I want to make one more comment on Wall Street fraud before moving on. The ten trillion of dollars in Wall Street fraud does not include the ten trillion of dollars in corporate frauds across all industries. So, there is no revenue shortfall====our elected officials are simply aiding and abetting these fraud but blocking any justice.
ALL OF MARYLAND'S POLS ARE GLOBAL CORPORATE POLS.
The first thing we have to know about corporate tax law is that our politicians write these laws that are written with loopholes and have as a goal to allow corporations to get out of paying taxes. So, while Democrats in Congress cry foul at how US global corporations are avoiding paying taxes----they are writing the laws to allow this. IT IS A SCAM. Since Clinton neo-liberals have taken hold of the Democratic Party teamed with Republicans----corporations not only do not pay taxes----taxes are on the profit side of the accounting ledger! Maryland is one of the worst states for pols conspiring with corporations at the expense of its citizens AND YET THEY ARE RE-ELECTED EVERY TIME!
Today I want to show why the American people who think they are participating in the stock market never were----all that money tied to pensions and 401Ks were simply used as fodder to boost gains of the rich while any gains made by the average shareholder were lost over and over usually by deliberate Wall Street frauds. National union leaders have tied US unions to this stock market and are part of killing people's savings and retirements as they know these investments are fodder and the investments promote growing corporations globally.
Let's look at the coming shareholder scam Wall Street has planned.....and how government coffers will again be fleeced by bond market fraud.
Shareholders, public deserve tax transparency
(Peter Macdiarmid/Getty Images) By Catherine Rampell
Opinion writer August 21 Tax inversions. Double Irish with a Dutch sandwich. Spinning off tangible assets into real estate investment trusts. Son-of-BOSS shelters.
These are among the array of eye-glazingly complicated tax avoidance strategies adopted by America’s biggest companies. Each gets a moment in the sun when some enterprising journalist stumbles upon a particularly egregious example of its use; the public expresses outrage; policymakers denounce the behavior, which they themselves have incentivized; and then maybe Congress plays whack-a-mole trying to close the loophole. Then the public forgets, firms come up with inventively aggressive new strategies, and the pattern repeats.
Here’s a proposal to try to curb this cycle: Require all publicly traded companies to make their tax returns public. Period.
This is not a new idea. In fact, when the modern federal corporate income tax was introduced in 1909, it came with a requirement to disclose the returns. Such transparency mandates were fought over bitterly for the next couple of decades, and U.S. returns have been confidential since 1935.
The basic rationale behind tax transparency is that shareholders (and creditors and the general public) deserve to know what publicly traded companies are doing, particularly if complicated tax acrobatics are distorting their operational and investment decisions. Today, publicly traded corporations must disclose some information about their accrued tax liabilities in Securities and Exchange Commission filings, but even tax experts find it nearly impossible to reconstruct what they actually pay from year to year, and to whom — let alone what kinds of intricate shelters they’ve crafted to be able to tell one audience (the public) that they’re hugely profitable and another (the Internal Revenue Service) that they’re barely scraping by.
The objections, on the other hand, tend to fall into three categories.
One is that disclosure will lead to a rash of misinformed analysis as the public tries to conduct amateur audits of firms’ tax returns, which can run many thousands of impenetrable pages. I am unsympathetic to this argument; the counter to bad information is more and better information. And given the massive defunding of the IRS in recent years, maybe it’s not so crazy to want more eyeballs — including those of outside tax experts — on companies’ tax filings.
The second objection relates to giving away trade secrets. But the strategies that companies employ to comply with the law should not be proprietary. If companies fear that disclosing tax returns would reveal non-tax-related competitive information, perhaps there is a way to allow for redactions. But I’m not convinced this is actually a risk.
The final objection is that disclosure could lead to more aggressive tax avoidance, not less. After all, firms might learn from one another about snazzy new ways to shelter income and feel pressure to be more aggressive tax-dodgers than they already are.
