Viewing a single comment thread. View all comments

685327592 t1_iv1pu4x wrote

IMO there's definitely different tiers of philanthropy. Anything political shouldn't be praised, it should be condemned. Even donating to your own foundation is pretty questionable since it's a huge tax dodge and often directed towards pet projects.

70

40for60 t1_iv1qznl wrote

Aren't all charitable donations by everyone a "tax dodge and directed towards pet projects"? The tax code has been created to encourage donations this isn't a "dodge".

19

685327592 t1_iv1rthh wrote

No. If you donate to a charity like the Red Cross then they now control that money. However if you donate to your own "charity" then you still control all that money and can now spend it tax free.

13

40for60 t1_iv1sbht wrote

So you can buy a house and a boat for yourself with the money "tax free"?

6

685327592 t1_iv1t4lw wrote

That certainly has happened before, but most people are a little more subtle.

8

40for60 t1_iv1tk1g wrote

explain, I'm really curious how in-tune you really are with this, are you a CPA or an Attorney who sets up and manages charitable trusts and foundations? You seem to be very smart. What % of dollars going into foundations are being used for self dealing?

https://www.irs.gov/charities-non-profits/private-foundations/acts-of-self-dealing-by-private-foundation

1

_BreakingGood_ t1_iv3z185 wrote

Much of it isn't necessarily to buy themselves a yacht or something. It's setting up a foundation, putting your family members in extremely high paying executive positions, then donating to it. Your family members get paid their huge salary to do nothing, and it is beneficial from a tax perspective compared to a gift.

12

40for60 t1_iv5tcax wrote

The family members still need to pay income tax on that so all that is happening is avoiding the estate taxes which you can easily do without setting up a foundation, you don't understand tax codes. In your child like thirst for finding fault you dismiss the good that is done because you need to find villains around every corner. I'm curious what do you do to help the world? Can you list your accomplishments? Or are you just a whiner and complainer? A loser critic?

1

_BreakingGood_ t1_iv61i3p wrote

Yes I said "beneficial from a tax situation" not "tax free"

Learn English mate

1

40for60 t1_iv61sla wrote

But it isn't and would be a big expensive hassle that could put the family members in legal jeopardy for no good reason if the only goal was to funnel money to heirs. Also I'm not your mate, I want nothing to do with you.

1

_BreakingGood_ t1_iv6k1zv wrote

Nope it's pretty well practiced as an approach, nothing illegal about it. Your child or friend just happens to be an executive at the nonprofit you founded. How is that illegal?

Tax benefits come from being able to donate to the non-profit to pay their salary, rather than giving them a flat gift, which has huge taxes after around 11 million.

1

40for60 t1_iv6lu0f wrote

Nothing illegal about doing legal things but there are rules and self dealing is a issue.

If the goal is to get your kids money without the expectation of them doing anything for it there are better ways. Why go through the hassle of setting up a fraudulent foundation? What kind of attorney's and accountants will participate in an obvious illegal venture? All you are doing is generalizing so we might as well say all poor people are criminals too because some poor people steal things. If a person intends to create a foundation and donate money to it with a stipulation that the children are on the board or payroll and they do nothing for it at some point it will be a issue if its abused. My guess is that this problem is much smaller then what you want to believe and most foundations act in good faith. I personal have been involved in many and have yet to witness this kind of bullshit. Do foundations sometimes get top heavy, yes, do they make mistakes, yes, but self dealing as a practice, I doubt its that big of a issue.

1

FlurpZurp t1_iv2mkys wrote

An institutionalized dodge is still a dodge. Just because you bought the politicians/process to enshrine it in law doesn’t make it less immoral.

3

40for60 t1_iv2rx77 wrote

Giving to charity is "immoral". Based on what dogma?

3

Dave_A480 t1_iv3dlw5 wrote

Given the government's record in terms of use-of-funds...

A 'dodge' that goes to private charity is actually more likely to help those in need, then letting .gov have it.

1

[deleted] t1_iv1s8vt wrote

[deleted]

6

685327592 t1_iv1sw2d wrote

It shouldn't be up to Billionaires to decide what is or isn't a worthy cause. They should pay their taxes either way. Bringing up Malaria is a strawman because there's far more questionable things some of these foundations are funding than that.

