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‘The company has been short-changing the tax collection agency for much of the past decade. Mr. Buffett’s company has not fully settled its tax bills from 2002-2009. Yet he says he’d happily pay more.”
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Full Disclosure: I own shares in Berkshire Hathaway Inc.
35 comments
1 |
Charles Johnson Fri, Aug 26, 2011 9:29:31am |
Where's the hypocrisy? If his company believes he's been improperly billed for taxes he doesn't owe under the current laws, why is it "hypocritical" for them to appeal the bills?
Just another ridiculous attempt to promote right wing talking points and smears.
| 2 |
Buck Fri, Aug 26, 2011 9:37:57am |
You jump to that "right wing talking points and smears" almost immediately. It is your default setting. Did your really read the story?
The IRS has made a determination. They have told him how much tax he is required to pay.
Yes, he can appeal it... endlessly. However, appealing a decision says to everyone that he wants to pay LESS taxes. You don't fight your tax bill if you really want to pay more.
That is the hypocrisy.
| 3 |
andres Fri, Aug 26, 2011 9:57:21am |
re: #2 Buck
I was going to write a thoughtful answer, but the "woosh" is to strong in you.
| 4 |
gehazi Fri, Aug 26, 2011 9:59:50am |
I *know* that arguing with you is pointless, but..."someone is wrong on the internet." I'll keep it succinct.
A. I will take every tax credit or break I am entitled to under law and am willing to spend time and money to reduce my personal tax-rate.
B. The US needs to have higher tax rates and/or lower tax breaks to improve its financial situation.
These two statements are in no way contradictory. You can't meaningfully expand tax revenues from the generosity of just a few wealthy citizens, you have to institutionalize it.
| 5 |
Buck Fri, Aug 26, 2011 10:15:48am |
re: #4 gehazi
A. I will take every tax credit or break I am entitled to under law and am willing to spend time and money to reduce my personal tax-rate.
OK, But once the IRS tells you that you took a tax credit or break that you were NOT entitled to? What do you do then?
I mean this is not a 2010 thing.... this has been going on for a decade. It is easier to be successful if you don't have to worry about a level playing field. The competitive companies have paid their taxes.
| 6 |
Political Atheist Fri, Aug 26, 2011 10:25:50am |
Buck, I think you make a fair point in #5. So 1 up, and I'm disagreeing with many here with that. OK.
But events overwhelm the situation.
I'll say it like this-
Everyone who found income and s/s taxes terribly or unfairly burdensome after the Regan cuts raise their hand.... Who the heck believes in not raising taxes to account for 2.334 wars and state assistance and after revenues plummeted in the recession/bubble? (Remember past wars were off book)
Resisting raising taxes and opposing the deficit at the same time is a far, far larger hypocrisy. Buffet pales by comparison.
| 7 |
gehazi Fri, Aug 26, 2011 10:32:35am |
OK, But once the IRS tells you that you took a tax credit or break that you were NOT entitled to? What do you do then?
Myself personally? Pay it. Myself as a large corporation (beholden to my shareholders) with tax attorneys that probably do nothing but help me optimize my taxes? Follow their legal advice, which (IANAL) is probably to contest it as long as possible.
The competitive companies have paid their taxes.
Oh I'm sure all the other corporations always pay everything on time and never endlessly contest for various tax breaks with the IRS. Definitely sure. Maybe probably sure. Ok: entirely unsure, even suspicious, you might say.
Look, I'm not happy about an unreadable tax code with intricate tax breaks and credits that are designed by their obscurity to only be taken advantage of by those who can afford tax attorneys. Can anyone really be happy about that? (Besides the tax attorneys!) But it's precisely ridiculous tax breaks like these that Buffet has been clamoring against!
It is easier to be successful if you don't have to worry about a level playing field.
What an excellent point. How about we drastically reduce the complexity of the tax code so that Buffet doesn't have to bother with silliness like this while at the same time raising tax revenues. We can tie those revenue increases to some spending cuts and call it, for lack of a better term, "the plan Obama and congressional Democrats came up with in during the debt ceiling craziness." We can focus-group the title, but I think the plan is a real winner in Congress.
The only group such a plan really hurts is tax lawyers, but I'm pretty sure we can divert some of the new government revenue to provide them with career re-training.
| 8 |
KingKenrod Fri, Aug 26, 2011 10:32:38am |
re: #5 Buck
OK, But once the IRS tells you that you took a tax credit or break that you were NOT entitled to? What do you do then?
