Apple Paid $6 Billion in Federal Income Tax in 2012, 1/40 of All U.S. Corporate Income Tax Collected

[afireintonto]

There is one scenario (actually a pretty good one) where I agree it would make sense to eliminate the distinction between capital gains, dividends, and ordinary income. That would be if we eliminated the corporate income tax.

I agree that one income source should be counted the same as any other income source. But i disagree with you on corporations paying income tax. If a corporation wants the same legal rights as a person, they should pay tax just like i do or you do or anyone else. They are a person right?

I don't see it as double taxation, the corporation pays one tax (as an individual), and so do you (your an individual too)

 

[KPOM]

AS for capitol gains, I could see the tax rate being equal to regular income tax. There are many people who make their careers out of buying/selling stocks and takes a certain skill set to master doing it profitably. So why shouldn't it be taxed like regular income?

Short term capital gains (i.e. less than a year) are taxed as regular income. That does capture most of the profits from professional stock trading. There is nothing really magical about holding a stock for more than year, but the idea is that those investors are more likely to have benefited from stock price appreciation, which is ultimately driven by corporate profits (subject to corporate tax).

If we eliminated the corporate income tax, likely it would be coupled with an end to the distinction between ordinary income and capital gains at the individual level.

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I agree that one income source should be counted the same as any other income source. But i disagree with you on corporations paying income tax. If a corporation wants the same legal rights as a person, they should pay tax just like i do or you do or anyone else. They are a person right?

I don't see it as double taxation, the corporation pays one tax (as an individual), and so do you (your an individual too)

Yes and no. They are legally considered "persons" (that is actually a very old distinction). The primary benefit is limited liability. As a shareholder of Apple, I am not liable for any of their obligations. Corporations don't vote, or get entitlements, or drive on roads (people who work for corporations do, but they are taxed as individuals). Corporations do use the legal system, but there are better ways (such as fees) of paying for that then general income taxes. Corporate income taxation is a very inefficient way of financing government.

 

[KdParker]

This is the logical fallacy in the anti flat-tax argument. You assume that having spare pocket money would empower upwards economic mobility, which I disagree to.

I would even go as far as to say they're entirely uncorrelated, since the sums were talking about are minor in the grand scheme of things.

Let's assume that as a middle class family you'd save 12k/year extra from XYZ's major super awesome give away freebies tax plan. If you're the average family, as you would imply, you're likely to spend part of that on frivolous and materialistic items, and the rest as investment towards retirement. Assuming however that you save this money for 20 years, we're talking 240k in flat savings (assuming your fund kept an even, ****** keel). A decent chunk no doubt, but oops, doing that bumped you into a higher bracket, and there's a higher tax rate on investments under XYZ mega super awesome tax plan. All those gains become rather marginal, and 240k is hardly a noteworthy transition to millionaire status. That's not to say that you can't make the most out of those investments, but those that do are likely moving forward due to other factors.

Rather, I contend that upward economic mobility most often correlates with these factors:
-Luck
-Hard work
-Education
-Access to capital (ala trusts, vc's, angel investors, etc)

And extra cash gives you to access education, which makes it more likely that you can find avenues for capital and the know how to take advantage of opportunities that present themselves.

Plus... you are only taxed at a higher rate for money earned over 400k.

 

[GRuizMD]

Fine, but note that the expiration of the payroll tax cut is expected to bring in 1.5 times as much money as raising the top rate from 35% to 39.6%.

I don't own a gun, but don't begrudge someone else owning one. I'm guessing you live in an urban area (such as NYC) since you seem to not understand the difference between automatic weapons (which are illegal) and semi-automatics. Just about every gun (including hunting rifles) are semi-automatic now because of the recoil.

In general, my observation is that people at the highest end of the income scale are left-leaning, as are people at the lowest end. It is in the second tier (the people just below the top 1% to around the 40% mark) who are most likely to be right-leaning. There's a certain level of income where being taxed an extra 4.6% doesn't matter so much. But the people just below that level often find that they have lots of the disadvantages of being "rich" without so many of the advantages.

Yeah, live in an urban area and dont own a gun, although having been on the military deployed in the middle east, I understand the difference between automatic and semi-automatic. My intended point was to make fun of the apocalyptic speech on both side of the political spectrum that is so common these days.

4.6 percent does make a difference in my economy, but having risen from being a legal immigrant living out of his savings until authorized to work, and never getting any government help even If i was entitled to it, to getting a career and being successful, I can relate to the poor and how that a fraction of that extra 4.6% could benefit someone like me who just needs a chance, or someone who has been victim of these horrible times.

I think no matter what we think, what we do or who we elect, the world will not end, the United States will not become a Communist dictatorial regime and our country will continue to be the place where someone like me can have a second chance.

 

[KPOM]

And extra cash gives you to access education, which makes it more likely that you can find avenues for capital and the know how to take advantage of opportunities that present themselves.

Plus... you are only taxed at a higher rate for money earned over 400k.

Not quite. The phaseout of deductions begins at $200,000. Plus the payroll tax increase hits everyone.

 

[Eraserhead]

Note that obesity was never really an issue until the government started promoting a high carb, low fat diet with "substitutes" like hydrogenated oils. They've finally gotten wise to trans fats, but still promote garbage like whole grains (loaded with gluten).

Out of the people with enough to eat who didn't have to undertake manual labour obesity has always been an issue. Look at the Kings of England.

Read up on the Great Northern Railroad. Unlike the Union Pacific and Central Pacific, it was a transcontinental railroad built almost entirely without public subsidies of any kind,

Great, I see that private money has paid for some railways, on top of those mentioned in my original post. I see that the Indian railways were also originally privately owned, before becoming run by the state in 1900.