“All of a sudden you can easily check your competitors’ tax rates, and if yours is higher than theirs, that’s going to be a problem,” said Alex Raskolnikov, a tax law professor at Columbia Law School. “You could end up in a race to the bottom.”
Perhaps, but another possible result is that, over the long run, companies invest fewer resources in tax avoidance, since they would be forced to share the fruits of their tax departments’ labors with free-riding competitors. And from a social welfare perspective, we want companies to focus their R&D on creating the next iPad, not on finding ways to make their iPad-generated profits magically disappear.
Under the current system, you really can’t blame companies for maintaining massive tax departments, which wade through our convoluted tax code in search of savings.
“Our U.S. code imposes on CEOs a fiduciary obligation to do the best by their shareholders, which very much includes minimizing taxes,” Ivo Welch, an economics and finance professor at UCLA’s Anderson Graduate School of Management, wrote me in an e-mail. “Arguably, a CEO who does not take advantage of a Double-Dutch when (s)he can and instead pays taxes can in principle be taken to court for neglect.”
And then we consumers — and our public officials — have the gall to accuse these firms of being unpatriotic.
Right now there is so little public understanding of how widespread tax avoidance is that individual companies with the misfortune of ending up in a reporter’s cross hairs are vilified, even when their actions are legal and quite commonplace. With more transparency, public discourse could shift away from shaming individual companies and toward shaming Congress for creating, and perpetuating, our terrible, convoluted, loophole-riddled tax system in the first place.
The S Corporation status was the earliest attempt to left corporations from tax responsibility and it affects both shareholders and the American people. Above we read that shareholders should be able to see whether the corporation it is invested is meeting its tax responsibilities because if not---the IRS can come after shareholder wealth for money a corporation cannot pay. The conflict of interest we have today is shareholder wealth increases as corporate profits gain from not paying taxes. Remember, Clinton neo-liberals and Republicans are committed to shareholder wealth so there is no incentive to audit corporations for payment. Today, Obama has allowed hundreds of billions of dollars in corporate taxes go uncollected. Shrinking our government coffers but boosting shareholder wealth. If you are an ordinary investor with a pension fund----you may get some stock gain from corporate tax evasion but that lost revenue comes back to you in the form of higher taxes on the working and middle-class. The only shareholders that gain from corporate tax evasion are those rich that do not pay taxes either.
The second aspect about S Corporations and why they are bad is that transferring corporate tax responsibility to shareholders made the process of auditing for compliance by shareholders harder and more costly and quite frankly I do not believe these shareholder taxes are paid by many shareholders. Again, it is probably only the working and middle-class that claim their shareholder gains.
IF THE IRS DID ITS JOB AND AUDITED FOR SHAREHOLDER COMPLIANCE THERE WOULD BE NO PROBLEM WITH THIS ARRANGEMENT. DID YOU KNOW THAT THE STATES CAN AUDIT AND REPORT THIS TO THE IRS BECAUSE STATES LOSE FUNDING WHEN THIS TAX EVASION HAPPENS.
If you are a shareholder and think this is OK---think who will be stockholders soon as US corporations become global and multinational----they will not want the public attached to these stocks----it will be only fellow corporate boards and CEOs owning each other's stock.
S corporations are corporations that elect to pass corporate income, losses, deductions, and credits through to their shareholders for federal tax purposes. Shareholders of S corporations report the flow-through of income and losses on their personal tax returns and are assessed tax at their individual income tax rates. This allows S corporations to avoid double taxation on the corporate income. S corporations are responsible for tax on certain built-in gains and passive income at the entity level.
To qualify for S corporation status, the corporation must meet the following requirements:
- Be a domestic corporation
- Have only allowable shareholders
- including individuals, certain trusts, and estates and
- may not include partnerships, corporations or non-resident alien shareholders
- Have no more than 100 shareholders
- Have only one class of stock
- Not be an ineligible corporation (i.e. certain financial institutions, insurance companies, and domestic international sales corporations).