I mean this is not a 2010 thing... this has been going on for a decade. It is easier to be successful if you don't have to worry about a level playing field. The competitive companies have paid their taxes.
It's not hypocrisy to take actions based on the government you have instead of the government you want. Buffett never said he wanted to pay more taxes while everyone else gets to enjoy less taxes. If other companies fight the IRS and win, then BH is at a competitive disadvantage if they don't fight.
This is also the reason why I don't think Michelle Bachmann is a hypocrite for accepting crop subsidies or running a clinic that bills Medicare. You live with the government you have, not the one you want.
| 9 |
Buck Fri, Aug 26, 2011 10:37:49am |
re: #4 gehazi
And who is talking about generosity? His companies are fighting the institutionalized tax rules. He has received a tax bill....
Look I certainly understand fighting a tax bill, but to be going around and saying that he would be happy to pay at the same time as he owes more....is hypocritical.
Not illegal... I didn't say he was breaking any law... However there is nothing about generosity either.
| 10 |
jaunte Fri, Aug 26, 2011 10:41:46am |
Buffett wasn't just talking about increasing his own taxes.
But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.
My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice. [Link: www.nytimes.com...]
| 11 |
gehazi Fri, Aug 26, 2011 10:47:27am |
re: #9 Buck
Should have known better than to get involved in a Buck thread. Still, I'll respond to your nitpick over my choice of the word "generosity" once you respond to my #7.
| 12 |
Buck Fri, Aug 26, 2011 11:02:09am |
re: #11 gehazi
Should have known better than to get involved in a Buck thread. Still, I'll respond to your nitpick over my choice of the word "generosity" once you respond to my #7.
I don't see anything in your #7 to respond to. I am not talking about the tax code. I am not even talking about making changes to the tax code.
Personally I think if Obama and Democrats want to increase taxes for millionaires they should write a bill that details that. They should vote on said bill. Not make speeches about it, not talk about who doesn't want to raise taxes, but to stand up, IN WRITING and be counted as the person to raise taxes.
BUT IMO that is off topic for this discussion.
| 13 |
Buck Fri, Aug 26, 2011 11:03:50am |
re: #8 KingKenrod
It's not hypocrisy to take actions based on the government you have instead of the government you want. Buffett never said he wanted to pay more taxes while everyone else gets to enjoy less taxes.
The government he has tells him to pay more taxes.
| 14 |
gehazi Fri, Aug 26, 2011 11:10:13am |
re: #12 Buck
I don't see anything in your #7 to respond to. I am not talking about the tax code. I am not even talking about making changes to the tax code.
Maybe that's why the entire discussion is absurd: Buffet is talking about changing the tax code, and ignoring that makes talking about his alleged hypocrisy meaningless.
Hypocrisy against what statement? He didn't just offer to pay more (it would be hypocrisy if so) he stated that the tax code unfairly benefits him and that it should be changed. The tax code is the whole point.
Oh, and I didn't bring it up earlier, but you're trying to conflate a statement about his personal finances with a statement about the finances of the company he runs. He can do what he wants with his own money, but he has a responsibility to his shareholders for the company's money. It would be unethical to elect to pay more taxes than his attorneys deem acceptable (within the ability of the company to appeal) when it's not even *his* money under dispute.
But I won't continue until you address my points in #7. I know your style, you grab on technicalities and ignore wider and more important points and I refuse to be entangled further.
| 15 |
Buck Fri, Aug 26, 2011 11:31:20am |
re: #14 gehazi
Buffet is talking about changing the tax code, and ignoring that makes talking about his alleged hypocrisy meaningless.
The tax code says pay more, and has been saying it for years.
I am sorry if you don't get it.
| 16 |
funky chicken Fri, Aug 26, 2011 11:32:36am |
re: #7 gehazi
Does anybody here actually believe Warren Buffett is involved in calculating, paying, or appealing his corporation's taxes? It does sound like his attorneys and accountants are working hard to make themselves seem indispensable.
| 17 |
KingKenrod Fri, Aug 26, 2011 1:14:03pm |
re: #13 Buck
The government he has tells him to pay more taxes.
The government also created a process where disagreements can be fairly disputed and resolved.
| 18 |
Achilles Tang Fri, Aug 26, 2011 1:43:49pm |
Read your own article and some of the comments in the link.
A: It's not his money. It's the corporation and the shareholders, including you apparently.
