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Old 03-14-2019, 03:07 PM   #81
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The subject was income taxes, not social security or Medicare taxes.

Let's say that employer pays employee $100 of wages. Employee is in the 22% tax bracket and pays $22 in taxes on $100 of income. Employer gets a $100 deduction and get $21 tax benefit as a result.

Net impact is $1 of tax paid.... $22 paid by employee less $21 tax benefit employer receives.... seems like hardly taxed at all to me.
The thing is, without the employees, the business would not have *any* profit to tax. Most of them could not remain in business. And would pay no tax, not just 79% of their gross profit minus employee wages.
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Old 03-14-2019, 03:08 PM   #82
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And a retired couple with otherwise a net worth of only $6.5M is going to own one of those?

The bit about buying a home for $200K in 1999 and appreciating to $1.5M today in Austin is extremely unrealistic.
Agreed. My old house in that area has barely doubled since I bought it in 2003, so increasing 7.5 times in 4 more years is not likely.
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Old 03-14-2019, 03:12 PM   #83
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Agreed. My old house in that area has barely doubled since I bought it in 2003, so increasing 7.5 times in 4 more years is not likely.
Austin real estate was hit very hard by the dot com bust. So my guess is at best no appreciation between 1999 and 2003. When I sold my Austin home in 2005, Austin real estate had just finally crawled out of the dot com bust.
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Old 03-14-2019, 03:14 PM   #84
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Agreed. My old house in that area has barely doubled since I bought it in 2003, so increasing 7.5 times in 4 more years is not likely.
Even California homes haven't gone up sevenfold in that time.

We bought a home in San Jose -- one of the craziest markets and the most expensive metro in the country now-- in 1997 for $239K. We sold it for $440K in 2003. (Oops.) Last I saw recently, it's estimated at close to a million, about $950K. That's about a 4x increase since 1997.

Ouch, we left a lot on the table! But things have worked out well for us since, in a lot of ways, so we still feel blessed.
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Old 03-14-2019, 03:20 PM   #85
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The thing is, without the employees, the business would not have *any* profit to tax. Most of them could not remain in business. And would pay no tax, not just 79% of their gross profit minus employee wages.
I agree and didn't say anything to the contrary so I'm not sure what your point is.

My point was that payment of wages is pretty tax neutral to the government overall.
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Old 03-14-2019, 03:39 PM   #86
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J

<SNIP>

At 65, they will take out the minimum required distribution which would be somewhat offset by a nice standard deduction and maybe some direct charitable contribution out of the retirement funds. due.
I got bored reading this thread, so maybe someone already addressed this from OP. RMDs don't kick in until one reaches the year they turn 70 1/2.

Still unsure the reason for the thread. If anyone wants to "complain" about something, I think it would be the way taxes are spent - but Porky would soon appear as there is no possible obscure, esoteric, half-baked, hair-brained, use of taxes that SOMEONE doesn't think is a great idea, so YMMV.
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Old 03-15-2019, 09:12 AM   #87
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Reason for the thread I dunno, it's wintertime and for some of us it's been a LOOOONG winter.

Maybe the OP was just looking for some entertainment...
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Old 03-15-2019, 10:23 AM   #88
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Seems to be the OP's hot button topic, and probably not the last thread he'll open on it.
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Old 03-15-2019, 02:25 PM   #89
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Seems to be the OP's hot button topic, and probably not the last thread he'll open on it.
Give it about 3 months, or if there is some change to the ACA rules.
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Old 03-15-2019, 04:07 PM   #90
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And a retired couple with otherwise a net worth of only $6.5M is going to own one of those?



The bit about buying a home for $200K in 1999 and appreciating to $1.5M today in Austin is extremely unrealistic.


That bit is unrealistic anywhere. We sold a townhouse in Sunnyvale for $360K and 20 yrs later it’s worth $1.5 million on Zillow.
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Old Today, 03:30 PM   #91
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Maybe the son who getting all the assets tax free (income and Estate) can give them some tax free gift as well.
I wonder if that is possible. Pass on the assets as a gift and then let the recipient gift back to you what you need to live on. My guess is the cost basis is passed on as well so when the recipient sells they have to pay LTCG?
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Old Today, 03:45 PM   #92
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Makes me feel guilty. Haven't paid taxes since 1995 (legally). Now, don't even have to file.

thank you all for your support.
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Old Today, 04:11 PM   #93
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Well turned out John and Sarah decided to take a vacation to Canada, to escape the heat of TX in the Summer.
There they bought a lottery ticket, and won $200 Million CDN, which is worth $150 Million USD.
Quickly, they decided to become residents, and stayed in Canada for 6 months, before collecting their $200 Million CDN tax free as Canada does not tax lottery winnings.

Now the IRS has sent them a letter, asking them to return and pay over $65 Million USD in taxes, but they burned it in the campfire and are hiding out up North... with champagne.
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Old Today, 04:21 PM   #94
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So, if Meghan and Harry were to have a child it woild automatically a US citizen. Harry’s family has a lot of money, and at some future moment some of that money would correspond to the child. While an inheritance is not subject to US federal taxation, the income it produces would be. Depending on the circumstances, that might mean the US is taxing UK royal family income. That could get sticky.

I wonder how Meghan intends to deal with FATCA and the FBAR.
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Old Today, 04:26 PM   #95
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So, if Meghan and Harry were to have a child it woild automatically a US citizen. Harry’s family has a lot of money, and at some future moment some of that money would correspond to the child. While an inheritance is not subject to US federal taxation, the income it produces would be. Depending on the circumstances, that might mean the US is taxing UK royal family income. That could get sticky.
Interesting point. It would get sticky if it were you or me.

I could be wrong but I would suspect that that has already been figured out and ummm... 'addressed' well ahead of the pending birth. That's what good the best accountants money can buy are for.
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Old Today, 04:29 PM   #96
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My wife and I live in TX and the RE taxes are quite high. We've thought of TN often as a place to move. Of course, two of our five children and one of our two grandsons live in CO - which also has low property taxes. We have a low income - and nowhere near the assets outlined above, but we are comfortable.
I don't know. On the plus side, CO is closer to some of the kids.
On the negative side, CO is closer to some of the kids.
Maybe TN would be just right...
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Old Today, 04:32 PM   #97
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Please elaborate on that bit. I'd love to not pay taxes legally. Our US gov't really wants our money (it IS tax time). It's the old joke, right? "Hey there's a new simplified tax form. Two lines: How much did you make? Send it in!"
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