This story first appeared at ProPublica. ProPublica is a Pulitzer Prize-winning investigative newsroom. Sign up for The Big Story newsletter to receive stories like this one in your inbox.
If any of you all are surprised by this, I have a bridge for sale that you are welcomed to take a huge, tax-sheltered loss on…
Most laymen fail to grasp that the amount of money is secondary to the power it brings.
“Avoided” ??
Oh, you mean “Evaded.”
You mean there are perks for the rich in an oligarchical society?
Most wealthy types live off lines of credit. No income no tax. Of course getting tip money from wait staffs keeps the IRS busy.
This is why their errand boys in the GQP have consistently tried to drown the IRS in a bathtub after accusing them of doing their jobs.
“I lose bigly. I have the best losses.”
Does anyone believe that Donald Trump is “ultra rich”?
Or a bigly Atlantic City casino or two?
Eat them all alive.
NMNQ
Well at least the oil tycoons weren’t also being subsidized by taxpay-- oh, shit.
To repeat an old adage, the outrage isn’t what’s illegal, it’s what’s legal while being unethical. This is Exhibit A in a country with huge budget deficits and increasing income inequality, and people who believe the system is stacked against them have a solid claim.
Unpopular opinion, but I have a real problem with the way ProPublica uses these returns it’s acquired somehow to cover tax policy issues. Excoriating people for taking legal deductions because they’re rich is cheap left wing populism bordering on demagoguery.
If they want to scour through the returns to figure out how the laws and shelters work, fine. If they want to say, “here’s how the loophole works” then “for example, billionaire a had gross income of x but paid no taxes using this shelter,” fine. If someone is taking what tax layers call “an aggressive position” supported by the least protective level of opinion of counsel letter (the kind that basically says “you probably won’t go to prison for taking this position, although only because I wrote this letter for you”) by all means expose them.
And above all, if they want to focus on how these loopholes got into the tax code, who pushed them, who uses campaign dollar leverage to ensure they stay there, well, that’s actually what they should be doing.
Attacking people for taking advantage of straight-forward application of the existing tax laws is wrong, no matter how few tears you shed for them personally.
And this isn’t the first time they’ve done this. It’s like they’re so pleased with themselves for getting their hands on these returns (and be aware someone committed a felony to give them to them) they just can’t resist personalizing what should be a policy story.
There is a place for elaborate, lawyerly deconstruction of tax policy: in the tax periodicals for academics and lawyers, and in Congress. There is also a place for drumming up popular outrage at the abuses permitted, and encouraged, by the system. Without a sufficient amount of public outrage, the system will never change for the better.
Keep focus fire on the congress critters.
I myself experienced some of the weirdness of real estate financing and personal income tax. I was a student, my wife had just graduated and gotten a teaching job. We lived in a coop that was subsidized. That meant I bought my “shares” at a subsidized price and my monthly maintenance cost was subsidized, too. But as a shareholder, a fraction of the coop’s mortgage interest and its real estate taxes were “attributable” to me. The dollar value of these “expenses” [which we did not pay personally] exceeded by far what we paid out in maintenance each year and reduced our income taxes to next to nothing. So far as my taxes were concerned, I was loosing money but it was someone else’s money.
When we moved out the coop bought back our shares for exactly what we’d paid for them.
Except I didn’t call for “elaborate, lawyerly deconstruction.” I called for attacking the people responsible for the policy, and even those abusing it, rather than those legally benefitting from it. Because we had four years to see how that kind of status-based demonization is intrinsic to populist authoritarianism.
Real Estate Depreciation is the biggest myth of them all. Right now you can depreciate a building down to zero in 15 years, when, in fact, the building is worth much more than when it was built or purchased. If the IRS only required that the the claimed “depreciation” matched the history of the property’s valuation based on state or local real estate tax records, it would go a long way to resolving this issue.
WRT the fossil fuel industry, any and all tax breaks for taking fossil fuel out of the ground should be immediately stopped. Nothing has caused more problems for humanity than these activities which we have subsidized through the tax code for over 100 years. It is long past time to end these gas, oil and coal subsidies.
We have enough money to live happily and modestly. Don’t understand the amassing of wealth for it’s own sake.
Especially at someone else’s expense.