Can IRS Go After Shareholders If a Corporation Owes Tax?
by Kevin Johnston, Demand Media
Corporations that cannot pay back taxes still owe the Internal Revenue Service. In the event the corporation cannot meet its tax obligations, the IRS may look at assets belonging to shareholders rather than the company itself. Though one purpose of forming a corporation is to shield owners from personal liability, in practice the IRS has the right to pursue tax payments from anyone that has ownership in the company.
This is an example of ending the practice of Americans as stockholders. Unions acting like Wall Street banks are heavily invested in the market and profiting off global corporations that are killing them. So, a union worker making some money from stock investments while global corporations push them into poverty with wage and benefit cuts.
IF A NATIONAL UNION LEADER ALLOWS WORKERS TO ATTACH TO A WALL STREET MARKET THAT IS KILLING THEM----THEY ARE WORKING FOR GLOBAL CORPORATIONS.
Inversion policy is more about Trans Pacific Trade Pact and how a global corporation will be allowed to operate in the US as it does overseas. Most inversions are happening in developing nations. Notice USA Today doesn't mention this because it is a Wall Street media outlet. Inversion will allow what were US corporations----now multinational----to avoid paying taxes that are not collected in the nation they are registered.
DO YOU HEAR YOUR POLS SHOUTING THIS FOR SEVERAL YEARS? IF NOT-----THEY ARE CLINTON WALL STREET GLOBAL CORPORATE NEO-LIBERALS WORKING TO END CORPORATE TAXATION AT GREAT LOSS OF REVENUE TO THE US. IT WILL MAKE THE US THIRD WORLD.
Getting a tax break for simply building a facility in the US eliminates taxes collected for property. Obama and neo-liberals eliminated the tax on depreciation when Congress was controlled by a super-majority of 'Democrats'.....so, it a time when recovering massive corporate fraud of tens of trillions of dollars through taxation as was done by FDR after the Great Depression-----Clinton neo-liberals are joining Republicans in dismantling all corporate tax base.
CITIZEN SHAREHOLDERS ARE ALLOWED TO SEE ALL THEIR GAINS AS SHAREHOLDERS DISAPPEAR EACH ECONOMIC CRASH SO THERE IS NO REASON FOR THE 99% TO WANT TO PROTECT SHAREHOLDER WEALTH.
As you see, another pathway to retirement for working and middle-class is taken just as the subprime mortgage fraud caused lost homes and home value that many people considered their retirement. It is good to see that Clinton neo-liberals are not being made to do this----they are pushing these policies.
Corporate inversions mean tax hit for shareholders
Kevin McCoy, USA TODAY 3:57 p.m. EDT September 23, 2014(Photo: Medtronic)
Corrections & clarifications: An earlier version of this story misidentified Medtronic's proposed merger partner as Shire instead of Covidien in one reference to that deal.
For an investor who says he just dabbles in stocks, Minnesota doctor James Allen has succeeded far better than most.
By his estimate, Allen has accumulated a more than $1 million stake in Medtronic (MDT), the world's largest medical technology firm, headquartered not far from his home in the Twin Cities area.
He intended to continue holding the stock long-term, for retirement or other special needs. But his plan was unexpectedly upended in June. Medtronic announced it would undergo a corporate inversion by reincorporating its headquarters in Ireland after buying Dublin-based rival Covidien (COV) in a $42.9 billion cash and stock transaction.
The pending deal is expected to help Medtronic avoid billions of dollars of U.S. taxes on future foreign profits if the company opts to invest them in the U.S., such as by building new plants, funding research or buying back stock. The transaction could be complicated by new restrictions on inversions announced Monday night by the Obama administration.
