he is not the best person to ask financial questions to, as well as, he has no idea how many homes he owns, as well as, when we was asked what he thinks constitutes being rich he stated he thinks that $5M in income per year... He will put this country into a tailspin for decades leaving our children and their children's children left to scrape up the mess. It's quite simple, from the financial side of politics, if you make $5M a year or more you might want to vote for McCain. Otherwise, you would be wise to vote for Obama. That leaves out approx. 99.07% of the people...This has nothing to say regarding women's rights issues, the fact that McCain has no idea what some country's are and where they are. As Biden, the great new pick for Democratic VP, has stated that just because John is a war hero does not mean he is ready for president. I agree!! Both of their tax plans are out and should be reviewed. With help from The Wall Street Journal, you can see some of those ideas here. | |||||||
The Obama Tax PlanBy JASON FURMAN and AUSTAN GOOLSBEE August 14, 2008; Page A13 The Wall Street Journal Even as Barack Obama proposes fiscally responsible tax Many of these very same critics made many of these same
Overall, Sen. Obama's middle-class tax cuts are larger Both candidates for president have proposed tax plans. But they are starkly different in their approaches and their economic impact. Sen. Obama is focused on cutting taxes for middle-class families and small businesses, and investing in key areas like health, innovation and education. He would do this while cutting unnecessary spending, paying for his proposals and bringing down the budget deficit. In contrast, John McCain offers what would essentially be a third Bush term, with his economic speeches outlining $3.4 trillion of tax cuts over 10 years beyond what President Bush has already proposed and geared even more to high-income earners. The McCain plan would lead to deficits the likes of which we have never seen in this country. It would take money from the middle class and from future generations so that the wealthy can live better today. Sen. Obama believes a focus on the middle class is appropriate in the wake of the first economic expansion on record where the typical family's income fell by almost $1,000. The Obama plan would cut taxes for 95% of workers and their families with a tax cut of $500 for workers or $1,000 for working couples. In addition, Sen. Obama is proposing tax cuts for low- and middle-income seniors, homeowners, the uninsured, and families sending a child to college or looking to save and accumulate wealth. The Obama plan would dramatically simplify taxes by consolidating existing tax credits, eliminating the need for millions of senior citizens to file tax forms, and enabling as many as 40 million middle-class filers to do their own taxes in less than five minutes and not have to hire an accountant. Sen. Obama also recognizes that small businesses are the engine of job growth in the economy. That is why he is proposing additional tax cuts, including a tax credit for small businesses that provide health care, and the elimination of capital gains taxes for small businesses and start-ups. The vast majority of small businesses would face lower taxes under the Obama plan than under the McCain plan. In addition, Sen. Obama supports reforming corporate taxes in a manner that would help create jobs in America and simplify the tax code by eliminating distortions and special preferences. Sen. Obama believes that responsible candidates must put forward specific ideas of how they would pay for their proposals. That is why he would repeal a portion of the tax cuts passed in the last eight years for families making over $250,000. But to be clear: He would leave their tax rates at or below where they were in the 1990s. - The top two income-tax brackets would return to their 1990s levels of 36% and 39.6% (including the exemption and deduction phase-outs). All other brackets would remain as they are today. - The top capital-gains rate for families making more than $250,000 would return to 20% -- the lowest rate that existed in the 1990s and the rate President Bush proposed in his 2001 tax cut. A 20% rate is almost a third lower than the rate President Reagan set in 1986. - The tax rate on dividends would also be 20% for families making more than $250,000, rather than returning to the ordinary income rate. This rate would be 39% lower than the rate President Bush proposed in his 2001 tax cut and would be lower than all but five of the last 92 years we have been taxing dividends. - The estate tax would be effectively repealed for 99.7% of estates, and retained at a 45% rate for estates valued at over $7 million per couple. This would cut the number of estates covered by the tax by 84% relative to 2000. Overall, in an Obama administration, the top 1% of households -- people with an average income of $1.6 million per year -- would see their average federal income and payroll tax rate increase from 21% today to 24%, less than the 25% these households would have paid under the tax laws of the late 1990s. Sen. Obama believes that one of the principal problems facing the economy today is the lack of discretionary income for middle-class wage earners. That's why his plan would