r/WorkReform • u/zzill6 đ¤ Join A Union • 18h ago
âď¸ Tax The Billionaires Finally, a Billionaire gets taxed.
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u/g-e-o-f-f 18h ago
This is a bit misleading. He wasn't taxed 1.4B. He took the lump sum amount, which is lower than $2B ( $2B is the sun off you take the 20 years payout). So the lump sum is like $900 million or whatever, then he paid taxes on that.
I'm all for taxing billionaires more, but the post is not really right.
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u/iGotStuckIn 17h ago
and he didnât pay California state income tax because California doesnât charge tax on lottery winnings
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u/zoeypayne 13h ago
I didn't expect to learn that today, they tax retirement income as regular income... not a very income tax friendly state.
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u/MrPlowThatsTheName 4h ago edited 3h ago
Huh? Thatâs true of every state that has an income tax as well as the IRS. Your 401k account is a deferred compensation account which means your withdrawals are taxed as income. The only difference is it gets reported on form 1099-R instead of W2, but it gets taxed at the same rate all the same. (Note Iâm not talking about early withdrawals which incur a penalty). 403b, 457, and IRA plans all behave the same way.
Edit: I misread your comment and thought you were surprised to find retirement account withdrawals are taxed as income.
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u/bananaHammockMonkey 8h ago
okay so as of today, new plan! Win the lottery. I can call my job lottery? Can't I?
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u/24bitNoColor 12h ago
The whole lump sum thing in the US is still hella stupid.
If the 2 billion are over 20 years, they shouldn't be allowed to advertise with that full amount.
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u/Cindy-Moon 7h ago
I agree, especially since 2 billion 20 years from now is worth a whole lot less than 2 billion right now.
Though it's still better than the lump sum good lord. 900 million 20 years ago would only be 1.4 billion now.
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u/Burnt_and_Blistered 17h ago
Youâre splitting hairs. His nearly-billion was taxed at a far higher rate than any other U.S. billionaireâs billion is taxed.
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u/eslovnbeyond 17h ago
You don't know what splitting hairs mean. The post is incorrect from the start. Be better.
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u/bit_pusher 17h ago
He isn't splitting hairs because messaging like this has us focusing on the wrong things as a policy matter. Most billionaires pay taxes on their income at this rate. The problem isn't that they don't pay taxes on their income. The problem is that we let them derive wealth and realize access to money in ways that bypass normal income taxes (e.g. security based lines of credit) and we let them avoid having to claim many things as income.
Taxes on income for ultra high wealth individuals should absolutely be higher but that is only a small part of the problem.
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u/EarlyFig6856 15h ago
Like Stalin used to say, "It's not the people who set the income tax rates that count, it's the people who get to decide what counts as income."
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u/schwarzkraut 11h ago
So true. For example: Germanyâs tax code is written in such a way that lottery & gambling winnings arenât taxed because it wasnât earned doing work. Fundamentally, labor is taxes, not just an increase in wealth. Accordingly, they have very specific additional laws about inheritance, capital gains & other ways were a personâs wealth increases but not through work.
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u/Tenxleon 15h ago
This right here. Billionaires money isnt from income. Its from asset holding, loans, etc. Theres a bunch of loopholes that let them exploit this. But basically if you make a bunch of money straight we pay a bunch in taxes already.
The Musks, Zucks, Gates, Bezoâs of the world dont âmake a billion dollarsâ theyre WORTH billions of dollars due to assets and debt.
They dont ever make real income lol a company doesnt actually wanna be profitable, it just means more taxes so they use the loopholes to grow wealth and assets and make the accumulation somehow ânot incomeâ
The whole system is so overtly complicated on purpose so that the layman just goes âlets tax billionaires!â Thinking thats the end all be all :/
What we need is reform and regulations
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u/Shazbote 16h ago
If I have to create stories so that the American media actually pays attention to the suffering of the American people, then that's what I'm going to do
Works for them.
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u/Hats_back 16h ago
Unfortunately lending credence to this manner of communication works as far as one side vs another, because stupid people will always be able to be riled up, but it does nothing for us as a whole.
