You could reframe it as:

The tax benefits are there to incentivize philanthropic giving. Society benefits from their giving and they receive a tax benefit and PR boost in return. It's not like they're saving more money total by giving it away. And sure, it'd be nice if philanthropists were super humble and anonymous, but the money helps either way, and I don't think those who are helped by the giving care if the givers have a statue of themselves up somewhere.

The core claim above is that ultimately the foundation is a lip service activity to preserve wealth. If a hundred billionaire pays out 1 billion dollars in philanthropy via the foundation, but earns 10 billion tax free then they are doing quite well.

It's a trivial matter to write the terms of the foundation such that yourself/successors can draw permanent income via "board" positions, advisory roles, or other means.

How would that work exactly? Genuine question, I've never understood how donating saves on taxes, you have to pay at some point to access the money, no?

In theory, you could donate to a charitable org you control, live on its properties, travel for "business" reasons, so on and so forth tax free.

There's also the unfortunately more common interpretation I see on reddit where somehow people believe that tax deductions are generally greater than the donated amount

I think the idea is that you "pay" the charity instead of the tax man.

This in turn allows you to take income from the charity (as an advisor/board member/fake title) so you're getting some back (with 40% taxed as income) via charity "employment".

Then as a cherry on top, you get to push headlines that you are altruistic and have buildings named after you.

Also, your friends can be advisors/board members for your charity and donate you gifts.

This is how - https://techstartups.com/2021/04/30/bill-gates-turned-55-mil...

First you buy stock in your selected list of companies. Next you pledge suitable sums of money to charity programmes. Then you use your power and influence in ensuring said companies get all the big contracts. Your foundation is funding these programmes of course, so you can influence whom they partner with. The stocks of those companies shoot up and you profit. The funding is effectively more of a strategic investment than a donation. The tax savings are just a bonus.

Think about why Gates, who is in the philanthropy business, fought so hard to ensure Oxford don't put out their vaccine in the public domain? Oxford wanted to do so but Gates stepped in "suggesting" they partner with a well known entity like AstraZeneca instead. Of course, when you are a benefactor to an orgranisation, your suggestions tend to do more than just suggestions. AstraZeneca's terms were that they get exclusive IP and licensing rights and you know the rest.

In some aspects it is controlling how your TAXES are spent by cutting out the middle man.

I don't see how this is generally desirable though.

Replacing the government middleman with a rich-person & associated bureacracy middleman. At least the government is meant to be accountable to the people.

This exactly, and because of the absurd magnitude of wealth some people have they are setting policy with their foundations. Basically governing without ever being elected.

The whole philanthropy argument is irrelevant PR.

This wealth wasn't created in a vacuum.

I’ll start paying heed to this line of reasoning when a significant portion of tax revenue is spent bombing innocents. There’s very shaky moral grounds for many of our actions overseas, and I don’t blame any rich person for wanting to control policy for significant philanthropic efforts.

Does Oil & Gas fall under offshore efforts?

Gold & uranium?

There's always something some where worth taking, smoke and mirrors of democracy pave the way.

One country's terrorist is another country's freedom fighter.

We can in theory vote for people that wont bomb innocents we can't vote out the rich people in any meaningful way.

The laws that allow this philanthropy are controlled by us. We most certainly can vote them out of existence

We can't vote their wealth out of existence easily when they own the legislators.

It is a tool, you are right. But not the solution so it should not be so heavily encourage.

What should be encourage: a better distribution of the profits in the value production chain. At amazon, Wallmart, all the employees should be obscenely well paid (relatively to their job), the enormous profits should not be concentrated at the top.

How would someone at that level of wealth give in a more empathetic way? What should Bill and Buffett be doing instead?

Buffett always complains that he did not pay enough tax. He could simply wire 50% of his fortune to the IRS. His secretary had no choice. (End of sarcasm)

They should donate to a foundation. They should not have link with it (direct or indirect). Their family (direct or indirect) should not have link with it (direct or indirect).

The problem with these structures is that they allow someone to control and directly benefit from assets without fiscally owning them. Usually these foundations have complex structures and use generous fiscal code of some countries.

For many, the main goal is to lower the fiscal pressure during transmission to the children.

I think the real thing is that Buffet knows that wiring your fortune to the IRS is a perilously stupid way to do good with your money; just statistically such a huge chunk of that will go to, say, bombing children halfway around the world, bureaucracies that spend money better than actually provide healthcare, and anti-poverty programs that are better at lining the pockets of 'social entrepreneurs' that are better at writing grants than providing services to the poor.

If you do actually believe that the federal government is the most efficient way to redistribute wealth, at least earmark it to killing the debt, which is an unethical institution (you cannot go back in time and vote against spending that your generation is forced to pay off; it's taxation without representation)

https://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm

It’s fine if he thinks it’s stupid, but then he shouldn’t complain that he doesn’t pay enough either as if only he could pay more then he would do so. BS!