not raise any taxes on couples making less than $250,000 a year, nor on any single person with income under $200,000 -- not income taxes, capital gains taxes, dividend or payroll taxes. In contrast, Sen. McCain's tax plan largely leaves the middle class behind. His one and only middle-class tax cut -- a slow phase-in of a bigger dependent exemption -- would provide no benefit whatsoever to 101 million families who do not have children or other dependents, or who have a low income. But Sen. McCain's plan does include one new proposal that would result in higher taxes on the middle class. As even Sen. McCain's advisers have acknowledged, his health-care plan would impose a $3.6 trillion tax increase over 10 years on workers. Sen. McCain's plan will count the health care you get from your employer as if it were taxable cash income. Even after accounting for Sen. McCain's proposed health-care tax credits, this plan would eventually leave tens of millions of middle-class families paying higher taxes. In addition, as the Congressional Budget Office has shown, this kind of plan would push people into higher tax brackets and increase the taxes people pay as their compensation rises, raising marginal tax rates by even more than if we let the entire Bush tax-cut plan expire tomorrow. The McCain plan represents Bush economics on steroids. It has $3.4 trillion more in tax cuts than President Bush is proposing, largely directed at corporations and the most affluent. Sen. McCain would implement these cuts without proposing any meaningful steps to simplify taxes or eliminate distortions and loopholes. In addition, Sen. McCain has floated over $1 trillion in new spending increases but barely any specific spending cuts. As previously mentioned, the Obama plan is a net tax cut -- his middle-class tax cuts are larger than the rollbacks he has proposed for families making over $250,000. Sen. Obama would pay for this tax cut by cutting spending -- including responsibly ending the war in Iraq, reducing excessive payments to private plans in Medicare, limiting payments for high-income farmers, reducing subsidies for banks that make student loans, reforming earmarks, ending no-bid contracts, and eliminating other wasteful and unnecessary programs. While Sen. Obama would shrink the deficit from its current record levels, he recognizes that it is even more important to confront our long-term fiscal challenges, including the growth of health costs in the public and private sector. He also believes it is critical to work with members of Congress from both parties to strengthen Social Security while protecting middle-class families from tax increases or benefit cuts. He has done what few presidential candidates have been willing to do by making a politically risky proposal to strengthen solvency by asking those making over $250,000 to contribute a bit more to Social Security to keep it sound. Sen. Obama does not support uncapping the full payroll tax of 12.4% rate. Instead, he is considering plans that would ask those making over $250,000 to pay in the range of 2% to 4% more in total (combined employer and employee). This change to Social Security would start a decade or more from now and is similar to the rate increases floated by Sen. McCain's close adviser Lindsey Graham, and that Sen. McCain has previously said he "could" support. In contrast, Sen. McCain has put forward the most fiscally reckless presidential platform in modern memory. The likely results of his Bush-plus policies are clear. As Berkeley economist Brad Delong has estimated, the McCain plan, as compared to the Obama plan, would lower annual incomes by $300 billion or more in real terms by 2017, costing the typical worker $1,800 or more due to the effect of large deficits on national savings and thus capital formation. Sen. McCain's neglect of critical public investments would further impede economic growth for decades to come. Do not take the critics' word for it. Go look at the plans for yourself at www.barackobama.com/taxes1. Get the facts and you will see the real priorities at stake in this election. America cannot afford | |||||||
Showing posts with label taxes. Show all posts
Showing posts with label taxes. Show all posts
Sunday, August 24, 2008
Obama's tax ideas to save a country...
Friday, June 6, 2008
Taxation without Representation...Exit Tax
This was one of our first founding father's statement or mantra that ended the reign and the sell off of England by the pound. Today's title represents just how far we have NOT come in the past 250 years.
The U.S. has always tried to keep the slaves on the "Plantation". Throughout the 1600's, 1700's, even on past the 1860's and emancipation, on through the 1960's, to today the worlds most powerful international families have set a highly orchestrated agenda to keep the facade of freedom while hording the funds. Well, this may well be the icing on the cake.
Some people say that if you don't like what happening here, then leave. Well, it may not be that simple any longer. I came across some interesting information lately as I begin to plan ahead. I have been saying that if McCain wins in Nov. I will be ready to leave...I don't know if I can take it any more...
However...just when they know that I am thinking this, they throw in this one!!
