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View Diary: BREAKING: Warren Buffett just released his tax return!!! (105 comments)

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  •  It's a very enviable rate. (7+ / 0-)

    The last few years, my spouse and I have paid approximately 27% of AGI.

    It's not about deductions.  For that matter, the deductions that you cite do not reduce AGI, they reduce taxable income.  If you happen to be subject to AMT, you don't really get any deductions anyway, which is a big part of my problem.

    No, the real problem is simply how various types of income are taxed.  If you're already sitting on a big pile of assets, you might receive most of your income from qualified dividends, capital gains, and tax-free bonds.  That's how you get to a low rate.  But if you still work for a living and make your money in the form of W-2 salary, you get to pay regular rates (or worse).

    "They let 'em vote, smoke, and drive -- even put 'em in pants! So what do you get? A -- a Democrat for President!" ~ Faster, Pussycat! Kill! Kill!

    by craiger on Wed Oct 12, 2011 at 01:47:22 PM PDT

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    •  You have to make a lot of dough to pay (0+ / 0-)

      that %.  Or you're adding SE tax to the mix, which I suspect you may be doing.

      •  If you say so. (5+ / 0-)
        Recommended by:
        Justanothernyer, Chi, Lujane, carpunder, Debby

        I am a salaried staff engineer with a major corporation and my wife is a schoolteacher.  No self-employment tax.  This is Federal income tax due divided by AGI, pure and simple.

        I don't deny, we have a very comfortable joint income.  Point is, we don't make nearly as much as Warren Buffett.  The highest tax burdens do not fall on the people who make the most money.  Far from it.

        "They let 'em vote, smoke, and drive -- even put 'em in pants! So what do you get? A -- a Democrat for President!" ~ Faster, Pussycat! Kill! Kill!

        by craiger on Wed Oct 12, 2011 at 02:11:26 PM PDT

        [ Parent ]

    •  Thats possible (1+ / 0-)
      Recommended by:
      billlaurelMD

      If you earn more 400,000 and have no mortgage and live in a no state tax state.

      •  Q.E.D. (1+ / 0-)
        Recommended by:
        johnny wurster

        When you're subject to AMT, the state tax deduction is disallowed, so it doesn't necessarily matter whether there is a state tax or what the rate is.  In California, it happens to be a relatively high rate, and I pay that too.  (And it's worth every penny to live here.)

        "They let 'em vote, smoke, and drive -- even put 'em in pants! So what do you get? A -- a Democrat for President!" ~ Faster, Pussycat! Kill! Kill!

        by craiger on Wed Oct 12, 2011 at 02:53:57 PM PDT

        [ Parent ]

    •  Taxes versus net worth of $39 Billion (1+ / 0-)
      Recommended by:
      Lujane

      Warren Buffett is worth $39 Billion per Wiki. His income of $63 million is 0.16% rate of return.  In other words while his net worth may grow by 10% per year (most years it has been much higher) he only pays taxes on the taxable portion which was only $63 Million.  This is true with most mega rich, their assets may be in real estate which grows in value tax free or in stocks which also grow in value tax free.  Only the tip of the iceberg is taxable!  If his net worth grew by 10% that translates to$3.9 Billion increase in net worth and he paid less than 2 tenths of 1 percent in taxes!

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