I don’t have a problem with the guy or with his wealth, but the whole “oh but if they’d only tax me” thing is infuriating.

Hell, he could just endow any number of non-Ivy League schools and pay for kids to go to college.

I have a genuine question do you know what Buffets philanthropies do or his plans with his wealth? Or are you just reacting to talking points?

I'm reacting to his talking points - I'm not sure what his philanthropies will do with his wealth, but I assume not give it to the IRS so I think the point still stands.

Anybody who wants to pay more taxes can write the IRS a check. It's very easy to do.

Exactly this. I don't even make nearly as much as warren Buffett and I'm actively contributing to an unrelated kid's (single mom, service worker, spotty job reliability) college fund.

You just have to step up and do it one day, or, if you're warren buffet, tell your personal assistant to set it up.

This argument gets played frequently but it misses the a point. Buffet is not complaining that he has not been able to send enough money to the government he is complaining that the system has no way to take the money from people like him. It’s is meaningless to send more money as the complaint is about the system and how it deals with the overall group he is a part of.

The consistent criticism is that Buffet has not put in enough lobbying to change the system. He could afford building of lobbyists and not farms and burned out influencers manipulating public consensus. Now that’s a a decent criticism. But no one should ever have to pay more than they must, just to have an opinion on their own government.

I think by the very nature of saying that he should be taxed more is sufficient enough. Why would anyone pay money to lobbyists to then have to pay more taxes. He provided political cover and conversation around it. Sufficient enough IMO. Ridiculous to think he would spend money to increase his own tax burden - if people can't get it done themselves than that's on them.

I’m sorry what?

Buffet shouldn’t have just cut the IRS a check for $2B because it’s “meaningless to just send the money”?

So unless all the pieces are in place there is no value in paying the amount in taxes you publicly claim you should pay?

That’s like saying alcohol should be illegal, but drinking all the time. “Well, there is no point in me not drinking, the point is to change the law”.

That makes zero sense.

Buffer should've done same but opposite what Koch brothers do: fund powerful think-tanks, but left of center, to promote progressive tax and eliminating loopholes and limitation of business taxes and capital gains taxes, I guess also promoting estate taxes for a good measure.

Disagree. Why would you arbitrarily pay the IRS money if you didn't owe them anything. It would put himself in a weaker competitive position against his competitors and for what benefit?

I completely disagree with you. The move should be to change the system.

You pay them because your argument is “i should be paying more”.

It’s hard to take someone seriously when they say they should pay more tax, have every opportunity to pay more tax, yet choose not to pay more tax.

He's arguing that the system should charge him more and his class of citizens more. Why would he arbitrarily pay more if noone else in his cohort is paying more? Doesn't make any sense.

What you are saying is he should make a donation to the US government.

No, those are just weasel words. It’s setting an example by doing what you’re saying others should be doing.

It’s why we have the phrase “put your money where you mouth is”.

And it’s not a donation. It’s intentionally paying more taxes because that what you think you should be doing. If the law changed he’d be paying the extra money anyways.

Well maybe you could consider it 'paying more taxes' internally but in reality it would be classified as a donation otherwise the US government would give him a refund for overpaying his taxes. And to my prior point I don't see how that gets anyone else on board.

The law won't change retroactively so I don't see "If the law changed he’d be paying the extra money anyways." makes any sense.

Your argument is illogical because it implies that people should be able to alter the tax law by intentionally overpaying taxes.

The argument is usually that you personally making the change isn't significant. Even $2B from Buffet isn't significant on a "US government" level. So making that change would "hurt" Buffet a lot for not much gain.

Changing the law, on the other hand, is significant, because it impacts every millionaire/billionaire.

No, this is bullshit. “Hurt” Buffet? Hurt him how? Wouldn’t the higher tax rate “hurt” home too.

This is just a bullshit billionaire who won’t do what he’s asking others to do.

>Buffett always complains that he did not pay enough tax. He could simply wire 50% of his fortune to the IRS. His secretary had no choice. (End of sarcasm)

Wealth is competitive. Over time, having a higher rate of return than someone else results in substantial differences in overall wealth. Everyone in his position being on the same playing field and chipping in equally is not the same as him martyring himself and letting more selfish peers acquire more resources and sway.

Said better than I in fewer words

Frankly if I was a billionaire and had the means to setup my own charity that I had complete visibility into so I knew exactly where every penny was spent I would do that over giving it to another foundation.

Agree. Unfortunately today a Foundation is mainly a optimisation structure. Most of the countries have usually other structures (in their fiscal code) to encourage people to help.