The United States is the only major country on the planet that taxes citizens on their worldwide income, no matter where those citizens happen to live. It's not like that everywhere else. If you were born in England, Ireland, Japan, or almost any other country, all you need to do to avoid the obligation to pay tax on your worldwide income is leave. The money you make outside of your home country can be tax exempt. Why not just move somewhere else. Want to stop paying taxes? Simply pick up and move again. Then after an extended period, sometime around a year or so, you no longer have any obligation to pay taxes on your income outside that country. There may be some taxes such as a gift tax or estate tax.
No longer in the good ole' United State. In order to permanently remove yourself from U.S. tax obligations, one must not only leave the United States, but also take the radical step of giving up U.S. citizenship. This process (from a U.S. standpoint) is called expatriation. The income tax savings from expatriation can be huge. But, of course, this is only for truly wealthy U.S. citizens, and the biggest savings from expatriation come after they die.
In fact, the tax savings makes a wealthy U.S. expat as fortunate as wealthy foreigners when it comes to estate taxes. To dissect this we will look at an Irish citizen died this year after relocating to Italy two years ago. After living outside Ireland at the time of death, the US$1 billion estate pays zero gift and estate tax for all bequests outside of Ireland.
Now, let's say a U.S. person died with a US$1 billion estate this year, after relocating to Hong Kong back in 2000. Even though this wealthy businessman lived and died outside the U.S., his estate would still have to pay a maximum combined gift and estate tax burden exceeding US$450 million.
The arithmetic is nearly as compelling for smaller estates. An entrepreneur with a US$20 million estate could save over US$8 million in estate and gift taxes by giving up U.S. citizenship.
However, the image of wealthy former U.S. citizens living tax-free in tropical paradises is an irresistible populist target. The result has been a series of increasingly stringent laws that penalize U.S. citizens who give up their U.S. citizenship with "tax avoidance" as a principal purpose. Leave the USA, Pay an "Exit Tax"
Congress has amended these "anti-expatriation" provisions once again in a new bill. Both houses approved the bill unanimously, and sent it to President Bush for his signature.
The primary purpose of the Heroes Earnings Assistance and Relief Tax Act of 2008 is to provide a range of tax breaks for veterans. But the law also imposes the first-ever "exit tax" on even moderately wealthy expatriates. Mark Nestmann, a wealth preservation and tax consultant and President of The Nestmann Group, predicted Congress could pass an exit tax bill like this over a year ago, and now they have.
Once President Bush signs this bill, the law will require future expatriates to pay a tax on all unrealized gains of their worldwide estate, including most offshore trusts. And the tax applies not only to former U.S. citizens, but also to long-term green card holders who have resided in the United States for at least eight of the 15 years before they expatriate. (Fortunately, long-term residents can "opt out" of the exit tax, as I'll explain in a moment.)
How are you supposed to pay the tax without selling your assets? That's your problem, although the bill permits deferral in certain circumstances, but either way, the IRS doesn't care. Needless to say you don't need to be "rich" to pay the "exit tax".
It would be one thing if the exit tax only affected billionaires. But, with only a few exceptions for dual nationals and others with strong ties to another country, the law applies to any expatriate that:
1. Has an average annual net income tax liability that exceeds US$139,000 adjusted annually for inflation for the five preceding years ending before the date you lose your U.S. citizenship or terminate your residency
2. Has a net worth of US$2 million or more on such date
3. Fails to certify under penalty of perjury that he or she has complied with all U.S. federal tax obligations for the preceding five years or fails to submit any proof of compliance the IRS demands
If you qualify under any of these criteria, you may be subject to the exit tax. The good news, if there is any, is that the first US$600,000 of gains is excluded. This exclusion doubles to US$1.2 million for a married couple filing jointly, when both expatriate. This exclusion will increase by a cost of living adjustment factor after 2008.
Gains will be calculated "mark-to-market," or the difference between the market value on the expatriation date and the market value at acquisition. Expatriates who were not born in the United States may elect to value their property at its fair market value on the date they first became a U.S.resident, rather than when they first acquired it.
This phantom gain will presumably be taxed as ordinary income (at rates as high as 35%) or capital gains (at either a 15%, 25%, or 28% rate), as provided under current law. When you actually sell the assets, you won't have to pay any additional taxes. However, your adopted country might tax the gain a second time, leading to double taxation on the same income.