Hmmmmmm.....I wonder if Gross is deliberately allowing his global corporation PIMCO fall into bankruptcy because having been a heavy player in using pensions as fodder he led the final attack on pensions with this coming bond market crash with many pensions tied to this collapsing bond market. Oh look----he is taking out the shareholders too! You can bet the investment firms and Wall Street exited PIMCO as they will not be tied to it in this coming bond market crash.
Now, all Congressional pols know their policies were meant to implode the bond market and they also know this man is bailing to leave the 99% holding the costs that this corporation will incur as this coming bond market crash sends it into bankruptcy just as the AIG insurance corporation was targeted with the subprime mortgage loan fraud and sent into bankruptcy. Both of these were huge global corporations so this bankruptcy will take the world's wealth just as AIG's bankruptcy did and it was all planned.
Bill Gross' Parting Gift to Fund Shareholders: Higher Taxes?
By Dan Caplinger
November 3, 2014
Bill Gross. Source: PIMCO
The high-profile departure of Bill Gross from PIMCO to Janus Capital (NYSE: JNS ) got plenty of headlines. Internal political upheaval at the bond-focused money-management firm finally led the billionaire fund manager to jump ship. Gross leaves behind a legacy of strong returns for longtime shareholders in funds like his flagship PIMCO Total Return Fund (NASDAQMUTFUND: PTTRX ) . But as the end of the year approaches, shareholders could see most unwelcome news from the fund in the form of a substantial distribution of taxable capital gains.
The workings of mutual fund taxation can be outright confusing. But many experts are primarily concerned that a huge exodus of PIMCO Total Return shareholders in the wake of Gross' departure could have forced the fund to make massive sales of its assets -- and managing shareholders' redemption requests in such a way that would minimize the tax impact would have been challenging at best.
Below you see how Obama and Congressional neo-liberals have moved as much wealth to the top as Bush using tax code and Federal 'stimulus' and bailout schemes. This article comes from the idea of a tax reform that lowers taxes on the working and middle-class as tax fairness where I come from the idea that 35% is not too much and the reform such be solely on corporate taxation that reaches 70%. This is of course what was done in FDR's time -----today we have Clinton neo-liberals and Republicans moving all the costs of government onto the middle and working class. Federal and state taxation is on the rise. In Maryland we had a Bush neo-con run on lowering taxes but watch----he'll take away one tax----say the 'rain tax' and then all of his tax policy will be about lowering corporate tax rate to make Maryland 'business-friendly'.
Obama and neo-liberals raised the capital gains tax a few years ago as they knew the stock market was being restructured to a global market. As I show above---the American shareholder will be kicked aside and left with the costs of doing business.....taking most of the gains they thought they had built as a corporate shareholder. Then, there will be no public stock options. This was discussed in 2009 so all Congressional pols know this and have worked towards this----
BYE BYE ALL AVENUES OF SAVING AND RETIREMENT SAY CLINTON NEO-LIBERALS AND BUSH NEO-CONS!
'The reason: The federal code provides that there is no tax on capital gains or qualifying dividends for people in the 15% income tax bracket. That means that a Los Angeles married couple filing jointly for 2014 with $94,100 of adjusted gross income, all from long-term capital gains and qualifying dividends, would pay nothing — zero! — in federal income tax. But their California tax bill would be north of $3,000'
'In 1924 — a different era to be sure— industrialist-robber baron-Treasury Secretary Andrew Mellon wrote in support of treating wages more favorably than investments. “The fairness of taxing more lightly income from wages, salaries or from investments is beyond question,” he wrote. “In the first case, the income is uncertain and limited in duration; sickness or death destroys it and old age diminishes it; in the other, the source of income continues; the income may be disposed of during a man's life and it descends to his heirs. Surely we can afford to make a distinction between the people whose only capital is their mental and physical energy and the people whose income is derived from investments.”'
A tax system tilted toward the rich The tax code started to tilt in the direction of favoring income from investments -- or favoring the 1%, if you will -- more than 20 years ago.
