Tax Loopholes often, first, about, example

ishfaque

Serious Post (it's a first)

What are some tax loopholes that these politicians rave about the rich exploiting? I hear this phrase so often but I have yet to hear a real example.

Is this politicalspeak to appease the voters?

jmh530

Muni Bonds

ayaz_mahmud369

I recall Ross Perot being slammed for this. He paid something like an 8% effective income tax rate due to his massive muni bond investment portfolio.

This thread could also serve as a nice resource for us rich CFA AFers come tax time.

smuggycfa

Perhaps because I view "tax loophole" as having a negative connotation, I wouldn't categorize muni's as a tax loophole. The tax-exempt status for most muni's simply serves as a way for the federal government to help promote local development projects. If muni's weren't tax-exempt, towns and states would have to pay higher interest rates to attract buyers, effectively increasing the cost of every project and probably killing a lot of those projects.

transferpricing

But... munis give you lower yield than taxable securities. So, supposedly, your tax savings are offset by the interest that you lose.

sameeragarwal

Not every dollar of income is taxed the same way. Ergo, loopholes.

stockjaguar

higgmond Wrote:
-------------------------------------------------------
> Perhaps because I view "tax loophole" as having a
> negative connotation, I wouldn't categorize muni's
> as a tax loophole. The tax-exempt status for most
> muni's simply serves as a way for the federal
> government to help promote local development
> projects. If muni's weren't tax-exempt, towns and
> states would have to pay higher interest rates to
> attract buyers, effectively increasing the cost of
> every project and probably killing a lot of those
> projects.

+1.

15% Tax on Dividends? LTCG? Limited Partnerships? I dunno, I'm not rich, just some places to start your search.

b_sea93

Jerry: So, we're going to make the post office pay for my new stereo now?
Kramer: It's a write-off for them.
Jerry: How is it a write-off?
Kramer: They just write it off.
Jerry: Write it off what?
Kramer: Jerry, all these big companies, they write off everything.
Jerry: You don't even know what a write-off is.
Kramer: Do you?
Jerry: No, I don't!
Kramer: But they do. And they're the ones writing it off.

LorrinCFA

NakedPuts Wrote:
-------------------------------------------------------
> Jerry: So, we're going to make the post office pay
> for my new stereo now?
> Kramer: It's a write-off for them.
> Jerry: How is it a write-off?
> Kramer: They just write it off.
> Jerry: Write it off what?
> Kramer: Jerry, all these big companies, they
> write off everything.
> Jerry: You don't even know what a write-off
> is.
> Kramer: Do you?
> Jerry: No, I don't!
> Kramer: But they do. And they're the ones
> writing it off.


+1 Absolute classic, its called mail fraud Seinfeld, all you'll have to do is pay a small fine....

hassan

Stocks & Blondes Wrote:
-------------------------------------------------------
> NakedPuts Wrote:
> --------------------------------------------------
> -----
> > Jerry: So, we're going to make the post office
> pay
> > for my new stereo now?
> > Kramer: It's a write-off for them.
> > Jerry: How is it a write-off?
> > Kramer: They just write it off.
> > Jerry: Write it off what?
> > Kramer: Jerry, all these big companies,
> they
> > write off everything.
> > Jerry: You don't even know what a write-off
> > is.
> > Kramer: Do you?
> > Jerry: No, I don't!
> > Kramer: But they do. And they're the ones
> > writing it off.
>
>
> +1 Absolute classic, its called mail fraud
> Seinfeld, all you'll have to do is pay a small
> fine....


NICE!!!!!!!!