Now for the really bad news. Once you expatriate, you'll pay up to a 51% tax on distributions from retirement plans. The same goes for most other forms of deferred payments. If there's a silver lining, it's that the tax isn't due until you actually receive payments from the plan.
Plans covered by this provision include:
* Qualified pension, profit sharing and stock bonus plans
* Qualified annuity plans
* Federal pension plans
* Simplified employee pension plans
* Simplified retirement accounts
The IRS imposes this extra 51% tax on these plans in two steps. First of all, the entity that makes the payment (like your pension fund) must withhold a 30% tax from any distributions to a "covered expatriate." That entity must also withhold a second 30% tax for payments to a "non-resident alien individual." Applying these two taxes sequentially equals a 51% net tax.
Similar rules (but with some added complexities) apply for distributions from non-grantor trusts. These are trusts where the expatriate isn't even treated as the trust's owner under the grantor trust rules.
Your individual retirement account is NOT eligible for this treatment. If you're a "covered expatriate," you must pay income tax on the entire value of the plan, as if you received it in a lump sum. (Fortunately, no "early distribution" tax applies if you're under age 59 1/2.)
You'd think the United States would encourage wealthy foreigners to make payments to persons in the United States. After all, any beneficiaries in the U.S. would presumably spend that money on U.S. goods and services.
But if you're a covered expatriate, and you make a gift or bequest to a U.S. person 10, 15, or even 50 years after your expatriation, the recipient must withhold tax at the highest marginal gift or estate tax rate that applies. Exactly how much tax you pay depends on the amount of gift or estate tax paid to a foreign country with respect to that gift or bequest.
Can you avoid the tax? Perhaps...If your net worth is only a little over US$2 million (US$4 million for a married couple expatriating at the same time), the most obvious way to avoid the exit tax is to spend enough money to get your net worth under these thresholds. This could actually be fun, too. Take a trip around the world. Blow some money in Las Vegas. Throw a really big party.
You can also contribute your excess funds to a qualified charity, or give away up to US$1 million over your lifetime to anyone else without triggering a gift tax liability.
If you've paid more than an average of US$139,000 annually for the previous five years, however, this strategy won't work. And if you don't have sufficient cash to pay the exit tax, your best option may be to elect to defer payment. You'll pay interest for the period tax is deferred, and you may be required to post a bond with the Treasury Department.
Fortunately, you can make this election (which is irrevocable) on a property-by-property basis. For instance, it appears as if you could pay the exit tax on all assets outside your IRA, and defer it for the assets in the IRA.
If you weren't born in the United States, you have a couple of additional options.
* If you were born with citizenship both in the United States and another country, you may not be subject to the exit tax. To qualify for this exemption, when you expatriate, you must also be a citizen of another country (and taxed by another country), and not been a U.S. resident for more than 10 years during the 15-year period prior to your expatriation.
* If you're a green card holder, you can opt out of the exit tax. To do so, you must become resident for tax purposes in a foreign country that has a tax treaty with the United States. You must also inform the IRS of your intention not to waive the benefits of the tax treaty applicable to that country.
The bottom line: with the exit tax, Congress has made the most significant change to the anti-expatriation rules since their inception in 1966. In doing so, the IRS has sent wealthy U.S. citizens and long-term residents a clear message: You're slaves on our plantation. And if you want to exercise your right to leave, you'll pay dearly for the privilege.
Is expatriation for you? The decision to give up U.S. citizenship is a serious one. It requires that you obtain a passport from another country, leave the United States permanently, and set up residence in a suitable jurisdiction. It's a step you should take only after consulting with your family and professional advisors. But it's the only way that U.S. citizens and long-term residents can eliminate U.S. tax liability on their non-U.S. income, wherever they live. And it's a tax avoidance option that Congress has now made much more difficult.
What is next on the agenda?
This entry is heavily drawn with information and context from Mark Nestmann, a wealth preservation and tax consultant and President of The Nestmann Group, for the Sovereign Society.
The U.S. has always tried to keep the slaves on the "Plantation". Throughout the 1600's, 1700's, even on past the 1860's and emancipation, on through the 1960's, to today the worlds most powerful international families have set a highly orchestrated agenda to keep the facade of freedom while hording the funds. Well, this may well be the icing on the cake.
