia is an option that’s way, way, way out of the money for me.

This space available.

^So long a social programs promise at least one bidet per house, I’m in.