Thoughts

"However, if you look at it from a 'total tax' perspective, Florida ain't fair."

I stylized the term purposefully as "FairTax" hoping that would make it clear, I guess not.

"FairTax states" are ones that collect their revenue primarily through consumption and property taxes and not income taxes, much in the way the moribund federal FairTax proposal was supposed to work. While there are some differences, the states are Florida, Texas, Tennessee, Wyoming, Nevada and I think Washington.

Because we have no state income tax, we deduct state sales tax off our fed returns instead.

More true than you have the comprehension to understand

Shirts and skins

Shirts and skins

You are a simpleton. Why do you think I pay that CPA firm? Pssssst to make the tax code my bitch.

Oh to live in the delusion world of PHX.

“ONEHELL---->What’s your attraction to either party then?
There is A) a reason why I'm a registered Independent and B) why I pay close to a kings ransom to firms that employ people like Erotic's wife.”

Never a word about making the tax code his bitch.

VABEACH---->It won't matter a whole lot to most people because most people making money like that are organized as LLCs and such and not true salaries. People with the resources to rearrange everything to just work around it, like we do by taking them as shareholder distributions.

Probably one of the most honest assessments I've seen here in close to a month, if not longer. Kinda mirrors what I said about paying close to a King's ransom to my CPA firm about 3 weeks ago to basically accomplish the same thing. Not necessarily in my case to work around it. More like making the outdated, bloated tax code my bitch.

OK, back to the cute one liners and the throwing of shit on the walls. Enjoy!

I would just quibble about the property tax in California.

Depending on how long you have owned your house, your tax bill could be wildly different from your next door neighbor who has the exact same floor plan.

My friend inherited her house when her parents died. According to Zillow, the house is worth $761K.

She pays $1,000 a year on an assessed value of $95,021.

The house with the closest value on the block ($756K) pays $7,313 on an assessed value of $650K.

The difference? My friends house was purchased in the 1970s and the house down the block was purchased in 2005.

Folks, it is very hard to get away from the high overhead of life. We are all running around in circles. It's a big, "circle jerk".

" FairTax-style tax regimes like Florida."

HUH?

I am a 7th generation Floridian. If you want to get into very small segments, sure you can paint that picture. However, if you look at it from a 'total tax' perspective, Florida ain't fair.

Here, let's do some simple comparisons:

CA - family of 2, income is 180k a year, live in a 800k place. Your state tax would be ~10k. Your property taxes would be ~ 8k.
FL - family of 2, income is 150k (salaries are lower there), live in a 500k place. Your state tax would be zero. Your property taxes in Oviedo, FL would be ~ 7500. (Seminole tax estimator)

So one place you get 18k in taxes, the other you get 7500. Due to SALT, you have an 8k difference. Is the extra 30k in income worth 8k more?

That is just the tax issue.

Now we can add in other costs of living. Car insurance and homeowners insurance are massively more in FL than in CA. That 800k house in CA would have a homeowners of about 800. What is it in FL on that 500k house? Probably 4k.

At the end of the day, government is about providing services to citizens. It costs money to do that. If we, as citizens stopped demanding services, then it makes perfect sense to pay less or none. But we demand that the roads be there. We demand that the water be clean. We demand that the cops and firemen show up. We demand that citizens get a basic education. All of that costs money. In Florida, and especially in Orlando, tourism is a huge component of that revenue. Those bed tax and car rental surcharges are a big part of the budget.

I think your accountant probably added something to this comment. My Florida accountants loved elections. I asked them why. They said, every administration comes in and makes changes. As they are in the business of understanding those changes and preparing tax returns off that, those changes kept them in business.

“ Your average taxpayer thinks that for most of us it just means our paycheck is smaller, or our "refund" not as big. Most people have absolutely no idea. Nor do they care.”

I do not think that is true at all. Your paystub May look different. Bottom line is the Fed is gonna get their money. Everyone wants the most they can get with paying the least possible.

She's a tiny Indian woman who calls herself "bad Hindu", because she drinks and eats meat.

But yes, she's very beneficial to us.

While in some cases tax changes don't have to result in a net loss to the IRS, they always involve other costs. Lawyers, accountants, TPA fees, endless meetings and conference calls, etc. I own an LLC in Wyoming, 3 in Florida and one in Nevada now. I've never even been to Wyoming. These things cost money to establish and administer.

Your average taxpayer thinks that for most of us it just means our paycheck is smaller, or our "refund" not as big. Most people have absolutely no idea. Nor do they care.

Sounds as though you have a good accountant. I’m sure he will come up with a way to save you that money. After all, isn’t that what they’re paid for?

Was that so hard to tell us?