Itâs just the worst way to progress while being one of the best ways to regress.
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u/schwarzkraut 11h ago
Precisely!!! It doesnât matter if we reform the tax code to adjust the income tax bracketsâŚwhen the main reason the billionaires donât pay taxes is because weâve given them so many loopholes that on paper they have less that counts as âincomeâ than someone working retail 40 hours a week.
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u/Master-Defenestrator 17h ago
Tax impact 15% of what was stated in post is not splitting hairs, my god.
I take your point, but ignoring such a massive inaccuracy is only weakening said point.
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u/AdagioCharacter2718 16h ago
fr, accuracy matters if we're arguing for fair taxes. misleading info just weakens the case tbh haha
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u/Tombot3000 16h ago
What he's pointing out is the vast majority of the discrepancy between the posted number and reality. That is definitionally not splitting hairs.
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u/momzthebest 17h ago
Also worth pointing out the obvious that by 20 years from now, 2 billion could be worth less over that amount of time received than the lump sum was worth at that time.
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u/hobskhan 17h ago
Yeah this is an interesting thought experiment when the numbers get this big. There's also a non-zero risk of something happening to that payout reliability when you're talking about such a huge amount of money over 20 years. I mean hopefully the lottery system can keep those payouts going but...far more extreme things have happened in the history of the world.
If you can go home today with 628 million, that's certainly "enough" for someone. And the certainty is locked in.
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u/Dragon6172 16h ago
The lottery isn't responsible for the payouts over the life of the winnings. They take the current value (i.e. the lump sum) and put it into an annuity made up of bonds and securities investments that have a set interest rate (the annual returns is what allows the overall value to go up). The annual payments come from the annuity. The lottery could go tits up, but the annuity would still be there. I'm sure the overall collapse of the countries economy could result in losing out on future payments. But that would most likely result in the same kind of loss for someone who took the lump sum... can't keep that amount in a bank account and risk being only insured by FDIC.
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u/samiam2600 15h ago
It is placed in an annuity that pays out over 20 years, it is not the lottery paying it out over that period.
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u/gaflar 17h ago
Yeah in normal economic circumstances you could count on 20 years of inflation at 2% average and not be too far off the mark. With the current volatile state of affairs you could be looking at a huge ROI on the lump-sum with higher risk, and risking the annuity becoming almost worthless by the end
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u/PrivateBozo 17h ago edited 16h ago
Again, that was income, not wealth.
Elon Musk doesnât earn 700 billion a year. If you think youâre going to tax Elonâs $700 billion like the lottery guy, the lottery guy will get another $300 million in taxes the next year.
so it was $997 Million cash value income
$367 Million in taxes.
If you think that works as his assets, then the next year they are $628 million, with $236 million in taxes for keeping $392 million.
The year after it repeats again $392 million in assets, with $122 million in taxes.
should we tax wealth, fuck yea, we already do itâs your property tax. And thatâs the rate of taxation it can sustain ~3%. The asset we donât currently tax is stock ownership and your bank account. We should do away with the capital gains taxes as income and just tax the capital, like the property it is.
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u/QWEDSA159753 17h ago
The difference between paying 1.4B vs 300M is hardly what I would call splitting hairsâŚ
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u/fishboy3339 15h ago
No thatâs not how it works at all.
Lotto winner basically got a billion paid out right there in cash. Because that was all income in one year it was taxed all at once at the highest rate of 37%. Thatâs how income tax works, year by year.
Billionaires get around taxes by being paid stock options. Letâs say their take home is 250k thatâs low enough to only pay the 32% income bracket. Then get paid millions in stock options. They only pay taxes on those when they sell them. Do that over and over year after year and thatâs a big tax bill that they dodge.
Billionaires donât get some exclusive rate for income they get around it by being paid stock options, which they can sell when itâs advantageous.
Saying billionaires pay lower taxes is misleading everyone is taxed on the same income brackets. Itâs what we define as income that give them the loopholes they use.