B: It is the duty of the management to dispute tax bills if they believe they are not correct, and in this case they are no doubt very complex.
| 19 |
Buck Fri, Aug 26, 2011 1:52:38pm |
re: #17 KingKenrod
The government also created a process where disagreements can be fairly disputed and resolved.
True, and I point that out.
However... that doesn't mean it is NOT hypocritical to say that you "wish you could", or "think you should" be paying more taxes when you are fighting the assessment.
King says: "take actions based on the government you have instead of the government you want."
I point out that "The government he has tells him to pay more taxes." He is not taking actions based on the government he has, and he is being hypocritical when he describes the government he wants.
He says he wants a government that takes more taxes... and he has a government that takes more taxes.... Yet he doesn't pay the additional, legally assessed taxes...
Maybe we just don't have the same understanding of the word...
1. a person who puts on a false appearance of virtue or religion.
In this case the false appearance is that he wishes to pay more taxes, when his actions show that he clearly does not.
2. : a person who acts in contradiction to his or her stated beliefs or feelings.
His actions of not paying the IRS assessment is in contradiction to his stated belief and feeling that the super rich should pay more taxes.
Perhaps his secretary could pay less (as a percentage of her income) taxes than him, if she also chose to fight her assessment, and not send in the assessed amount.
AND we know about the fighting of the assessment because of the publication that he publishes. Any idea that he does not know about this is ridiculous to the extreme.
| 20 |
Buck Fri, Aug 26, 2011 1:59:21pm |
re: #18 Naso Tang
Read your own article and some of the comments in the link.
A: It's not his money. It's the corporation and the shareholders, including you apparently.
B: It is the duty of the management to dispute tax bills if they believe they are not correct, and in this case they are no doubt very complex.
A... and that is the people and organizations that he is saying should pay more taxes
B... Yes, true, but it is hypocritical to also say that the rate should be higher at the same time that you are fighting to make it lower.
I AM NOT SAYING HE SHOULDN'T FIGHT THE TAXMAN. I hope he wins. I just find his public stand on the subject of taxes to be in contradiction to his private stand.
| 21 |
Achilles Tang Fri, Aug 26, 2011 4:25:22pm |
re: #20 Buck
A... and that is the people and organizations that he is saying should pay more taxes
B... Yes, true, but it is hypocritical to also say that the rate should be higher at the same time that you are fighting to make it lower.
I AM NOT SAYING HE SHOULDN'T FIGHT THE TAXMAN. I hope he wins. I just find his public stand on the subject of taxes to be in contradiction to his private stand.
A: You still don't understand. Yes, you, as a shareholder, should pay more taxes than the 15% on investment profits you face if you hold for 12 months before selling. Everyone else in every other category has to pay more, directly or indirectly; why not you?
B: It is not hypocritical for the lawyers of a public company to do their job, for you, to maximize return after taxes, within the law. So far, as far as I know, there is no allegation of illegality in this, and I doubt that Buffet personally has anything to do with the details.
C: (your C:) I repeat, this is not a personal Buffet income liability. This is a major public corporation, which you hope to profit from, doing what the law applies, in your interest.
You are also free to forego any "excess" profit you may see as a shareholder and donate something extra to the IRS. Nobody is calling you a hypocrite just because your interest is smaller than Buffet's.
I am however tempted to do so.
| 22 |
Buck Fri, Aug 26, 2011 7:25:35pm |
OK, I might have missed one small part in my definition of hypocrite in my #17. I forgot
3. Must be a Conservative or Republican only.
(jeez you guys are drowning in the koolaid.)
| 23 |
Buck Fri, Aug 26, 2011 7:38:30pm |
re: #21 Naso Tang
Nobody is calling you a hypocrite just because your interest is smaller than Buffet's.
I am however tempted to do so.
How can you say that? What did I say that was in anyway hypocritical?
What definition are you using? My interest is smaller? How is that in anyway related to anyone being a hypocrite?
1. a person who puts on a false appearance of virtue or religion.
2. : a person who acts in contradiction to his or her stated beliefs or feelings.
Please explain.
| 24 |
BishopX Fri, Aug 26, 2011 7:47:21pm |
re: #19 Buck
Buck. I assume you are Canadian? If you you might want to consider that this is a US government matter and you really have no idea what you're talking about. When the IRS finds an issue with a tax return, they typically send out a letters saying that they have reviewed your returns and found an error which means you owe X more. At this point the IRS gives you two options, you can a) enclose a check for X and settle the matter or b) send a letter in contesting the finding and hash it out with the IRS. If you decide to go with option B) and your claim drags on past a certain point you can be charged interest on the amount in dispute.