Sticking your nose in "where every penny was spent" is not great and I imagine for most people it would lead quickly to micromanagement. What do you know about charities, about running charities? Anything? Give anonymously. To people who already know what they're doing. You're a billionaire, you can afford list price for benefit events.

millions of Americans struggle with basic expenses. Such expenses are recurring. even if he gave half, it would not last long enough to fix those problems.

Agree - which is why he says it's a systemic problem that needs fixing.

All of these, frankly, stupid arguments that he should just give the IRS money for no reason because they don't tax him high enough is ridiculous. Literally a drop in the bucket. Full year budget - $4.89 Trillion in 2019.

Paying as much taxes as they can. And why not more? IIRC the 1040A has a field where you can give the government as much extra money as you want.

Oh but it doesn't get spent with your name associated, so that's obviously not a good option for egomaniacs.

$0.15 of every dollar given would also go toward defense spending, which some find objectionable...

If SpaceX can reduce launch costs, we need one of these uber billionaires to launch rockets with some kind of exploding black powder to create a dot-matrix picture of themselves on the moon.

Yes and no, in the case of charities, our tax system encourages this behavior intentionally. Obviously there are those who take advantage more than others, but often you would find that it's not easy to do so without actually breaking the law.

Can someone create a Dutch-shell-companies-as-as-service (DSCaaS), generate and submit all legal documents automatically, and help normal citizens dodge the same amount of taxes?

I was actually offered this as a service by a company doing formations in the Seychelles (they were spamming people) - quite literally had a spammer tell me "no, don't buy my product, it isn't worth it"

They basically said the cost of company formation (doesn't really matter where, but anywhere that matters, like Panama or Seychelles or BVI or Macau or etc), mail handling monthly payments, virtual office payments, legal and accountant time, etc exceeds more than 99% of peoples' actual tax payment. That includes people making 500k. And that there is virtually no point in doing so. Doubly more if you are US based due to reporting requirements and massive additional costs for that.

IANAL, but based on what I've been told you are not able to easily do this if you are employed by a normal company - it requires that you hold a company in the first place to have intellectual property, branding to be able to licence cross-shell [easiest compared to trying to shuffle physical items of value around], etc, and that the company gets the payment, so people making 500k FAANG salaries are out as they are FTE employed.

And that your cost of finding the 'correct' accountant that has experience in this will far exceed your previous accountant cost.

I suspect there's a large fixed cost to arrange this so it doesn't make sense for most people. Though maybe there's way to make it cheaper!

Also with inheritance tax in the US, your estate isn't taxed unless it's worth more than $11.18 million [0]. So doesn't matter for most people. It's estimated only %0.2 of estates pay the tax.

[0] https://en.wikipedia.org/wiki/Estate_tax_in_the_United_State...

I suppose a lot of the fixed costs are lawyers charging $1000/hour to fill in some blanks on some Word templates?

Maybe an entrepreneur just needs to make that a web form. Fill in details and generate the same form for $10 instead of $1000.

And then some robots to print, seal up, and mail the envelopes and we're done.

I should be able to spin up a Dutch shell company like an EC2 instance. Maybe have "AWS" regions for Cayman and other places too and a Python API to spin up shell companies in arbitrary locales.

Each pod in a Kubernetes cluster should register itself as a separate LLC and declare bankruptcy on shutdown. Free cloud deployments!

Could there be one Dutch Shell Company Company and individuals could enter into a contract with it to pass their wealth through to avoid taxes?

Forget it. Tax offices are chasing the big fishes so they have all the tools to catch and bother the small inexperienced ones. Also running these structure is actually very expensive and complex. Normal citizen have only 2 possibilities: cash economy or move to place fiscally more adapted to their needs (each country favor a type of fiscal profil).

Anyone with any money should setup a trust. Especially if they want to marry. Done right it’s an amazing way to protect your wealth. Better protection than a prenup can provide.

>Anyone with any money should setup a trust

Anyone in the US with any money should setup a trust

Where can I read more?

You don't need to be religious to recognize that there is occasional wisdom in the bible.

IMO most of the “exceptional” people in a country “by of and for the people” are hypocrites for waiting on billionaires to fix things

How is political capitulation by the masses exceptional?

Covid offered a perfect opportunity for info workers to show solidarity with on-site workers by not opening those laptops at home.

But really it’s the leopards fault they keep eating our faces because we refuse to build a cage (higher taxation, breaking up monopoly).

The solution is not new either as we just went through it in recent memory with ATT.

I’m rather tired of the general public pointing fingers at everyone but themselves.

Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it.

>Stop going to the jobs they offer. It’s our agency not theirs. Demand they respect it.

A general strike? You're asking for people to cooperate in a mass prisoner dilemma on a societal scale. Never going to happen with the complete lack of labor organization in the US.

General strikes occur are strange occurences. The few examples such as France in 1968, or the Soviet Union in 1991, or the Praque Spring in 1968 occurred for reasons more akin to "mass social unrest/dissatisfaction" than organized labor activity.