(Daniel Acker / Bloomberg) By Joseph Anthony
A couple living off investments has tax load just a little more than a third of what wage earners pay Congress managed to pass a tax bill in December — a great relief to tax professionals like myself. But what our legislators didn't do was address the fundamentally unfair way the United States taxes people who work for a living compared with people who live off of the earnings of their investments.
Our current system hits working Americans with punishing rates compared with what the investing classes are charged. A generation's worth of legislative twists have left our tax code so warped that during the coming filing season, one married couple bringing in $150,000 in total income from two jobs could find itself paying almost three times as much in federal income taxes as another couple that is alike in every way — except for the source of its income.
Leveling out the tax treatment of wages and investment incomes would increase the perceived and actual fairness of the tax code. - The tax code started to tilt in the direction of favoring income from investments — or favoring the 1%, if you will — more than 20 years ago. In 1993, the year Bill Clinton took office, a married couple claiming the standard deduction — with no children, tax credits or other adjustments to income — and earning $75,000 apiece in wages, would have paid $35,650 in federal income taxes.
A similar couple, whose income came solely from long-term capital gains, would have gotten a small break thanks to what was then the 28% top rate on those gains. Their total tax bill, $34,158, would have been about $1,500 lower than that of the wage earners.
By 2000 — the year George W. Bush was first elected — the tax gap between wage earners and investors had already opened up. In that year, our two-wages couple would have paid $33,607 in taxes. They also would have paid that amount if all of their income had been from stock dividends; there was no preferential treatment for dividends at that point.
But the couple whose income came from long-term capital gains would have paid $23,025 in taxes — almost a third less.
Fast-forward to the 2014 tax season. Our two-income couple are still working full time to make the same $150,000 (not a farfetched scenario in our new-normal era of stagnant wages). After a decade's worth of inflation adjustments to their tax bracket, their tax bill is now $24,138.
And the couple living off of their investments? Their tax bill — whether their money came from long-term capital gains or qualifying dividends — has been slashed to $8,385, or a little more than one-third of the tax load on wage earners.
Don't Republicans have the stomach for tax reform? Some of my clients who get their money from unearned income find this discrepancy unbelievable when they compare their federal taxes to their state bills. During this tax season, I know I will have clients — in California and Oregon, where I live — who will pay more in state income taxes than they do in federal taxes. I may even have some clients who will be stunned to learn that they face a four-figure state tax bill while paying exactly zero in federal income taxes for the year.
The reason: The federal code provides that there is no tax on capital gains or qualifying dividends for people in the 15% income tax bracket. That means that a Los Angeles married couple filing jointly for 2014 with $94,100 of adjusted gross income, all from long-term capital gains and qualifying dividends, would pay nothing — zero! — in federal income tax. But their California tax bill would be north of $3,000.
How did we get to this point? No legislator ever campaigned saying, “Tax laborers more than investors!” But several changes in the code since the early 1990s, including lowered tax rates on capital gains and lowered rates on qualified dividends, have conspired to produce that result. My high-income clients were dismayed last year by the new 3.8% net investment income tax, which applies to joint filers with modified adjusted gross incomes of more than $250,000 ($200,000 for singles), but that affects relatively few filers and, perversely enough, applies to non-tax-advantaged income such as rentals, as well as to dividends and long-term gains.
Can Democrats support a simpler tax code with lower rates? Neither political party gets sole credit or blame. President George W. Bush was most aggressive about pushing such tax changes, but breaks for unearned income were also passed and extended under both the Clinton and Obama administrations. Supporters argued that lower rates would benefit retirees living on fixed incomes and also spur investments. But the Center on Budget and Policy Priorities says that almost half of all long-term capital gains in 2012 went to the top 0.1% of households by income. For the nearly 60% of elderly filers who had incomes of less than $40,000 in 2011, the lower rates were worth less than $6 per household.
