Taxes

[Legacy]

Taxes should be tied to performance of the federal government.

 

[Wild Bill]

This thread has potential.

 

[Irish YJ]

Taxes should be tied to performance of the federal government.

How about we tie politician pay to performance.

 

[Legacy]

Congress Set To Pass SECURE Act At Last Minute, Impacting Retirement Planning And Increasing Taxes (Forbes, Dec 16, 2019)

Congress just agreed to a bipartisan appropriations bill that will help avert another government shutdown. However, attached to the spending bill is a piece of legislation called the Setting Every Community Up for Retirement Enhancement Act (SECURE Act), which passed the House with a 417-3 vote earlier this summer.

Honestly, the passage of the SECURE Act came as a bit of a surprise as it appeared to be derailed during the fall. Now, just a few weeks before the end of the year, Congress is changing major tax laws implicating 2019 and especially 2020 going forward.

The most important provision of the SECURE Act – removal of the stretch RMD provisions – is a tax revenue generator, meaning a tax hike on many Americans. This goes into effect Jan. 1, 2020, assuming President Trump signs the bill into law, which seems all but a forgone conclusion.

The removal of the required minimum distribution (RMD) provisions for stretch IRAs for many beneficiaries will cause chaos for certain types of trusts written prior to this bill. Trusts written as so-called “pass-through trusts” could have to be reformed to match up with the current SECURE Act language. If not, existing trust language could restrict access to funds to heirs of trusts listed as the beneficiaries of IRAs and cause massive tax bills down the line.

Instead of being able to stretch RMDs out over the life of a beneficiary, many will have to take all RMDs of a retirement account by the end of year 10 after an account owner passes away. This can push higher RMDs into the prime working years – and highest tax years – of a beneficiary’s life. (cont)

New rules cut tax benefits to consumers in two primary ways:

Assets held in an inherited retirement account would have a shorter amount of time to grow on a tax-deferred basis, meaning overall account size would be smaller in most cases. Withdrawals will also be larger, since they’re compressed into a shorter frame of time, making it more likely that beneficiaries of a pre-tax account will be pushed into a higher income-tax bracket when they take distributions.

For example, the beneficiary of a $1 million account could withdraw roughly $33,000 a year over 30 years under current rules; however, that would be $100,000 a year under new rules.

“For most people, that would push them into a higher tax rate,” Hopkins said.

The Congressional Budget Office in April projected the elimination of stretch IRAs and workplace retirement plans would raise nearly $16 billion for the federal government over a decade.

(CNBC)

 

[Legacy]

Tis the season. Everyone should pay the Alternative Minimum Tax, not exempting people with failing businesses who write off debt and pay just $750. No exemptions, right?

 

[Black Irish]

Taxes should be tied to performance of the federal government.

That's tough. Like P.J. O'Rourke wrote in Parliament of Whores "The output of most government workers can't be measured, so they make up for in with input." Basically, positing that people in D.C. get up early and put in a lot of hours to look busy. I lived on the Beltway and I'm not sure that's the case. Most of those people didn't work that hard. And the only reason they were up at the crack of dawn was because of their hour to two hour commute coming from the VA suburbs into D.C.

 

[Fbolt]

F@ck this BS on an internet purchase. Just noticed this today for the first time.

State, City, and wtf is Special?

Subtotal	$88.00​
Shipping	$8.95​
VA STATE TAX	$3.78​
VA CITY TAX	$0.88​
VA SPECIAL TAX	$0.62​

Total

$102.23 USD​

 

[IRISHDODGER]

That's tough. Like P.J. O'Rourke wrote in Parliament of Whores "The output of most government workers can't be measured, so they make up for in with input." Basically, positing that people in D.C. get up early and put in a lot of hours to look busy. I lived on the Beltway and I'm not sure that's the case. Most of those people didn't work that hard. And the only reason they were up at the crack of dawn was because of their hour to two hour commute coming from the VA suburbs into D.C.

I need to re-read that book. I have it somewhere collecting dust. Whatever happened to PJ? I know he’s alive but miss his take on things.

 

[jprue24]

I need to re-read that book. I have it somewhere collecting dust. Whatever happened to PJ? I know he’s alive but miss his take on things.

He is not alive.

 

[IRISHDODGER]

He is not alive.

Damn, you’re correct. Looks like he died last year of lung cancer.

 

[IRISHDODGER]

 

[TorontoGold]

Judging by the guys Twitter account, this is panic people into buying more crypto.

If anyone truly believes that capital owners will just allow the government to seize their assets, they need to be checked into a mental institution ASAP. This is peak "If they come after the billionaires they're going to come after your parents 401K with $500k in it!!!".

Additionally, even the most progressive tax policies would not target an individuals 401k/IRA. If you're putting in the max every year, I can almost guarantee that there isn't a billionaire who holds more than a few million in these accounts.

 

[RDU Irish]

This doesn't even make sense. You get taxed on it when you take it out of the IRA/401k. RMDs and the new beneficiary rules force that money out to be taxed. Build too much in there and your RMDs will force you into a higher tax bracket.

