Prince Harry of Santa Barbara County

A1Janitor said:
The very rich don’t take income - they borrow loans against their assets.

But not taking income is a reduction of expenses, so their corporations pay taxes. It washes.
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The problem is the accountants are a hell of a lot smarter than the people writing and enforcing the tax laws. If people really want taxation to be fair, we should go to a flat tax. But that would put a lot of government employees out of work, so it will never happen.
 
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A1Janitor said:
The very rich don’t take income - they borrow loans against their assets.

But not taking income is a reduction of expenses, so their corporations pay taxes. It washes.
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Are Corp officers considered employees … isn’t their compensation treated differently ?

What about board members?
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Korab said:
Stock options are taxed, though maybe not in the year exercised, depending on which type. But the government always gets its piece eventually.
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This is spot on. Depending on the type will determine that, but there have been changes in how they account for them. More companies are opting for Non-qualifed Stock Options (NQSO) vs. Restricted Stock Units (RSUs).

When I exercise my NQSOs, I wil pay the exercise or strike price to obtain them (whether I keep them or not). I will pay 33.30% taxes to fed, state and medicare. Then of course, my bonus and salary are taxed as well. I'm very blessed, but at some point I have to question how much I pay. It would be a different story if I saw a satisfactory return. I don't.
 
Korab said:
The problem is the accountants are a hell of a lot smarter than the people writing and enforcing the tax laws. If people really want taxation to be fair, we should go to a flat tax. But that would put a lot of government employees out of work, and drastically reduce the billable hours paid to Attorneys, Accountants and Lobbyists. so it will never happen.
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This discussion of proves one thing for sure; The architects of current tax code have created a system so opaque that regular folks can't clearly see the fundamental issue, which is large amounts of income are never even taxed. As a small government Adam Smith liberal, I will always advocate for the lowest possible income tax rates, but we will never get there with the ever growing list of sacred cows, exemptions, carve outs and loop holes.

Like @Capt MJ, our heads hurt after arguing over what is a fair marginal tax rate, estate taxes, government waste, etc. We are too tired to understand what exactly is carried interest or stepped up cost basis, the terms created by the architects of the current tax code.
 
If we get rid of stepped up basis, estates should report assets and be taxed at net cost rather than fmv. ;)
 
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