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Some friends got five “laying hen” chicks a few years ago. They were guaranteed to be hens and they were. And they laid more eggs than we all could absorb.
Then, when they had passed their egg laying prime, our friends replaced them with five more. This time, they got three banty hens who lay pidgeon-size eggs and two roosters.
The luck of the draw, I guess . . .
[quote=”DavidCMurray”]And people whine about hungry folks getting Food Stamps!
I just wonder how many country club memberships the executives of any of those negative tax payers were finally able to afford with their corporate welfare.
What percentage of the federal government’s deficit spending would have been offset by just the $2.488 [b]B[/b]illion you’ve listed, Scott? And how much more did you miss?
What do you suppose would have been the impact on the deficit had just these corporations paid income tax, at the lower corporate rate, on their $115.16 [b]B[/b]illion in profits?
[/quote]
I woke up in the middle of the night trying to do the math on the numbers Scott has provided. If I’m managing the decimals correctly, the $2.488 [b]B[/b]illion in negative taxes (taxes that you and I paid) these companies received would have provided almost 178 million meals to Food Stamp recipients at New Jersey rates.
I wonder how the Hurricane Sandy victims feel about that . . .
And people whine about hungry folks getting Food Stamps!
I just wonder how many country club memberships the executives of any of those negative tax payers were finally able to afford with their corporate welfare.
What percentage of the federal government’s deficit spending would have been offset by just the $2.488 [b]B[/b]illion you’ve listed, Scott? And how much more did you miss?
What do you suppose would have been the impact on the deficit had just these corporations paid income tax, at the lower corporate rate, on their $115.16 [b]B[/b]illion in profits?
[quote=”Scott”]It should be mentioned that Stewart Title does of course charge for this service which can add many thousands of dollars to the transaction costs in buying a property in Costa Rica.
If anyone does contact them, it would be good if you could please report back to us here in the Forum and let us know what sort of fees they do charge these days…
Scott
[/quote]So are you saying that you don’t actually know if Stewart charges a lot for their escrow services, Scott?
I can’t speak to the differences, nor to the advantages and disadvantages of either, but there are “revocable” trusts and “irrevocable” trusts. If it were not an important distinction in law, there probably wouldn’t be both types.
There are differences, too, between trusts and the “partnerships” to which critterhill referred early. The two terms are not interchangeable.
[quote=”critterhill”]
Another issue is the expense of setting up a trust/partnership which I’ve been told can run in the $5 – $10 thousand range. If taxes don’t break you, lawyer fees will![/quote]
The figure you quote, $5 – $10,000 to set up a revocable trust is much more than what I think I’ve been given to understand [b]as things were in Michigan a few years back[/b]. Nevertheless, spending $10,000 to avoid a 55% tax on kwhite1’s mother’s $800,000 land value in excess of the pending $1 million exemption seems like a bargain.
Lessee . . . $800,000 x 55% tax = $440,000 in tax minus (say) $10,000 attorney’s fees = a net savings of $430,000.
Yup, it’s a bargain!
kwhite1, we can play the cards we’re dealt or we can wait until someone changes the game (maybe for the better; maybe not). If your mother’s holdings are liable to taxation at the time of her death under the current rules then now is the time to be doing some estate planning assuming the worst case scenario.
Or, as an alternative, you can devote your energies to complaining and wishful thinking. That, of course, would appear to be the expensive way to go.
Victoria, why does your trust need to be offshore? Have you actually consulted anyone about setting up a revocable trust in your home state or are you assuming something based upon facts you haven’t fully investigated?
You’re pretty much free to handle the cash transaction any way that you’re comfortable with. I do wonder just what protections the parties might have if they do the real estate title transfer in one jurisdiction and the cash transaction in another.
The recommendation to consult Stewart Title Latin America, based here in Escazu, is a good one. I think they offer escrow services that may afford some protections. Stewart may be able to accept a wire transfer from the U.S. and escrow it here, but I’m not sure about that.
My understanding is that it’s neither illegal nor frowned upon to move amounts of more than $10kUS to Costa Rica but there are reporting requirements. If you have any foreign account with a balance of $10kUS at any time during any tax year, you (we Americans, that is) must report it to IRS. There’s no penalty or tax; it’s merely a reporting requirement. And it’s simple.
It’s true that Banco HSBC de Costa Rica’s operations were never integrated with those of HSBC Bank USA, so having an account at the latter would not have done you any good with the former. And now, Banco HSBC is Davivienda anyway.
[quote=”puravidatexan”]Since David C is certain that the estate tax taking the family farm is a myth, perhaps he could solve my family dilemma. My Mom owns a beautiful place on the river that has been in my family for 150 years. When the new estate tax hits on January 1, 2013, the rate is set to be 55% with an exemption of $1 million. The close to 300 acres is valued on county tax rolls at $1.8 million. So if my 85 year old Mom dies in January, how do I pay the $440,000 that is due? And the government deserves to benefit–how?[/quote]
I certainly have no professional expertise in estate planning, so I can’t offer any concrete suggestions other than to get with a tax professional and start working out a plan now. I think I know, however, that family assets are often put into revocable trusts so that when the current owner dies, there is no taxable event.
Yes, I am vehemently opposed to all the existing flat taxes (of which there are plenty) and any new ones. It isn’t a matter of fairness, which they are not. It’s a matter of the remaining disposable income.
Consider a family living on (say) $30,000 a year. If they paid the 17% Steve Forbes proposed in 1999, they’d have about $25,000 left to meet their living expenses. Contrast that family with one earning (say) $300,000 per year who would have to eke out an existence on just $250,000. The latter might be constrained to belonging to just two country clubs while the former would be living on Gravy Train — the dog food, that is. Would the impact on the children, innocent in this scenario, meet your definition of fairness?
(As an aside, responsible economists calculated that Forbes’ rate would have to be closer to 22% to equal then-current government revenues.
Try this simple experiment: from your last year’s federal income tax return, write down your total gross income, the income the flat taxers would propose to tax. Then write down your own net tax. Now, compare the net tax you actually paid to 22% (or 17%, if you prefer) of your total gross and tell us (honestly, now) which amount you’d rather pay.
And if you divide your actual income tax payment by your gross income, you’ll get your “flat tax” rate. I’ll bet you’ll be shocked at how much less than 17 or 22 percent you paid.)
Making profit, interest, dividend, rent and other unearned income taxfree would certainly be a godsend for the already uberrich, loraine. Those are the greatest sources of their incomes. So you and I could pay to educate their children, pave their roads, process their water and sewage, provide their security, build their airports, and a thousand other public functions while they’d be free to spend all their wealth on expensive trinkets.
But why stop with not taxing their unearned income? How about we exempt them from sales taxes, property taxes, excise taxes, gas taxes, as well as all taxes on earned income, too? After all, they’re God’s chosen people, right?
It’d be Paradise on Earth (if you were one of the lucky few).
