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No, they do not. Their average tax rate is over 23%. In comparison, 45% of all US 1040 filers pay a 0% effective Federal Income Tax rate. 0% is an extremely low effective tax rate. Let's ALL pay a 0% tax rate.
If you know anything about accounting, you would know that most deductions are phased out as income increases.
Nope. Read the info I posted earlier, published by the CRS. Those earning $300K pay an average effective rate of about 14%.
What makes you think hedge fund managers don't pay FICA on their salaries? The carried interest tax rate is only charged on their profit sharing, not on their salary.
As usual, you're under-informed.
Compensation for services aka salary is supposed to be subject to the regular income tax rates. Due to a loophole, in this example, it is not.
Evidently the sky is the limit for corporate CEO's in our county that now make around 300 times the average worker, back in the 1960's it was 20 times.
Meanwhile middle class wages have been stagnant since the 1980's.
I really don't care how much CEO's make. If you want to make more $$, get educated or learn a skill.
Yes. The SS tax is capped, but then so are the benefits. Do you wish to remove the cap on SS benefits for the rich? We could go that way. The Medicare tax is not capped.
Compensation for services aka salary is supposed to be subject to the regular income tax rates. Due to a loophole, in this example, it is not.
What makes you think they aren't paid a salary? The amount subject to the carried interest tax is their bonus. It's paid as profit sharing, a direct proportion of how well the fund is doing. If the fund isn't doing well, their bonus reflects that.
Evidently the sky is the limit for corporate CEO's in our county that now make around 300 times the average worker, back in the 1960's it was 20 times.
Meanwhile middle class wages have been stagnant since the 1980's.
The CEO jobs are not appointed by the government. You are more than welcome to apply so that you don’t have to be stuck in the stagnant middle class pay.
What are you incessantly whining about? SS is a progressive program. Low-income earners benefit the most, and middle class and higher-income earners actually LOSE money on SS.
Quote:
"As recently as 1985, workers at every income level could retire and expect to get more in benefits than they paid in Social Security taxes, though they didn't do quite as well as their parents and grandparents.
Not anymore.
A married couple retiring last year after both spouses earned average lifetime wages paid about $598,000 in Social Security taxes during their careers. They can expect to collect about $556,000 in benefits, if the man lives to 82 and the woman lives to 85, according to a 2011 study by the Urban Institute, a Washington think tank.
Social Security benefits are progressive, so most low-income workers retiring today still will get slightly more in benefits than they paid in taxes. Most high-income workers started getting less in benefits than they paid in taxes in the 1990s, according to data from the Social Security Administration."
To be clear the largest deductions are charitable - 60% of AGI, and use of the charity lead annuity trust.
Those other deductions, targeting low income earners are small potatoes in comparison.
There may be others that I am not familiar as very high net worth was not my client base.
What makes you think they aren't paid a salary? The amount subject to the carried interest tax is their bonus. It's paid as profit sharing, a direct proportion of how well the fund is doing. If the fund isn't doing well, their bonus reflects that.
Not true, there is also a management fee.
As usual, you are under informed.
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The Medicare tax is not capped.
