This post is in response to this post on a trust described here.
First, thanks for being civil. That helps me understand how others see things, even if we don’t ultimately agree. That said...
Of course paying less taxes is the goal, but that doesn’t reveal what the person intends to do with the savings or their justifications. Also, choosing one particular exemption as bad while ignoring the rest strikes me as cherry picking.
For example, my taxes this year on TSLA investments will be mostly ordinary income, because I’ve traded short term options. Being in California means I’ll also pay nearly 10% more in taxes than you.
Why is it fair for me to pay 50% and for others to pay 23% on investment gains? As far as I can tell, it’s our government that says it’s fair. These are their rules that everyone agrees on.
If a 2x+ tax difference is fair because the government says so, using deductions offered by the government to reduce the tax burden on profits should be fair too. Same rules.
As for intent, what if someone is just trying to reduce overall taxes to 40%, the same amount you’d pay? Or to 23%, the amount you’d pay with long term capital gains? Or donate more to charities because they feel the government is awful at using capital? Or pay for someone’s medical care?
There are lots of good uses for capital besides paying taxes, that are not completely self serving.
The linked article's advice was to create a charitable trust, offload appreciated shares to it, the self said shares, and hand the money back to yourself in annual distributions.
Seems to me that the motivations of this action and intentions of the originator are to avoid payment of appropriate capital gains tax. Can you tell me another possible motivation or intention?
First, thanks for being civil. That helps me understand how others see things, even if we don’t ultimately agree. That said...
Of course paying less taxes is the goal, but that doesn’t reveal what the person intends to do with the savings or their justifications. Also, choosing one particular exemption as bad while ignoring the rest strikes me as cherry picking.
For example, my taxes this year on TSLA investments will be mostly ordinary income, because I’ve traded short term options. Being in California means I’ll also pay nearly 10% more in taxes than you.
Why is it fair for me to pay 50% and for others to pay 23% on investment gains? As far as I can tell, it’s our government that says it’s fair. These are their rules that everyone agrees on.
If a 2x+ tax difference is fair because the government says so, using deductions offered by the government to reduce the tax burden on profits should be fair too. Same rules.
As for intent, what if someone is just trying to reduce overall taxes to 40%, the same amount you’d pay? Or to 23%, the amount you’d pay with long term capital gains? Or donate more to charities because they feel the government is awful at using capital? Or pay for someone’s medical care?
There are lots of good uses for capital besides paying taxes, that are not completely self serving.
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