Hacker News new | ask | show | jobs
by solosoyokaze 1906 days ago
Are you suggesting that the rich would break the law and engage in tax evasion (not legal loopholes)?

A great portion of my taxes goes to military and police. Wouldn’t they just collect the money push come to shove? They certainly have the capability, but possibly not the will.
1 comments
g00gler 1906 days ago
It’s relatively easy to pay less taxes than your true compensation once you get past the rank-and-file level of employment.

As income taxes rise there’s a clear pattern of altered compensation like stock grants, expense accounts, etc.

For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes.

Instead of giving you $40,000 in cash which would cost 30% in FICA between you and the company plus personal income tax to you, you can live in a nice $3500/mo apartment you would otherwise be paying for in after tax dollars.

Instead of you paying $800/month+ for a Tesla model X lease with your after tax dollars the company can pay for it, write it off, and again they’re saving 15% on taxes and you’re saving > 40% on that $10,000 and pocketing more of your after tax income.

link
gruez 1906 days ago
>For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes.

I'm not an accountant or a tax lawyer, but it doesn't look like that's the case according to the IRS's website. Housing is only exempt if it's "Lodging on your business premises"[1]. A tesla would also likely not be exempt for a typical office worker[2]

[1] https://www.irs.gov/publications/p15b#en_US_2021_publink1000...

[2] https://www.irs.gov/publications/p15b#en_US_2021_publink1000...

link
sneeze-slayer 1906 days ago
Other countries solve this by taxing it as a "benefit in kind". It is compensation, and should be included in how one is taxed.
link
filoleg 1906 days ago
It is a thing in the US too. For example, I have to pay income tax on the annual "fitness reimbursement allowance" the company provides for us.

Very simplified version: we can spend up to $1k/yr on fitness related expenses and get them reimbursement. We submit a reimbursement request, and if it gets approved, I get the money back in my account. The HR page explicitly warns that any reimbursement received will count towards your income tax.

link
solosoyokaze 1906 days ago
I don't think you can tax the rich with income tax, for the reason you state. I think you need a wealth tax.
link