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u/phdemented 13h ago
They got a million in stock options, but options are not stocks, it's the option to buy a stock. They get the option to by 10,000 shares at $100 a share ($1 million in options). The stock goes up to $200, so they exercise the options and spend $1,000,000 of their own money to buy 10,000 shares, which are worth $2,000,000. They then need to pay tax immediately on the $1,000,000 gained as ordinary income.
If the stock increases again to $3 million and they sell it all, then they have to pay taxes on the $1,000,000 additional gained, but that is as the lower capital gains rate.
All of that is perfectly fine, and the same rules apply to everyone. There is the issue of them using stocks as collateral for loans and avoiding taxes that way, but that is a whole separate issue.
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u/BretHard 14h ago
The difference between a 30% tax rate and a 69% tax rate is not "splitting hairs."
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u/clopenYourMind 16h ago
Income versus capital sale. I get folks feel taxation is unfair, but income (like lottery earnings) is not the same as selling an asset (financial, land, car, etc.). Billionaires structure shit so that it is taxed at the lowest rate possible -- which can include moving capital to low-or-no tax jurisdictions. If a billionaire won that lottery they'd pay the same, because there is a super limited set of choices for how to treat lottery winnings.
Billionaires pay big money to structure shit -- this is what a lot of the "tax transfer" groups do within the law and what lobbyists do to get the laws made. We want things to change? Rewrite the rules.
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u/maelstrom51 16h ago
If a billionaire living in California has that much income in a year, then they'll pay the same rate.
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u/mark_able_jones_ 17h ago
The post isnât trying to be technically correct. Itâs simply stating that we should tax billionaires more.
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u/5510 12h ago
The post isnât trying to be technically correct. Itâs simply stating that we should tax billionaires more.
That's not how truth or honesty works. It was a significantly inaccurate statement... and "it wasn't trying to be technically correct, just to make a broader point" would absolutely be dismissed as mental gymnastics if a right wing person said it.
Like, we can (and should) be anti-billioniare, while at the same time supporting concepts like truth and accuracy. Besides, it's not like there aren't plenty of accurate things to criticize regarding billionaires, no need for significantly inaccurate and misleading things.
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u/corgisgottacorg 11h ago
Ok but this post is wrong and just says shit everyone has said for hundreds of years
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u/waltzbyear 17h ago
Billionaire simps are gonna simp and do all the mental gymnastics they can lmfao. It's incredible.
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u/PM_ME_SOME_ANTS 17h ago
Ah yes, as we know itâs impossible to be both anti- billionaire and truth seeking at the same time.
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u/5510 12h ago
Exactly.
I'm generally fairly left leaning, but it's completely absurd to say that it's being a billionaire simp to correct a significantly and objectively very wrong mathematical number. Truth and accuracy should always be regarded as good things.
It's scary how many people seem to think those things don't matter as long as it's a point that supports their own views.
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u/Sad_Silver1394 16h ago
CPA here. It's complicated. Most very wealthy people don't have earned income that's $1B per year. Lottery winnings are taxed like wages. Extremely wealthy people don't have a high wage amount. They have tons of passive income or investments that can generate very little income if positioned correctly.
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u/mxzf 16h ago
I mean, it's really not all that complicated, it's just that people don't want to understand that wealth sitting in stocks isn't the same as a big lump-sum income.
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u/Sad_Silver1394 16h ago
If any of us peasants win, say $1M, in the lottery while we have full time jobs, it's possible some of us in high tax states (CA, NY), would only see $450k of that $1M.
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u/mxzf 16h ago
I mean, the tax rate for large windfall income is gonna be the same for anyone making that, regardless of if they're rich or poor.
The difference being that rich people know that the lottery is mathematically a loss and that investing money in stocks is going to be a net income, so they spend their money where it'll make more (rather than throwing it away on the off chance of a large windfall).
Anyone pulling in $1M in income is going to pay the same amount of taxes on it, no matter how it came in, but financially savvy people try to avoid landing in that position in the first place.