In 1924 — a different era to be sure— industrialist-robber baron-Treasury Secretary Andrew Mellon wrote in support of treating wages more favorably than investments. “The fairness of taxing more lightly income from wages, salaries or from investments is beyond question,” he wrote. “In the first case, the income is uncertain and limited in duration; sickness or death destroys it and old age diminishes it; in the other, the source of income continues; the income may be disposed of during a man's life and it descends to his heirs. Surely we can afford to make a distinction between the people whose only capital is their mental and physical energy and the people whose income is derived from investments.”
Well, that's certainly not going to happen any time soon. But leveling out the tax treatment of wages and investment incomes would increase both the perceived and actual fairness of the tax code. It would eliminate preferences that distort investment and financial planning decisions. A fairer code might also increase respect for the system and improve tax collection rates overall.
Joseph Anthony is an enrolled agent and tax pro in Portland, Ore. He can be reached at firstname.lastname@example.org.
For those that did not notice this tax law on capital gains passed under the hoopla of Obama supposedly raising capital gains taxes on the rich......this new law seeks to eliminate capital gains taxation on sale of assets. Notice it is directed at working middle class stock holders. Since the goal of Clinton neo-liberals and Bush neo-cons with global corporations and market is to end the entire policy of public listing and options for stocks-----this is the segue way out of the business of stock market for you and me. With the bond market crashing all stocks will take the usual plunge so if I were you----I'd take this sellout because you will be taken soon anyway. Market value is best when you hold stocks long term----but global corporate pols are telling you ------citizens need not apply to the stock market----it will be privately held by the richest.
No capital gains due for some investors
By Kay Bell • Bankrate.com
You heard right. There's no -- nada, nothing, zilch, zero -- capital gains tax on the sale of assets held for more than a year.
But you might not have heard the full story.
Bob D. Scharin, senior tax analyst from the tax and accounting business of Thomson Reuters, calls the law that was made a permanent part of the tax code Jan. 2, 2013, "the ultimate tax rate reduction." But as is often the case with tax provisions, this modification comes loaded with restrictions.
First, the elimination of capital gains tax applies only to assets owned for more than a year. Short-term sales remain taxed at your ordinary tax rate.
Then there is a monetary cap.
And it's not for every investor. Some young investors have been expressly excluded from the zero percent option. Others, such as Social Security recipients, could find that untaxed capital gains might mean new or additional taxes on their retirement benefits.
So before you rush to your broker to sell all your stocks and mutual funds, check out the law's finer points and how they might or might not apply to you.
Cashing in on lower capital gains taxes
Long-term capital gains taxes were first eliminated for some low- and moderate-income individuals in 2008. This zero-tax break was made a permanent part of the tax code Jan. 2, 2013, when the American Taxpayer Relief Act was signed into law.
Ordinary income tax bracket
Long-term capital gains rate by tax year20072008 - 20122013 and beyond10 percent5 percent0 percent0 percent15 percent5 percent0 percent0 percent Income $400,000 or less for single taxpayers; $450,000 or less for married filing jointly taxpayers15 percent15 percent15 percent Income more than $400,000 for single taxpayers; more than $450,000 for married filing jointly taxpayers15 percent15 percent20 percent Limited to lower incomes The first, and for most the biggest, hurdle to overcome is the earnings limit. Individuals in the two lowest tax brackets -- 10 percent and 15 percent -- can sell long-term assets and escape any capital gains taxes.
While the percentages are low, when you consider dollar terms, the amounts look a bit more feasible. The 15 percent bracket for tax year 2013 goes up to $36,250 for a single filer; $48,600 for a head of household; and $72,500 for a married couple filing a joint return.
Even if you make more than the maximum for your filing status, you still might be able to take advantage of the zero percent rate. The reason: The cutoff amounts are taxable income, not the larger adjusted gross income amount.
"People are used to having deduction phaseouts tied to adjusted gross income," says Scharin. "This one is geared to taxable income."