Some people say that if you don't like what happening here, then leave. Well, it may not be that simple any longer. I came across some interesting information lately as I begin to plan ahead. I have been saying that if McCain wins in Nov. I will be ready to leave...I don't know if I can take it any more...
However...just when they know that I am thinking this, they throw in this one!!
The United States is the only major country on the planet that taxes citizens on their worldwide income, no matter where those citizens happen to live. It's not like that everywhere else. If you were born in England, Ireland, Japan, or almost any other country, all you need to do to avoid the obligation to pay tax on your worldwide income is leave. The money you make outside of your home country can be tax exempt. Why not just move somewhere else. Want to stop paying taxes? Simply pick up and move again. Then after an extended period, sometime around a year or so, you no longer have any obligation to pay taxes on your income outside that country. There may be some taxes such as a gift tax or estate tax.
No longer in the good ole' United State. In order to permanently remove yourself from U.S. tax obligations, one must not only leave the United States, but also take the radical step of giving up U.S. citizenship. This process (from a U.S. standpoint) is called expatriation. The income tax savings from expatriation can be huge. But, of course, this is only for truly wealthy U.S. citizens, and the biggest savings from expatriation come after they die.
In fact, the tax savings makes a wealthy U.S. expat as fortunate as wealthy foreigners when it comes to estate taxes. To dissect this we will look at an Irish citizen died this year after relocating to Italy two years ago. After living outside Ireland at the time of death, the US$1 billion estate pays zero gift and estate tax for all bequests outside of Ireland.
Now, let's say a U.S. person died with a US$1 billion estate this year, after relocating to Hong Kong back in 2000. Even though this wealthy businessman lived and died outside the U.S., his estate would still have to pay a maximum combined gift and estate tax burden exceeding US$450 million.
The arithmetic is nearly as compelling for smaller estates. An entrepreneur with a US$20 million estate could save over US$8 million in estate and gift taxes by giving up U.S. citizenship.
However, the image of wealthy former U.S. citizens living tax-free in tropical paradises is an irresistible populist target. The result has been a series of increasingly stringent laws that penalize U.S. citizens who give up their U.S. citizenship with "tax avoidance" as a principal purpose. Leave the USA, Pay an "Exit Tax"
Congress has amended these "anti-expatriation" provisions once again in a new bill. Both houses approved the bill unanimously, and sent it to President Bush for his signature.
The primary purpose of the Heroes Earnings Assistance and Relief Tax Act of 2008 is to provide a range of tax breaks for veterans. But the law also imposes the first-ever "exit tax" on even moderately wealthy expatriates. Mark Nestmann, a wealth preservation and tax consultant and President of The Nestmann Group, predicted Congress could pass an exit tax bill like this over a year ago, and now they have.
Once President Bush signs this bill, the law will require future expatriates to pay a tax on all unrealized gains of their worldwide estate, including most offshore trusts. And the tax applies not only to former U.S. citizens, but also to long-term green card holders who have resided in the United States for at least eight of the 15 years before they expatriate. (Fortunately, long-term residents can "opt out" of the exit tax, as I'll explain in a moment.)
How are you supposed to pay the tax without selling your assets? That's your problem, although the bill permits deferral in certain circumstances, but either way, the IRS doesn't care. Needless to say you don't need to be "rich" to pay the "exit tax".
It would be one thing if the exit tax only affected billionaires. But, with only a few exceptions for dual nationals and others with strong ties to another country, the law applies to any expatriate that:
1. Has an average annual net income tax liability that exceeds US$139,000 adjusted annually for inflation for the five preceding years ending before the date you lose your U.S. citizenship or terminate your residency
2. Has a net worth of US$2 million or more on such date
3. Fails to certify under penalty of perjury that he or she has complied with all U.S. federal tax obligations for the preceding five years or fails to submit any proof of compliance the IRS demands
If you qualify under any of these criteria, you may be subject to the exit tax. The good news, if there is any, is that the first US$600,000 of gains is excluded. This exclusion doubles to US$1.2 million for a married couple filing jointly, when both expatriate. This exclusion will increase by a cost of living adjustment factor after 2008.
Gains will be calculated "mark-to-market," or the difference between the market value on the expatriation date and the market value at acquisition. Expatriates who were not born in the United States may elect to value their property at its fair market value on the date they first became a U.S.resident, rather than when they first acquired it.