BH chose option B. They decided it was more likely that the someone screwed up, either within the IRS (faulty judgement) or within BH (somebody screwed up some paperwork). This happens all the damn time. For a while I worked in a tax office, out the 600 or so clients we would get at least five or six of these things per year. Given the number of years involved (2002-2006) I'm going to guess that it's a tax law dispute rather than a paperwork error. That still doesn't mean the IRS is right and BH is wrong, it just means that part of the IRS thinks BH is wrong.
| 25 |
Achilles Tang Fri, Aug 26, 2011 8:30:15pm |
re: #23 Buck
How can you say that? What did I say that was in anyway hypocritical?
What definition are you using? My interest is smaller? How is that in anyway related to anyone being a hypocrite?
1. a person who puts on a false appearance of virtue or religion.
2. : a person who acts in contradiction to his or her stated beliefs or feelings.Please explain.
You are calling out Buffet for dishonesty, if not hypocrisy. You are in the same boat as he since you are also a shareholder, and size doesn't matter.
I really do think this is obvious.
| 26 |
Buck Fri, Aug 26, 2011 8:48:40pm |
re: #25 Naso Tang
You are calling out Buffet for dishonesty, if not hypocrisy. You are in the same boat as he since you are also a shareholder, and size doesn't matter.
I really do think this is obvious.
You clearly cannot read. I am not in the same boat because I am NOT saying that the rich should pay more taxes. There is no contradiction in my position.
| 27 |
Buck Fri, Aug 26, 2011 9:01:50pm |
re: #24 BishopX
You must think I am an idiot. First of all, I know how it works. Secondly it has nothing to do with the subject.
He says publicly that he’d happily pay more, except the IRS has apparently been asking him to pay more going on nine years and in private he is not paying it.
That contradiction is what is commonly known as hypocrisy.
Now you can make up a whole bunch of stuff that may or may not be true. However that is commonly known as rationalization.
| 28 |
BishopX Fri, Aug 26, 2011 9:33:41pm |
re: #27 Buck
You must think I am an idiot. First of all, I know how it works. Secondly it has nothing to do with the subject.
He says publicly that he’d happily pay more, except the IRS has apparently been asking him to pay more going on nine years and in private he is not paying it.
That contradiction is what is commonly known as hypocrisy.
I don't think you're an idiot (it would be much easier to argue with you if you were).
I think we need to clarify some thing here: Buffet is saying that the way the code is structured favors the super-rich over everyone else, and that the tax code should be changed so that the super rich pay more taxes.
BH is disagreeing with the IRS about whether or not they owe some amount of taxes on several years worth of returns. As part of that process they have not paid the amounts the IRS claims are outstanding. This is a normal part of the process. Once they have settled it they will presumably pay the amount agreed upon and any additional interest or charges that may arise.
Right so far?
Your argument that because a) Buffet is arguing for an increased personal tax rate and B) Berkshire Hathaway is behind on its taxes C) Buffet is a therefore a hypocrite.
Is this your argument?
Assuming everything is right above, and not getting into whether C logically follows from A&B (i.e. the definition of Hypocrite), I'd argue that you're still wrong. In order for B to be true the IRS has to right about how much BH owes and BH has to be wrong. Otherwise BH is not behind on their taxes. As it stands right now, we don't know whether or not the IRS is right. You are assuming they are, but we don't actually have any information which we can use to determine whether they are right or wrong. So until the IRS and BH settle their disagreement over whether or not BH owes the IRS money it is impossible to evaluate claim B.
Mr. Buffet may or may not be a hypocrite, and no one (not even Mr. Buffet or the IRS) can say whether or not he is until the taxes in question are settled. At which point BH will pay for amount decided upon and B will be false.
Now if you could present any evidence that Buffet intentionally withheld payments from the IRS that he believed to be legitimate, prior to a settlement. That would be evidence of hypocrisy.
| 29 |
Achilles Tang Sat, Aug 27, 2011 5:31:08am |
re: #26 Buck
You clearly cannot read. I am not in the same boat because I am NOT saying that the rich should pay more taxes. There is no contradiction in my position.
No, there is no contradiction, just the hypocrisy of you who wishes to profit from the same legal/accounting issues as the one you criticize for doing the same because he has expressed the opinion that the tax rates are unfair.