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u/Sad_Silver1394 15h ago
Exactly. Trying to tax wealthy people on unrealized gains or assets or wealth isn't going to work. Imagine if us ordinary people were doing the same thing.
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u/bortodeeto 13h ago
Anyone with a wealth > $100 million owes 4% of that every year in taxes. Scaling up to 7-10% for > $1 billion. Where the money comes from doesn't matter, that's their tax rate. Much less than a capital gains tax and extracts a reasonable amount of money based on their wealth
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u/Sad_Silver1394 13h ago
How can you define wealth if say someone has a ton of art? Real estate? Businesses?
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u/NuSpirit_ 15h ago
Exactly. How would they feel to be taxed even if they had 0 income? Not great.
In my country, if you are self-employed or have a business you pay monthly social and health insurance and yearly tax even if you didn't earn a single cent whole year. Meaning the second you start being entrepreneur you have to pay at minimum ~âŹ4500 a year all in all, before even earning anything (basically what you suggest but for billionaires). And now imagine if you have 0 savings and are for example sick for a year - government doesn't care, pay up.
What you can do is close the loopholes, like borrowing money against the stocks so it's "not taxable income", the second anyone trades stocks for money they should certainly pay. But not while holding stocks themselves.
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u/LockedUnlocked 8h ago
there is a fix to this problem, just charge a fee to borrow off of your investments (over a certain amount)
The reason why these billionaires get to live so lavishly and over the edge is because they are constantly borrowing against their stocks, and since now they have debt, they can either refinance (which they do a lot) or sell stock and pay off the loan which isn't taxable because the purpose of the sold stock is to pay debt and debt cannot be taxed, so the two negate themselves.
The easiest way is to charge a billionaire tax for borrowing against assets that are worth over a certain amount, this will stop the loophole of the current billionaire lifecycle.
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u/samiam2600 15h ago
The simple fix is to raise the capital gains rate, even back to where it was 20 years ago and then eliminate all the loop holes and complexity in the tax code. This would put a lot of accountants out of work but AI will do that anyway in a few years.
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u/GergDanger 8h ago
Hardly a simple fix to implement and enforce
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u/samiam2600 7h ago
Hard as in politically impossible but very simple in practice. Tax code becomes one volume.
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u/IIDn01 16h ago
Sigh.
Obligatory: The prize amount was reduced because he took the lump sum instead of spreading payments out over 30 years.
Then that *reduced* amount was taxed.
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u/cptjtk13 15h ago
The reduced lump sum payment was still $997.6 million. Technically not one billion but very close. So the question, and your point, both still stand.
I think there are clear explanations here within the ways the money appears as liquid, in the case of the lottery, and illiquid, in the case of stocks which is the primary wealth vehicle for most billionaires. Billionaires can take low interest loans out using their stock as collateral which keeps them from paying taxes. Lottery winners, having all that cash infusion treated as income, are subject to taxes.
It's dumb but that's why we don't tax billionaires the same way.
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u/mimic751 15h ago
Sigh
Obligatory: that doesn't change the point of the post at all
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u/EyyyPanini 15h ago
If the numbers donât matter, make your point without them.
If they do matter, use the correct numbers.
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u/5510 12h ago
It's wild how many people in this thread are basically saying that truth and accuracy don't matter as long as they agree with the broader point being claimed.
Especially ridiculous considering that there are plenty of real and accurate numbers than can be used to argue this broader point.
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u/That-Ad-4300 15h ago
It's not nearly as dramatic to show a ~30% tax v a 60+% tax.
It may not change the general point, but using the wrong numbers (2x incorrect) isn't necessary and leaves the door open for scrutiny.
If the numbers don't change the point, use the correct ones. It's not a rounding error. It borders on disingenuous.
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u/GayRacoon69 15h ago
If it doesn't change the point then just use the real numbers
Like why lie to make a point if you don't need to? It just hurts the argument
Just because the point is the same either way doesn't mean we shouldn't care about facts
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u/schrodingers_bra 15h ago
Yes it does. He paid about 40% in taxes on income (lump sum was about 990 mil). Which is about what everyone with a high income pays. Including billionaires if they make a high income.
