IRS records reveal how the wealthiest avoid income tax

Re:IRS records reveal how the wealthiest avoid income tax by bitcurious on Tuesday June 08, 2021 @08:04AM (#27433991)

For the sake of argument, assume a flat 20% tax rate for a minute.

Scenario A: Your taxable income is $1,000,000. Your tax liability is $200,000. You pay your taxes, you net $800,000.

Scenario B: Your taxable income is $1,000,000. Your tax liability is $200,000. You donate $200,00 to charity. Now your taxable income is $800,000 and your tax liability is $160,000. Your net income is $640,000.

The only scenario where a charitable contribution doesn’t lower your overall income is

Scenario C: you commit fraud.

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Re:IRS records reveal how the wealthiest avoid income tax by justanotherguy0 on Tuesday June 08, 2021 @10:20AM (#27435545)

You're forgetting that you can donate appreciated assets for their market value without realizing the capital gains as income.

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Re:IRS records reveal how the wealthiest avoid income tax by rattray on Tuesday June 08, 2021 @08:15AM (#27434103)

Scenario D: You donate $800,000 to a foundation you control. Your net income is $960,000 ($160,000 cash and $800,000 with some strings attached).

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Re:IRS records reveal how the wealthiest avoid income tax by kristjansson on Tuesday June 08, 2021 @08:38AM (#27434324)

If they cut a string, or even pull on one a bit too much, they’re right back at C.

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Re:IRS records reveal how the wealthiest avoid income tax by zentiggr on Tuesday June 08, 2021 @10:49AM (#27435909)

Assuming anyone can get the AG to actually investigate, file charges, and get a conviction.

Notoriously more difficult as the amount of financial leverage increases.

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