I can just see the Tea Party taking your lead and calling for taxation to be by voluntary contributions./
| 30 |
Buck Sat, Aug 27, 2011 10:38:03am |
re: #29 Naso Tang
there is no contradiction, just the hypocrisy of you who wishes to profit from the same legal/accounting issues as the one you criticize for doing the same because he has expressed the opinion that the tax rates are unfair.
That makes no sense. In order for there to be hypocrisy, there has to be a contradiction.
I am NOT criticizing trying to pay less taxes, I am pointing out the hypocrisy of saying that he thinks everyone (including corporations) earning more than a million dollars should pay a higher rate of taxes, when he is at the same time trying to avoid paying the rate that exists right now.
So, to summarize, I am not being a hypocrite, and I am not criticizing.
I am simply pointing out an obvious hypocrisy. Which I have detailed clearly.
1. a person who puts on a false appearance of virtue or religion.
In this case the false appearance is that he wishes to pay more taxes, when his actions show that he clearly does not.
2. : a person who acts in contradiction to his or her stated beliefs or feelings.
His actions of not paying the IRS assessment is in contradiction to his stated belief and feeling that the super rich should pay more taxes.
It is really that simple.
| 31 |
Buck Sat, Aug 27, 2011 10:55:00am |
re: #28 BishopX
Mr. Buffet may or may not be a hypocrite, and no one (not even Mr. Buffet or the IRS) can say whether or not he is until the taxes in question are settled. At which point BH will pay for amount decided upon and B will be false.
No, you don't understand this at all. It is not that lack of PAYING the taxes that is the hypocrisy. The fact that sooner or later he will pay the assessment is incidental.
It is the act of fighting the current tax rate, while telling others they should pay more.
You are missing the whole definition of hypocrisy. I am not saying he is doing anything illegal (not paying the taxes would be illegal AND a hypocrisy). By fighting the assessment, he is not doing anything unusual EXCEPT when he says that he wishes he could pay more.
You are hung up on how the tax fight is important, I am saying that it doesn't matter. It doesn't matter if he wins or loses. It is the telling everyone that he thinks everyone and every corp that earns more than a million dollars should pay more taxes, while fighting (legally, and normally) the assessment his companies have received.
Would you think that a Republican Governor who campaigns against the a stimulus, but when the money is handed out takes every penny he can get for his state is a hypocrite? Remember taking the money is in the best interest of his State, and people of his State. It is his job to take the money. IMO it doesn't matter.... it is his act of opposing the stimulus that makes him the hypocrite. Not the actual taking of the funds.
Anyway... we can just disagree. You don't have to see the hypocrisy.
| 32 |
Achilles Tang Sat, Aug 27, 2011 1:29:46pm |
re: #30 Buck
I am NOT criticizing trying to pay less taxes, I am pointing out the hypocrisy of saying that he thinks everyone (including corporations) earning more than a million dollars should pay a higher rate of taxes, when he is at the same time trying to avoid paying the rate that exists right now.
You don't know that he (your investment management) is trying to avoid any legitimate tax. It would seem that there is a disagreement on how to calculate that tax under the present spaghetti laws.
As to higher rates in general, this is an old argument that only teabaggers like you can't see. Tax rates are now lower than they have been in 50 years, profits are higher than they have been in years, the richest are richer than everyone else compared to all countries except sorry ass dictatorships; but the "job creator class" is still not hiring.
You however think that everyone except the richest, including corporations, should pay for the national debt directly or indirectly, and on top of that the latter should be given even more breaks, just in case what has never worked in the past will work in the future.
You know what they say about people who do the same thing over and over again and expect a different result each time.
| 33 |
Buck Sat, Aug 27, 2011 4:31:20pm |
re: #32 Naso Tang
You however think that everyone except the richest, including corporations, should pay for the national debt directly or indirectly, and on top of that the latter should be given even more breaks, just in case what has never worked in the past will work in the future.
You should not tell me what I think. You are not very good at it.
| 34 |
Achilles Tang Sat, Aug 27, 2011 6:31:52pm |
re: #33 Buck
You should not tell me what I think. You are not very good at it.
This is true to some degree, although I think that you think I missed your evasion of the discussion at hand.
| 35 |
Buck Sun, Aug 28, 2011 10:11:02am |
re: #34 Naso Tang
This is true to some degree, although I think that you think I missed your evasion of the discussion at hand.
What? I evaded nothing. You are trying to change the subject. For example you keep calling me "a tea bagger", which has nothing to do with the post. In my mind the POST is the "discussion at hand". I don't know what discussion you might be having, but my not participating in your insulting attempt to bait me into a completely different discussion is not evasion.
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