This phantom gain will presumably be taxed as ordinary income (at rates as high as 35%) or capital gains (at either a 15%, 25%, or 28% rate), as provided under current law. When you actually sell the assets, you won't have to pay any additional taxes. However, your adopted country might tax the gain a second time, leading to double taxation on the same income.
Now for the really bad news. Once you expatriate, you'll pay up to a 51% tax on distributions from retirement plans. The same goes for most other forms of deferred payments. If there's a silver lining, it's that the tax isn't due until you actually receive payments from the plan.
Plans covered by this provision include:
* Qualified pension, profit sharing and stock bonus plans
* Qualified annuity plans
* Federal pension plans
* Simplified employee pension plans
* Simplified retirement accounts
The IRS imposes this extra 51% tax on these plans in two steps. First of all, the entity that makes the payment (like your pension fund) must withhold a 30% tax from any distributions to a "covered expatriate." That entity must also withhold a second 30% tax for payments to a "non-resident alien individual." Applying these two taxes sequentially equals a 51% net tax.
Similar rules (but with some added complexities) apply for distributions from non-grantor trusts. These are trusts where the expatriate isn't even treated as the trust's owner under the grantor trust rules.
Your individual retirement account is NOT eligible for this treatment. If you're a "covered expatriate," you must pay income tax on the entire value of the plan, as if you received it in a lump sum. (Fortunately, no "early distribution" tax applies if you're under age 59 1/2.)
You'd think the United States would encourage wealthy foreigners to make payments to persons in the United States. After all, any beneficiaries in the U.S. would presumably spend that money on U.S. goods and services.
But if you're a covered expatriate, and you make a gift or bequest to a U.S. person 10, 15, or even 50 years after your expatriation, the recipient must withhold tax at the highest marginal gift or estate tax rate that applies. Exactly how much tax you pay depends on the amount of gift or estate tax paid to a foreign country with respect to that gift or bequest.
Can you avoid the tax? Perhaps...If your net worth is only a little over US$2 million (US$4 million for a married couple expatriating at the same time), the most obvious way to avoid the exit tax is to spend enough money to get your net worth under these thresholds. This could actually be fun, too. Take a trip around the world. Blow some money in Las Vegas. Throw a really big party.
You can also contribute your excess funds to a qualified charity, or give away up to US$1 million over your lifetime to anyone else without triggering a gift tax liability.
If you've paid more than an average of US$139,000 annually for the previous five years, however, this strategy won't work. And if you don't have sufficient cash to pay the exit tax, your best option may be to elect to defer payment. You'll pay interest for the period tax is deferred, and you may be required to post a bond with the Treasury Department.
Fortunately, you can make this election (which is irrevocable) on a property-by-property basis. For instance, it appears as if you could pay the exit tax on all assets outside your IRA, and defer it for the assets in the IRA.
If you weren't born in the United States, you have a couple of additional options.
* If you were born with citizenship both in the United States and another country, you may not be subject to the exit tax. To qualify for this exemption, when you expatriate, you must also be a citizen of another country (and taxed by another country), and not been a U.S. resident for more than 10 years during the 15-year period prior to your expatriation.
* If you're a green card holder, you can opt out of the exit tax. To do so, you must become resident for tax purposes in a foreign country that has a tax treaty with the United States. You must also inform the IRS of your intention not to waive the benefits of the tax treaty applicable to that country.
The bottom line: with the exit tax, Congress has made the most significant change to the anti-expatriation rules since their inception in 1966. In doing so, the IRS has sent wealthy U.S. citizens and long-term residents a clear message: You're slaves on our plantation. And if you want to exercise your right to leave, you'll pay dearly for the privilege.
Is expatriation for you? The decision to give up U.S. citizenship is a serious one. It requires that you obtain a passport from another country, leave the United States permanently, and set up residence in a suitable jurisdiction. It's a step you should take only after consulting with your family and professional advisors. But it's the only way that U.S. citizens and long-term residents can eliminate U.S. tax liability on their non-U.S. income, wherever they live. And it's a tax avoidance option that Congress has now made much more difficult.
What is next on the agenda?
This entry is heavily drawn with information and context from Mark Nestmann, a wealth preservation and tax consultant and President of The Nestmann Group, for the Sovereign Society.
Wednesday, June 4, 2008
Keep them down...
