Time To Pay the Piper
Andy note: "Blast from the past - Best of Eddie" - This one is originally from April 2010 . If there's an old post from Eddie you'd like to see up again shoot me a message.
I've often wondered why there's no unrestricted free agency for taxpayers. You know, like an athlete fulfills his contract and then becomes an unrestricted free agent and is free to sign with the highest bidder, or the team he feels will be the best fit. Why can't a tax payer, after paying into the system a certain number of years or reaching a certain threshold of taxes paid, sign with a lower-tax jurisdiction or the country he thinks will be a better fit?
Think about it. The only people the notion would appeal to are the top earners, so there would be competition on the part of other countries to attract that kind of "talent" with the promise of lower taxes, better climate, etc... American corporations (since they've all but abandoned manufacturing) enjoy this freedom. Steve Ballmer of Microsoft even went so far as to say that if the IRS messed around with corporate taxation (specifically, an American corporation's ability to book profits in low-tax international jurisdictions but write off losses against highly-taxed American earnings) that the company could close down and re-open the next week in another country.
Doesn't it seem fair that individual tax payers should be afforded the same opportunity? I'm making this point because some truly frightening things have come out on the taxation front this week.
Depending upon whom you believe, the new health care reform bill calls for the addition of somewhere in the neighborhood of 16,000 new IRS agents. These guys will be there primarily to enforce fines and penalties. Whether you are for or against the bill (and I'd rather this not devolve into a healthcare debate), I'm sure we can all agree that more IRS agents - FOR ANY REASON - is a bad thing.
Next, I present you with this chilling video and the accompanying article (it's short; read it):
...continue to use new and enhanced techniques to bring people into the tax system...
If that doesn't make you shiver, I don't know what will. The last time someone in government was extolling the virtues of "new and enhanced techniques", it was that dickbag Cheney telling the world that we were suddenly okay with torture.
The bottom line is, these guys really believe that it's their money, even though you earned it. They're just letting you hold it for a while. But if you try to hide their money, well, they're gonna come down on you like a ton of bricks.
Finally, I wanted to point out something Paul Volcker said the other day. Don't shoot the messenger. Volcker is pretty much a straight shooter and is only saying what everyone knows in the back of their mind already. Taxes are going to be raised. And not just that, we should get ready for a European-style VAT here in the States. Not instead of our current system of taxation, but in addition to our current system of taxation.
The years of deficit spending, dipshit wars, bank bailouts and other corporate welfare, and a bevy of government giveaways have finally caught up with us, and it's time to pay the piper. And for individual tax payers, there will be no escape. The days of true wage slavery are fast approaching.
Somebody get my agent on the phone...
Comments
- There is "free agency";
- There is "free agency"; give up your American citizenship and you can move where ever you want and pay whatever taxes you want. It's probably a little painful and time-consuming but it's definitely an option.
- There are situations where more IRS agents are a good thing - when there aren't enough for whatever reason. Do I know that we need more/less? No idea. But to say out of hand that it's always a bad thing to have more IRS agents is just stupid.
- Taxes are still ridiculously low here, both historically for the US and compared to other developed countries. This is coming from a unmarried, no kids guy living in NYC, paying the highest tax rate. Believe me, every pay check is painful but that's reality.
- Loving the completely unwarranted comparison between new tax collection techniques and government-sanctioned torture. Completely warranted and not exaggerated at all.
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I actually agree with
I actually agree with Edmundo, but the idea of 'free agency' for taxpayers is so idyllic it makes me laugh. That is not how democracy works, Im afraid.
ideating, I always enjoy our
ideating,
I always enjoy our exchanges. Renouncing citizenship has never been a simple matter, but now it is next to impossible. In years gone by, when a U.S. citizen renounced his citizenship, the government reserved the right to determine whether he was doing it strictly for tax purposes, and if so, could tax him a certain percentage for a number of years post-renunciation.
Now when an American citizen renounces, the government demands 35% of that citizen's worldwide assets in cash, immediately. Free country, my ass.
I don't know how "historical" you want to get, but the fact is our country made it 136 years without an IRS, and without personal income taxation. In that time, we became the glowing beacon on the hill, an industrial powerhouse, and a symbol of hope to the world. Now, not so much.
Edmundo, The lunacy goes
Edmundo,
The lunacy goes further.
The US is the only developed country IN THE WORLD to impose tax on FOREIGN-EARNED income.
The American passport becomes a complete liability when it comes to working abroad.
