Why The Rich Get Richer... Congress Gives Them More Than We Regular Folks
America’s Most Coddled
That's right folks, those of us that put the sweat in sweat equity can pay as much as 35% to the tax man, but those of us that do nothing but deposit cash into already fat accounts pay 15%, or less if their funds manager is astute enough to use off-shore accounts, take advantage of tax write-offs, or use tax shelters in an efficient manner.
But you and I cannot take advantage of these very same loopholes, shelters and methods of defrauding the tax man because we are not allowed the same deductions as the very wealthy or the big corporations. According to David Sirota's research, most big corporations pay 5% income tax because they are given so many tax incentives, tax-free subsidies, protectionistic import-export subsidies, and deductions we cannot access. For instance, even though our real estate transactions are a major plank of our retirement and investment strategies--and despite the fact that our mortgage agreements require us to maintain, repair and improve the property--we cannot deduct the cost of repairs, maintenance or improvement except in terms of the interest we pay on any loans we take out. But a corporation can deduct ALL of its costs for maintenance, repairs, upkeep and improvement... in its entirety, amortized over several years. If a corporation decides to lease a vehicle, a property, or equipment, the deduction is not amortized, but taken at full value as it is incurred.
Not only do the wealthy have more access, more influence, and more control over our government, but they do not have to pay for it like the rest of us. We get screwed over by them and our political leaders on a daily basis... and they take a bite out of our salaries as well through usury and unprincipled business practices, including outright consumer fraud that our governments (state and federal) allow to occur freely (i.e. bank fees, late charges on credit cards, over-the-limit fees on credit cards, and gas prices).
Senator Charles Schumer got partway off the fence this week on the issue of whether the most highly paid Americans — mainly partners at hedge funds and private equity firms — should continue to enjoy a super-low tax rate. Currently, at a typical hedge fund or private equity firm, partners pay a flat tax of 15 percent on most of their mega-earnings. Salaried employees and wage earners — the majority of the work force — face income tax rates as high as 35 percent.
That's right folks, those of us that put the sweat in sweat equity can pay as much as 35% to the tax man, but those of us that do nothing but deposit cash into already fat accounts pay 15%, or less if their funds manager is astute enough to use off-shore accounts, take advantage of tax write-offs, or use tax shelters in an efficient manner.
But you and I cannot take advantage of these very same loopholes, shelters and methods of defrauding the tax man because we are not allowed the same deductions as the very wealthy or the big corporations. According to David Sirota's research, most big corporations pay 5% income tax because they are given so many tax incentives, tax-free subsidies, protectionistic import-export subsidies, and deductions we cannot access. For instance, even though our real estate transactions are a major plank of our retirement and investment strategies--and despite the fact that our mortgage agreements require us to maintain, repair and improve the property--we cannot deduct the cost of repairs, maintenance or improvement except in terms of the interest we pay on any loans we take out. But a corporation can deduct ALL of its costs for maintenance, repairs, upkeep and improvement... in its entirety, amortized over several years. If a corporation decides to lease a vehicle, a property, or equipment, the deduction is not amortized, but taken at full value as it is incurred.
Not only do the wealthy have more access, more influence, and more control over our government, but they do not have to pay for it like the rest of us. We get screwed over by them and our political leaders on a daily basis... and they take a bite out of our salaries as well through usury and unprincipled business practices, including outright consumer fraud that our governments (state and federal) allow to occur freely (i.e. bank fees, late charges on credit cards, over-the-limit fees on credit cards, and gas prices).
posted by Jim Downey at 12:46 AM
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