0

40for60 t1_iv1up8w wrote

If we raised taxes on the rich would things like this happen? Right now the bottom 50% earners in the US only contribute 3% of the Federal income tax, the US doesn't have a VAT and our energy taxes are low. The bottom 50% earners in the US have a comparatively low tax burden versus Europeans and really everyone else.

8

[deleted] t1_iv1uy0p wrote

[deleted]

2

40for60 t1_iv1vfx6 wrote

The charitable giving deductions are not "loopholes" its designed this way on purpose while a loophole is something that was overlooked.

6

685327592 t1_iv1ve68 wrote

Half the people you see on this list are in the bottom 50%. That's because people pay taxes on income, not wealth. So, if you don't sell any stocks you don't pay any taxes even if you're worth 12 figures.

−4

40for60 t1_iv1vpni wrote

No one on this list reports less then 70k per year in income.

People like you are easy to discredit because you don't have your facts or terminology right.

7

685327592 t1_iv1w3rz wrote

That's just false. They routinely report no income. Even when they do report income it's peanuts compared to their actual wealth.

https://www.propublica.org/article/the-secret-irs-files-trove-of-never-before-seen-records-reveal-how-the-wealthiest-avoid-income-tax

In some cases these Billionaires have even received credits meant for the poor:

https://www.businessinsider.com/jeff-bezos-claimed-tax-credit-for-children-propublica-2021-6

3

40for60 t1_iv1wuiw wrote

It certainly can be the case were they will have years of no income after they retire from their jobs like Bezo's has but they eventually cash out some and pay a bunch then. You can make the argument that they can borrow against their wealth but so can any home owner or person who has a 401k, lots of people do this. Anyone can do this, its not illegal. Self dealing on a foundation is illegal and 99.9% of the people who set up foundations don't, this is why Trump is such a scum bag.

4

685327592 t1_iv1x6o2 wrote

Most people are not able to avoid taxes that way. We have W2 income that is taxed far more aggressively.

2

40for60 t1_iv1yvqi wrote

Most people don't actually pay shit for Federal Income taxes, the top 25% earners carry the US paying nearly 90% of the Federal Income tax and last year 57% of the earners paid zero taxes. So your statement is false because MOST people are not paying shit. And most people are not taxed "aggressively". See chart 6 below. Again you don't know what you are talking about.

So MOST people are not taxed on their income, the US doesn't have a regressive consumption VAT tax and our energy is taxxed at a very low rate.

https://taxfoundation.org/publications/latest-federal-income-tax-data/

1

685327592 t1_iv206tu wrote

Most people don't pay much because they don't make much. Your numbers include people in school and retired. Working class people are paying taxes.

PS you still don't seem to understand that top earners and top taxpayers are totally different. The people paying high taxes are W2 earners like athletes and movie stars. People whose money is coming from stocks pay far less or even zero.

1

40for60 t1_iv21vq3 wrote

It includes people who have filed a tax return and also this number is skewed against the top earners because "Readers should note the IRS dataset excludes the refundable portion of tax credits such as the earned income tax credit, which means the IRS data overstates the tax rate paid by taxpayers at the bottom.".

I do understand it, better then you do.

The US tax polices are some of the most progressive in the world and although we don't have some of the same exact social programs some of the Europeans have we also don't have the regressive consumption taxes they have to fund them. The income taxes and corporate taxes are mostly in line with Europe.

3

SB_Raider t1_iv36pmp wrote

I agree with everything you're saying, but the wealthiest 1000 people don't pay nearly the same % of wealth as the rest of the top 5% of earners.

1

40for60 t1_iv37ukp wrote

this is true and it certainly is a problem and why I think the bigger issue is the unearned income tax rate which has made it much easier to accumulate wealth and has allowed Private Equity to become such a big player.

1

_Bellegend_ t1_iv3fxv9 wrote

That’s a damn good reason to tax them appropriately. Some of the best uses of surplus wealth aren’t the ones that get taken up by the rich as pet causes. I agree

−1