It's absolutely incoherent: people (abroad and locally) deride the dearth of cosmopolitan knowledge and experience amongst Americans, but don't stop to think that Americans have NO incentive to go ply their trade abroad and learn foreign arts: look at that pathetic income tax!
Sadly, between the Republican disdain for the un-American and the Democratic love of taxes, this isn't likely to get any better.
Don't know enough about
Don't know enough about renunciation tax policy to comment unfortunately.
Re: historical tax rates - yes, the IRS didn't exist until 136 years ago but the US government was also puny by modern standards. You can disagree with the government's current spending plans/policies but at the end of the day, we have a huge and mounting deficit that needs to be addressed. A comparable time period for today would be the 50s, with the ridiculous amount of WW2 debt still piled on. The top income tax rate was >90% for the decade before dipping into the 70s for most of the 60s and 70s. A top marginal tax rate of 35% currently is not THAT bad by comparison.
You can also disagree with the politics of an increasingly socialized medical system but the fact is that we are moving to a certain level of government services and we need to pay for it. I would argue that this is a natural evolution in a country's lifecycle, much like moving from an agricultural to an industrial to a service-based economy. You can argue whether it is good or bad, but that is an argument on values that you can't really win - it's the reality no matter what individually we may want or believe.
The days of libertarian politics driven by the fronter mentality and a small government supported solely on tariffs on coffee and sugar are over.
ideating,
I always enjoy our exchanges. Renouncing citizenship has never been a simple matter, but now it is next to impossible. In years gone by, when a U.S. citizen renounced his citizenship, the government reserved the right to determine whether he was doing it strictly for tax purposes, and if so, could tax him a certain percentage for a number of years post-renunciation.
Now when an American citizen renounces, the government demands 35% of that citizen's worldwide assets in cash, immediately. Free country, my ass.
I don't know how "historical" you want to get, but the fact is our country made it 136 years without an IRS, and without personal income taxation. In that time, we became the glowing beacon on the hill, an industrial powerhouse, and a symbol of hope to the world. Now, not so much.
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Edmundo Braverman
ideating,
I always enjoy our exchanges. Renouncing citizenship has never been a simple matter, but now it is next to impossible. In years gone by, when a U.S. citizen renounced his citizenship, the government reserved the right to determine whether he was doing it strictly for tax purposes, and if so, could tax him a certain percentage for a number of years post-renunciation.
Now when an American citizen renounces, the government demands 35% of that citizen's worldwide assets in cash, immediately. Free country, my ass.
I don't know how "historical" you want to get, but the fact is our country made it 136 years without an IRS, and without personal income taxation. In that time, we became the glowing beacon on the hill, an industrial powerhouse, and a symbol of hope to the world. Now, not so much.
just saying theoretically,what if you moved all your assets to bermuda,moved there, showed up at the us consulate and said "peace bitches"? How could the us govt assert their claim?
Say "show me the money"
Say "show me the money" Edmundo, SHOW ME THE MONEY!
fhurricane wrote: just saying
just saying theoretically,what if you moved all your assets to bermuda,moved there, showed up at the us consulate and said "peace bitches"? How could the us govt assert their claim?
LOL.
I'll refer you to UBS customer service for the answer to that one...
Edmundo Braverman
Finally, I wanted to point out something Paul Volcker said the other day. Don't shoot the messenger. Volcker is pretty much a straight shooter and is only saying what everyone knows in the back of their mind already. Taxes are going to be raised. And not just that, we should get ready for a European-style VAT here in the States. Not instead of our current system of taxation, but in addition to our current system of taxation.
The years of deficit spending, dipshit wars, bank bailouts and other corporate welfare, and a bevy of government giveaways have finally caught up with us, and it's time to pay the piper. And for individual tax payers, there will be no escape. The days of true wage slavery are fast approaching.
Do you think they'll be a significant number of people who will move to other countries? I was born and raised in the US (and only speak English), but if taxes got high enough here in the states, I'd definitely be willing to work/live in plenty of other countries. The truth is, I'd be willing to do this now, but it seems like there's not tons of good opportunities (feel free to correct me if I'm wrong). As we keep approaching a Nanny State, I wonder if more individuals and businesses will setup shot elsewhere, leading to more opportunities for people like myself?
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ideating, I actually agree
ideating,
I actually agree with you on every point. (except you misunderstood the inception date of the IRS, which was 1912 - 136 years into our country's history and only 98 years ago). Libertarianism is a lost cause in the U.S. and the vast majority of the population is in favor of the expanded government services that we have today. I also agree that the deficit is a monster, and taxes have to be raised to tame/slay it.