The United States is the only major country on the planet that taxes citizens on their worldwide income, no matter where those citizens happen to live.
How is that one! But, wait my wealthy friends, this does not mean you! More on this a little later, but first I wanted to discuss another fact.
The IRS had decided to audit more small businesses and reduce the audits to large businesses thereby making the small businessman that many more obstacles to try to overcome in order to maintain a livelyhood.
The IRS recently made an incredible and inexplicable decision to increase audits of small companies while easing up on the large firms. In fact, the smallest companies saw the taxman 41% more often in 2007 than in 2005, and companies with $10 million to $50 million in assets were 29% more likely to be investigated, according to a new study from Syracuse University.
Meanwhile, companies with more than $250 million in assets were almost 40% less likely to be audited than in previous years - even though an average audit hour of large firms earned the IRS about $7,500, the Syracuse study found, while a similar hour directed at smaller companies turned up $474. Now, keep in mind that an audit takes more than an hour.
Why did this take place? Because the larger corporations have lawyers and accountants that they can afford to pay to drag out an audit for years, while the small company does not. If the IRS is being told by the House Ways and Means Committee to increase their audit returns, their only way of doing this is to make sure that these audits get completed. Hereby, get the guy without representation.
It's a sad reality that the IRS is picking on the smallest of businesses when neither they, nor the country, can afford it. We are over $3 Trillion in debt now due to this administration. The Syracuse study found a 20% reduction in large-business tax underpayments caught by the IRS, from about $30 billion to some $24 billion, between 2005 and 2007. Just last month the Wall Street Journal reported that a Dutch bank is under investigation for allegedly helping big U.S. corporations save at least $1.46 billion in U.S. taxes through highly complex tax shelters. This is a situation the IRS scrutinized only after a whistleblower came forward.
That's a poor approach for a collection service charged with closing the $290 billion gap between the amount of taxes owed and the amount paid.
Tomorrow I will discuss issues on how the United States is the only major country on the planet that taxes citizens on their worldwide income, no matter where those citizens happen to live. So, whether you like it here or not, you will pay no matter if you leave or stay...
Double taxation without representation...Remember the Boston Tea Party? I thought we did away with all of that.
How is that one! But, wait my wealthy friends, this does not mean you! More on this a little later, but first I wanted to discuss another fact.
The IRS had decided to audit more small businesses and reduce the audits to large businesses thereby making the small businessman that many more obstacles to try to overcome in order to maintain a livelyhood.
The IRS recently made an incredible and inexplicable decision to increase audits of small companies while easing up on the large firms. In fact, the smallest companies saw the taxman 41% more often in 2007 than in 2005, and companies with $10 million to $50 million in assets were 29% more likely to be investigated, according to a new study from Syracuse University.
Meanwhile, companies with more than $250 million in assets were almost 40% less likely to be audited than in previous years - even though an average audit hour of large firms earned the IRS about $7,500, the Syracuse study found, while a similar hour directed at smaller companies turned up $474. Now, keep in mind that an audit takes more than an hour.
Why did this take place? Because the larger corporations have lawyers and accountants that they can afford to pay to drag out an audit for years, while the small company does not. If the IRS is being told by the House Ways and Means Committee to increase their audit returns, their only way of doing this is to make sure that these audits get completed. Hereby, get the guy without representation.
It's a sad reality that the IRS is picking on the smallest of businesses when neither they, nor the country, can afford it. We are over $3 Trillion in debt now due to this administration. The Syracuse study found a 20% reduction in large-business tax underpayments caught by the IRS, from about $30 billion to some $24 billion, between 2005 and 2007. Just last month the Wall Street Journal reported that a Dutch bank is under investigation for allegedly helping big U.S. corporations save at least $1.46 billion in U.S. taxes through highly complex tax shelters. This is a situation the IRS scrutinized only after a whistleblower came forward.
That's a poor approach for a collection service charged with closing the $290 billion gap between the amount of taxes owed and the amount paid.
Tomorrow I will discuss issues on how the United States is the only major country on the planet that taxes citizens on their worldwide income, no matter where those citizens happen to live. So, whether you like it here or not, you will pay no matter if you leave or stay...
Double taxation without representation...Remember the Boston Tea Party? I thought we did away with all of that.
Subscribe to:
Posts (Atom)