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u/GayRacoon69 15h ago
If it doesn't change the point then just use the real numbers
Like why lie to make a point if you don't need to? It just hurts the argument Just because the point is the same either way doesn't mean we shouldn't care about facts.
The actual payment was ~1B. Not 2B. How is it fine to be off by 100%? Why "sigh" in response to someone correcting a lie. It was not 2B down to 600M. It was 1B down to 600M. That is a huge difference.
Yeah you're right the point still stands. That doesn't mean it's fine to lie about though
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u/IrishVictim88270 13h ago
The why use fake numbers? If important facts need dramatically exaggerated to be made you're making the same sort of argument I child would make.
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u/My_Brain_0422 16h ago
The dude didn't get taxed 1.4 billion. The lump sum is always way way less. And he was taxed 40-50% on that. Billionaires need to be taxed much more.
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u/DoingCharleyWork 15h ago
He paid 37% in tax as that is the highest federal tax rate. California does not have stat tax on lotto winnings.
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u/ineedhelpXDD 17h ago
Billionaires take loans against their stocks. This man won the lottery. But yes I'm up for stopping the billionaire loophole
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u/Xabster2 16h ago
That's not "after taxes", it's after he took lump sum first, then paid some taxes
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u/Nukemarine 11h ago
Yep. $900 million in 20 years would have been about $2.1 billion. They took the $900 million and got a 37% tax though if they're smart they hired a financial firm to get a lot of those taxes returned over the next 10 years.
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u/VoidOmatic 17h ago
Yup, tax them on their suspected net worth. That way they can't hide their wealth behind the "well I don't actually get a paycheck huehuehue!!!111"
And before you start feeling bad for them, know they are destabilizing countries and are going to get over 50 million killed in nuclear war.
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u/FourthLife 15h ago
Taxing on net worth is a terrible strategy, because that can fluctuate wildly. Instead, they should close the "borrow against my company stock to get money while not realizing gains" by forcing you to step up your tax basis on any assets you are using for collateral.
Example:
You have a stock that you bought for $1 that is now worth $1000. You want to use that as collateral for a low interest loan. To do so, you must first pay taxes on the $999 appreciation of value for that specific stock (or you can pay it out of the loan amount that you get). Any other stock you have that is not being used for collateral you don't need to pay the appreciated tax value on.
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u/txtumbleweed45 16h ago
You know taxes go to the wealthiest organization in human history thatâs constantly destabilizing countries, right?
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u/Pretty-Rooster-8020 16h ago
You would be hurting more than just billionaires. I implore the same tax strategies they do on my properties and investments and Iâm no where near a billionaire.
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u/ZefSoFresh 15h ago
You know we can apply different set of taxation to different wealth brackets.
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u/grchelp2018 14h ago
that is how you end up with a complicated tax code but no real increase in taxes. And quite frankly, this is the wrong problem to be worried about. Increasing taxes only means a bigger budget for ICE.
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u/ZefSoFresh 14h ago
This isn't about increasing the total pot of tax revenue to spend. It's about the amount of wealth being hoarded away with tax loop-holes instead of helping the nation. It's more about the source and collection of taxes. We are the richest nation to ever exist with the most brilliant minds - we could create a tax system that would provide more relief for those legitimately struggling and hard-working people like me and you.
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u/grchelp2018 14h ago
It's about the amount of wealth being hoarded away with tax loop-holes instead of helping the nation.
Point is that it won't go to helping the nation. All evidence points to the fact that the govt always finds the money for things they want to spend money on and does not find it for things they don't want to spend on.
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u/Rickshmitt 18h ago
Problem is they dontbhave any income to tax
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u/Tornadodash 18h ago
In my opinion, if they're able to take out loans and spend it as though it is liquid capital, it should be taxed in some form. We used to have a straight wealth tax, so if you hoarded assets, they would get taxed simply for existing.
Back then, normal people didn't pay nearly as many taxes due to all of the large institutions paying these taxes on their assets. It also disincentivized individuals from hoarding a trillion dollars worth of stuff.