The SS system as you know is an involuntary benefit and insurance plan and not truly a "tax". Benefits are commensurate with the premiums paid. Most people of course do not understand this and just see the lack of SS premiums on high income as the rich somehow not paying their fair share. Politicians are more than happy to exploit this ignorance.

While I am meh on my opinions of SS, I don't find it completely philosophically objectionable.

But to bring in a new SS tax on incomes over any other amount just turns it into another tax. I haven't seen any clarification as to whether or not it would just be taking money or if there would also be an increase in benefits. Not that most people give a fuck.

It won't matter a whole lot to most people because most people making money like that are organized as LLCs and such and not true salaries. People with the resources to rearrange everything to just work around it, like we do by taking them as shareholder distributions.

I would think that the SS tax increase would be more feasible than others.

What most people don't realize is that tax policy is overall, a means of social control. Taxes and deductions are designed to change behavior.

I definitely have mixed feelings about that...

SALT tax limitations are a much smaller factor for people who live in FairTax-style tax regimes like Florida. I don't like it either but its not a large factor for me personally.

But that's OK because the "average taxpayer" doesn't have to worry about it, right? (sarcasm)

IMO Biden's campaign has made a huge strategic error in making such a large part of his platform "sticking it to the rich guy and corporate America". What friends is he making it with this? Anyone who loves the idea was already going to vote for him, but he's no doubt made enemies out of people and companies far bigger and more powerful than l'il ol' me, people that can't stand Trump but will be slammed very very hard by the alternative.

While your average taxpayer doesn't know or care about most of these things, people such as myself or most of the people I know were almost unanimous in our preference for Biden over Trump. That's not true anymore.

@your, that one hurts a lot of people. Thank god I moved out of NJ. Saw the difference on my dad's returns who still lives in NJ.

tbr, at least you know enough about me to know that I'm not (usually) just flapping my arms and parroting crap from ZeroHedge or something, so thanks for that.

Some of these proposals are more politically feasible than others.

The SS tax on high incomes is not going to happen. I'm not very worried about that.

The upper income tax increase is small and not a large factor. Since we collect most of our money as shareholder distributions none of this matters. This concept also applies to the SS tax.

The biggest threats for me are QBI deduction elimination and changes to rules about self-directed IRA's. The QBI because it's a large and direct hit on our bottom line, and its politically feasible.

The costs associated with the IRA rules would be significant and would mostly go to lawyers, accountants, and TPA administrators, not the IRS. This one is also politically feasible, and would also cost us lots of time (which is also expensive).

Well, in his defense, he did say "if all of Biden's proposals go through..."

Which they won't.

Which he knows.

But it is a good idea to know worse and best case scenarios.

"What I'd really settle for is for Trump to no longer be president and for everything else to go back to how it was in late 2019. Not that everything was hunky dory, but it was a largely liveable situation."

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^^This. - Well, How about 2016?

Whoever cooked up the SALT tax bs need have their ass kicked. That one issue along with the so called 'tax reform' is costing me thousands annually.

“I said , ‘My accountant can't stand the idea of Biden's tax proposals becoming a reality."

That is like saying, “I heard, a friend told me, a brothers, sister in law’s, brother told me”. There is absolutely no substance in your statement. Unless you can state an actual change to the tax code that will cost you 50K a year. It’s nothing but opinion. Your accountants, a friend, a shirt tail relative.

You want to bring it up, but not back it up. Facts. We need facts.

"It's ok, he left out that..."

Please don't pretend to know or understand anything about my personal circumstances or which proposals would impact me in which way.

Most of them are related to things that most people have never heard of.

as for you other people complaining that I won't engage further on a topic that "I brought up"

I said "My accountant can't stand the idea of Biden's tax proposals becoming a reality."

That's it.

Everything else I said was answering your questions.

Making a short statement like I made does not obligate me to engage with anyone in a protracted argument.

"That's so fucking true"

That's also why I said

"And while the reasons and effects for such policies are complex and saying its "designed to target" specific types of people is overly simplistic..."

"No one likes paying taxes, but it is the price we pay to live in a first world country,

Money is fungible. The dollars one pays in taxes don't get thrown into the fireplace and burned up. They get used to fund all kinds of things, some of which have a greater multiplier effect on the economy than individual spending."

That is so fucking true.

It's ok, he left out that Trump did raise taxes on him. Well, maybe maybe not. His property taxes probably sit under the 10k exemption. It's ok, if his house appreciates and the taxes go up, he will go past that threshold.

What people fail to realize is that no matter what you do as a person, paying taxes has the best effect for everyone. Yes, better than anything else you can do.

He’s said enough. He is bored with this topic he brought up.

He took his ball and went home.

Unless you agree with him or praise him he doesn’t want to play.