 

[Irish#1]

https://www.cnn.com/2024/07/11/politics/irs-back-taxes-millionaires/index.html

 

[GATTACA!]

https://www.cnn.com/2024/07/11/politics/irs-back-taxes-millionaires/index.html

 

[NDVirginia19]

"IRS collected $1 billion in back taxes from millionaires in less than a year"

As a note: Liz Warren is touting this as a win for the increased funding they gave the IRS -- They gave the IRS $79 BILLION in increased funding to accomplish this, so a net $78 Billion loss to the American taxpayer

And

Two-Thirds of IRS initiated audits last year went towards households making less than $200K

I'm all for everybody paying their required taxes, but I wouldn't call this a "Win!" for the American people

 

[TorontoGold]

"IRS collected $1 billion in back taxes from millionaires in less than a year"

As a note: Liz Warren is touting this as a win for the increased funding they gave the IRS -- They gave the IRS $79 BILLION in increased funding to accomplish this, so a net $78 Billion loss to the American taxpayer

And

Two-Thirds of IRS initiated audits last year went towards households making less than $200K

I'm all for everybody paying their required taxes, but I wouldn't call this a "Win!" for the American people

Where are you getting this from lmao.

The IRS releases quarterly reports on IRA spending - so far they've spent $690M of the appropriated funds on enforcement. From FY22 to FY24. https://www.irs.gov/pub/irs-pdf/p5803.pdf

In FY2023 - the IRS spent $10.9B to recover $514M in taxes, a return of $4.7%. https://www.irs.gov/pub/irs-pdf/p5456.pdf

Since only two quarters have happened so far - double the FY24 funding ($392M x 2) $784M.

Projecting FY2024
Enforcement costs: $10.9B + 784M from the IRA funding - $11.68B
Taxes recovered: Let's be super conservative and just say $1B and IRS doesn't recover anything more this year.
Return for FY2024: $1B/$11.68B 8.56%

Surprise! Law enforcement does not have great returns, who would have guessed! But, to say $80B in funding is flatly wrong on it's face as it was reduced to ~$60B in January 2024. As well, of the ~$60B, ~$24B was allocated to enforcement so really not even close to what you're trying to say.

 

[Irish#1]

When I worked for Sallie Mae, we did a Tax Amnesty collection program for the State of Indiana. It ran like three months. Basically waived penalties and offered reduced amounts to tax payers to wipe the slate clean. It's been so long ago I can't remember how much was collected, but it was in the millions. When it was time to ask the governor for our collection fee, he basically told Sallie to F off! lol

The IRS goes after lower income families because it's easier to bully them and they know most can't afford an attorney to fight it.

 

[NDVirginia19]

Where are you getting this from lmao.

The IRS releases quarterly reports on IRA spending - so far they've spent $690M of the appropriated funds on enforcement. From FY22 to FY24. https://www.irs.gov/pub/irs-pdf/p5803.pdf

In FY2023 - the IRS spent $10.9B to recover $514M in taxes, a return of $4.7%. https://www.irs.gov/pub/irs-pdf/p5456.pdf

Since only two quarters have happened so far - double the FY24 funding ($392M x 2) $784M.

Projecting FY2024
Enforcement costs: $10.9B + 784M from the IRA funding - $11.68B
Taxes recovered: Let's be super conservative and just say $1B and IRS doesn't recover anything more this year.
Return for FY2024: $1B/$11.68B 8.56%

Surprise! Law enforcement does not have great returns, who would have guessed! But, to say $80B in funding is flatly wrong on it's face as it was reduced to ~$60B in January 2024. As well, of the ~$60B, ~$24B was allocated to enforcement so really not even close to what you're trying to say.

The "inflation reduction act" allocated $80B towards the IRS for enforcement purposes over a decade. So yes, only an additional $8B a year. That means that you can't really even claim that full $1B as a direct benefit of that $8B. From your source, that is absolutely ABYSMAL execution rates on their appropriations.

 

[TorontoGold]

The "inflation reduction act" allocated $80B towards the IRS for enforcement purposes over a decade. So yes, only an additional $8B a year. That means that you can't really even claim that full $1B as a direct benefit of that $8B. From your source, that is absolutely ABYSMAL execution rates on their appropriations.

You're just purposely ignoring the facts at this point.

1) It's 60B

IRS faces $20B cut from modernization fund under debt ceiling agreement

The IRS is facing substantial cuts to funds meant to rebuild its workforce and modernize its legacy IT systems over the next decade, as part of a deal to raise the debt ceiling and avoid a first-ever government default.

federalnewsnetwork.com

2) IRA was modernization and enforcement - you can see how the $60B (remember, not 80B) is allocated in what I previously cited that you somehow ignored
https://www.irs.gov/pub/irs-pdf/p5803.pdf

3) Do you know what the historical recovery rates are? I'm pretty sure you don't, so I've listed the rates below
2022- 5.11%
2021 - 5.45%
2020 - 3.55%
2019 - 5.10%
2018 - 5.30%

So yeah, it's a pretty substantial increase in recoveries and no, you're wrong that $80B was appropriated for enforcement. It's $24B.

What type of law enforcement agency has good returns on appropriations?