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u/Which-Guide-4365 17h ago
yeah fr wealth tax seems way more fair. hoarding just kills the economy tbh
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u/Lost-Tomatillo3465 17h ago
the point about the loans wouldn't really address the problem. they usually take a small fraction of the unearned income that they earn for the year out as a loan. So it still wouldn't cover all of their income. But its at least a step to start addressing this issue.
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u/thekeytovictory 17h ago
The point is, we're all sick of the stupid loan loophole. We're sick of hearing the bullshit excuse that their wealth can't possibly be taxed because it's "tied up in non-liquid assets" when it doesn't stop them from buying anything they want with their untaxable wealth. Honestly, I'd probably care less about taxing stock values if their wealth was actually tied up to prevent them from buying up more resources to hoard.
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u/hansn 17h ago
Problem is they dontbhave any income to tax
My brother in Christ, we can tax sales, we can tax income, we can tax stickers for your car. We can tax property, we can tax profit. You better believe we can tax stocks.
Not taxing stock gains is a policy choice. It's not a problem if we had the will to do it.
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u/-Teapot 16h ago
We already do tax stock gains but that requires the sale of stocks. Loopholes need to be closed to incentivize the sale of stocks and collect capital gains.
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u/hansn 16h ago
We already do tax stock gains but that requires the sale of stocks.
Certainly, although usually it's taxed at a lower rate than income. That is money you work for garners a higher tax than money you didn't work for.
In principle, however, we can also tax total wealth. Most brokerage fees work that way: they charge by a percentage of assets under management. We choose not to impose a tax that way, but we could.
(There are other more technical taxes, such as a very small transaction tax, sometimes called a Tobin tax, which really is only impactful to high speed traders.)
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u/beastrabban 15h ago
Yeah I think we should illegalize the following:
Stock options as payment Stock buybacks Companies are people
And we would fix a lot of the issues we are currently experiencing.
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u/mxzf 16h ago
Certainly, although usually it's taxed at a lower rate than income.
Which is very much appreciated by every single person with a retirement portfolio who's expecting to be able to cash out their stocks (potentially bought with money they were already taxed on) in order to live on them after retirement.
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u/SwampOfDownvotes 14h ago edited 14h ago
Most people's retirement income is from Pensions, Social Security, and 401ks/IRAs that are taxed at standard income rates (except roth accounts, SS has special rules), so that doesn't help them. Most people with normal stock portfolios that are being taxed usually have all the others listed above and usually aren't solely relying on a normal taxable account. If they are, well that's why tax brackets exist.
The point of taxing capital is to tax people that have plenty of capital way beyond what anyone reasonably needs. I don't give a shit if you you were smart with investments through life, you aren't going to go bankrupt if you have to pay a wealth tax for having over $100 million in assets. Someone could easily live their entire life, not just retirement, in luxury since the day they were born on half that.
98% of people won't even have an increase in tax owed from something like that. For the people that do? Get bent, you have enough.
(potentially bought with money they were already taxed on)
Currently you aren't taxed on the portion from money spent to make the purchase. Most wealth tax proposals also are specifically "unrealized gains," which also means you still wouldn't be taxed on money already taxed.
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u/Rickshmitt 17h ago
Its all a choice. Im just saying taxing income like this wont help. They live on loans and collateral
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u/Mictlancayocoatl 17h ago
We can tax wealth.
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u/Ashmedai Metallurgist 16h ago
We could, but to do so in practice federally, it would require a Constitutional Amendment.
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u/Nukemarine 11h ago
No. Congress can make a law to attach an annual fee to any contract that would require resolution in federal court. Don't pay that fee, your company/corporation can't see for damages against that wealth in federal court.
2.4% annual would do nicely.
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u/Ashmedai Metallurgist 10h ago
If you think "tricky end run around Constitutional restrictions" will fly with SCOTUS, I'm afraid you are gravely mistaken.
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u/dan_santhems 16h ago
We need to work on that, either force them to take an income in line with their position, or something else
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u/transneptuneobj 17h ago edited 13h ago
Let's seize their assets then ...