What I can't understand is why we can't let free men and women opt out without extorting 35% of their worldwide assets. If it's such a great country, why do you have to pay to leave??? The government knows the best and brightest would hit the doors the minute they weren't barred by mafia-level extortion.
Renunciations were up 9,000% in the decade leading up to the 35% rule (1998-2008), so plenty of people clearly want to GTFO.
Believe me, dude, these things are hard to come to terms with. My dad and I both fought for the U.S. in the military. I accept that the country has gone in a different direction, and that the things we believed in no longer really matter, but it really chaps my ass that I can't even raise my family somewhere else without paying what amounts to "tribute".
econ wrote: Edmundo
Finally, I wanted to point out something Paul Volcker said the other day. Don't shoot the messenger. Volcker is pretty much a straight shooter and is only saying what everyone knows in the back of their mind already. Taxes are going to be raised. And not just that, we should get ready for a European-style VAT here in the States. Not instead of our current system of taxation, but in addition to our current system of taxation.
The years of deficit spending, dipshit wars, bank bailouts and other corporate welfare, and a bevy of government giveaways have finally caught up with us, and it's time to pay the piper. And for individual tax payers, there will be no escape. The days of true wage slavery are fast approaching.
Do you think they'll be a significant number of people who will move to other countries? I was born and raised in the US (and only speak English), but if taxes got high enough here in the states, I'd definitely be willing to work/live in plenty of other countries. The truth is, I'd be willing to do this now, but it seems like there's not tons of good opportunities (feel free to correct me if I'm wrong). As we keep approaching a Nanny State, I wonder if more individuals and businesses will setup shot elsewhere, leading to more opportunities for people like myself?
Can anyone suggest the best/most attractive country (financially/lifestyle) to relocate at this point in time?
I can't speak for everyone
I can't speak for everyone but the day Uncle Sam let's me become a "free agent", I'm not sending him one red cent.
You are damned if you do and damned if you don't. Pay low american taxes and fork over money for tuition, medical bills, car maintenance bc of potholes, empty out your savings when you loose your job or pay higher taxes, and don't pay for any of that crap.
^^ what is the best country
^^ what is the best country then?
"Now when an American citizen
"Now when an American citizen renounces, the government demands 35% of that citizen's worldwide assets in cash, immediately. Free country, my ass."
I'm not sure this is exactly true. You are immediately marked to market on all your assets, but that might be at the capital gains rate. Given what the market's done, now might not be a bad time.
But the govt catches you in its tax net for the next several years (10?) even after you've given it up.
And I don't really think the US's taxes are that low.
Jimbo, You're actually
Jimbo,
You're actually referring to the old way they did things. If you renounced prior to the 35% rule, they could examine your income for the next 10 years and asses taxes against you if they determined that you renounced in order to avoid taxation.
As of two years ago, they no longer want to be bothered keeping track of someone for 10 years in the off chance they might get some tax money out of them. So now they just demand 35% of global assets regardless of the reason for renunciation. Obviously this change has been kept quiet, but the expat community is intimately aware of it.
@PA. Most *important*
from what i have heard
As U.S. citizens, we all
Whining about taxes, in the
I'd also like to add that I'm
ke18sb wrote: I'd also like
You want tax fraud? How about
All Liberals should read
All self entitled WASPS need
Why are people getting so
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All Liberals should read
Wall Street leaders now understand that they made a mistake, one born of their innocent and trusting nature. They trusted ordinary Americans to behave more responsibly than they themselves ever would, and these ordinary Americans betrayed their trust.
I'm pretty sure your employer
Why would your employer (a
Wall Street leaders now understand that they made a mistake, one born of their innocent and trusting nature. They trusted ordinary Americans to behave more responsibly than they themselves ever would, and these ordinary Americans betrayed their trust.
In order to renounce, you
What struck me about the
Would that he were only a
This is a complete tangent to
Wall Street leaders now understand that they made a mistake, one born of their innocent and trusting nature. They trusted ordinary Americans to behave more responsibly than they themselves ever would, and these ordinary Americans betrayed their trust.
http://www.newyorker.com/onli
So, let me make sure I get
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Once you renounce, I doubt
jtbbdxbnycmad wrote: What
jtbbdxbnycmad wrote: What
fhurricane
Edmundo, You're missing a key
nrc_chicago, While there are
breakinginnew wrote: from
There is no question that our
m.c.trader wrote: All
"Could Bill Gates have
Jimbo wrote: "Could Bill
ke18sb wrote: Whining about
Work hard, play hard.
Tell me how this isn't
Edmundo Braverman wrote: Tell
Work hard, play hard.
IP, I agree with you. I am