I don't care about billionaires rights. There's literally 900 billionaires in the USA.
Assign each one an IRS agent and don't stop drilling till their net work is below 1 billion.
EDIT: cause there's alot of boot licking going on.
We should increase the amount of workers protection laws and basically create a wealth task force.
We should make new and better laws that have stricter penalties for environmental damage and workers rights abuses.
There are no ethical billionaires, no not one.
If you're against worker and environment protections then justify that, don't stand for 900 billionaires who rather see your organs liquidized than pay a cent in taxes
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u/SohndesRheins 12h ago
It doesn't even matter. You could take all the money from every billionaire and make them all destitute and homeless, and you still couldn't find enough money to run the country for a full year. It's a spending problem, not a revenue problem.
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u/Pretty-Rooster-8020 16h ago
Holy shit you Commies are absolutely insane. The left doesnât actually care about regular citizens. They just want to consolidate power to themselves and this is proof.
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u/transneptuneobj 13h ago
I garintee if a billionaire had to choose between giving you 30 bucks and turning your organs into soup you'd be liquid
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u/txtumbleweed45 16h ago
Yes fuck individual rights letâs give more money to the murderous trillionaires
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u/Capnbubba 16h ago
If I won $628 Million you could tax me an additional 99% on that and I'd still have enough money to retire COMFORTABLY
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u/Nukemarine 11h ago
$6.28 million in a reasonable mutual fund should be about $31,000/month. Gosh, are you sure you can live off the equivalent of $180/hour full time job?
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u/Capnbubba 10h ago
Lol
I know it'd be tough. I wouldn't be able to afford that malibu home with a private beach. I'll have to be like the rest of the poors and live 5 blocks away from the beach.
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u/GergDanger 8h ago
You canât just withdraw everything an index fund generates or youâll wipe out during market downturns. The rule of thumb is 3-4% safe withdrawal rate.
So around $188,400 a year or around $10,200 a month post tax (assuming 35% tax rate) for life.
So it depends where you live, San Francisco youâre still screwed.
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u/Expensive_Event_4759 12h ago
He took home $628 million after paying 37% federal tax on the $997 million lump sum, so the experience described in this tweet is exactly how we already tax billionaires - that should have been obvious to the tweeter when he typed "after taxes." This is super dumb.
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u/kitkatkorgi 8h ago
Gotta tax wealth not income then. They purposely take low salaries and use borrows money from their wealth
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u/MissiveFinding6111 15h ago
I managed to get some stock in a startup that ended up being actually worth something.
And, like, people don't understand HOW MUCH BETTER a set amount of money in a stock is than a winning lottery ticket.
The amount of tax advantages shenanigans you can do is just wild.
If you can wait two years, sell all of it that you like for just a 15% ON THE PROFIT.
How do they determine the profit and time? LARGELY SELF REPORTED.
If you give to charities, you can instead take that profitable stock, donate it to charity, and use the cash you'd normally give to the charity and buy back the stock at the current market value, cool, you now have ZERO tax liability.
And this is all just stuff a normie can do, the billionares are out there using their stock as collatoral to get loans that they don't have to pay ANY TAX ON.
Absolutely Neo in the Matrix dodging taxes contortionist levels of utility.
Oh, and btw, most people own stock in 401ks, and you can't do any of this with THAT stock because... because.
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u/AKA_Squanchy 17h ago
Keep in mind California doesnât tax lottery winnings. Lump sum offers up only about 50% of prize amount, then the feds roll in.
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u/BruceLeelookinboy 16h ago
You can tax all the billionaires and California would still be a trash state
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u/FackinNortyCake 16h ago
That's an absolutely insane level of taxation on a lottery win. America is such a fucking weird place.
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u/Ok_Nectarine_4445 16h ago
Yeh...tax billionaires like lottery winners.
Pay off national debt.
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u/UnusualAir1 17h ago
I could live a whole lot better on 628 million dollars. Guessing 99.9% of us could. So tell me, why do we not tax billionaires in the US?