But at the end of the day for every great private railway project I'm sure you can name 10 state run ones - and usually the state run ones come first - that the third line across the US wasn't subsidised isn't actually as impressive as truly private money funding the first line.

and was so successful that the "progressive" Theodore Roosevelt administration broke it up with bogus anti-trust legislation.

Are you just using progressive as an insult here? And I call ******** on your claim - there is no mention of this in its Wikipedia article at all.

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We don't need fewer loopholes...we need NO loopholes. Knock out every single credit and deduction

This isn't realpolitik. You'll achieve far more success merely aiming to reduce the number of loopholes.

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OK, so tell me how well central planning worked in the USSR, or China, or anywhere else it was tried?

So the interstate highway system is a failure .

 

[quagmire]

Also should note the only reason we have public rails today is due to Nixon taking over the industry and creating Amtrak. The free market was well on its way of killing public railroads due to the airlines.

Without Amtrak, it would be much more difficult going between DC and NYC and getting my car between MD and FL.

 

[wgnoyes]

Apple Paid $6 Billion in Federal Income Tax in 2012, 1/40 of All U.S. Corporate Income Tax Collected

No...WE paid $6 billion in Apple's name in federal income tax. Apple simply collected it for us and passed it along. Corporations don't pay income tax; their customers pay it for them!

 

[skunk]

No...WE paid $6 billion in Apple's name in federal income tax. Apple simply collected it for us and passed it along. Corporations don't pay income tax; their customers pay it for them!

So I suppose we should patronise only those companies which pay no tax, make a loss or get rebates, then. Makes sense.

 

[WestonHarvey1]

Regardless how you slice it I noticed my paycheck reduced by more than $50 bucks every two weeks, so it is the same thing....

The fact Obama made a 3 minute speech about how he has saved us from higher taxes but failed to say "oh yea social security is going back up to 6.2%was completely irresponsible.

The "not going up, just expiring" argument is so silly. Any time someone uses it, ask "So, they're going down then? No? They're staying the same? No? What other mathematical possibilities are left?"

 

[skunk]

The "not going up, just expiring" argument is so silly. Any time someone uses it, ask "So, they're going down then? No? They're staying the same? No? What other mathematical possibilities are left?"

The word you may be looking for is "reverting".

 

[JoeG4]

Also should note the only reason we have public rails today is due to Nixon taking over the industry and creating Amtrak. The free market was well on its way of killing public railroads due to the airlines.

Without Amtrak, it would be much more difficult going between DC and NYC and getting my car between MD and FL.

According to the opinion of the noisiest people in this thread, this is a selfish view that you're only going to vote for the person that benefits you most - even if the country goes to ruin. La la la.. yea we can't AFFORD to provide those kinds of services! Sure, public transit is a noble thing to provide, but WE'RE IN HUGE DEBT HERE! WE HAVE TO BE FISCALLY RESPONSIBLE!

I love the "I'm sorry, we simply can't afford to provide x" right wing argument.

 

[samiwas]

No...WE paid $6 billion in Apple's name in federal income tax. Apple simply collected it for us and passed it along. Corporations don't pay income tax; their customers pay it for them!

And when I do a job for a company, they pay me enough to cover my taxes as well. And you are paid enough to cover your taxes. It's simply the way it works.

If I thought that Apple or any other company would lower their prices the amount they currently collect in expected taxes, then I might think that getting rid of corporate tax would do something. But when the FAA tax was eliminated, some airlines actually raised their base prices so that the ticket price remained the same.

So it is your (and several other posters) belief that business should have absolutely zero monetary responsibility to the country at all outside of consumption sales taxes?

 

[Eraserhead]

Sure, public transit is a noble thing to provide,

So how else do you make sure people without cars can get to work so they can contribute to the economy?

And how much would the extra roads cost in major cities so that people who do currently use public transport to get to work could still get around in a reasonable timespan?

The only part of the US budget that you can obviously easily cut is defence - the US obviously isn't going to be attacked by its neighbours.

 

[thekev]

According to the opinion of the noisiest people in this thread, this is a selfish view that you're only going to vote for the person that benefits you most - even if the country goes to ruin. La la la.. yea we can't AFFORD to provide those kinds of services! Sure, public transit is a noble thing to provide, but WE'RE IN HUGE DEBT HERE! WE HAVE TO BE FISCALLY RESPONSIBLE!

I love the "I'm sorry, we simply can't afford to provide x" right wing argument.

Public transportation does serve a purpose beyond nobility. Not everyone can afford to drive. This can include the price of gas, insurance, vehicle maintenance, tax in the form of vehicle registration renewal, and other things. In a major city you can add the cost of parking and potentially higher insurance rates. Areas like DC and NYC are not properly equipped to handle the traffic of everyone driving those roads. In the end do you think it's more expensive to provide mass transit or deal with all of those extra vehicles?

Edit: I think I misinterpreted the tone of your post. Was that last line there before?

 

[skunk]

Edit: I think I misinterpreted the tone of your post. Was that last line there before?

To be fair, the post in question is somewhat ambiguous.

 

[KPOM]

Out of the people with enough to eat who didn't have to undertake manual labour obesity has always been an issue. Look at the Kings of England.

Are you seriously telling me that you trust the USDA and FDA to make good food recommendations? We don't have an exercise problem in this country. We have a diet problem. People eat lots and lots of processed carbohydrates. The poor are the ones most likely to be obese in this country. That's because processed carbohydrates, corn, soy, etc. are subsidized and food products made out of them are cheaper.

Great, I see that private money has paid for some railways, on top of those mentioned in my original post. I see that the Indian railways were also originally privately owned, before becoming run by the state in 1900.

But at the end of the day for every great private railway project I'm sure you can name 10 state run ones - and usually the state run ones come first - that the third line across the US wasn't subsidised isn't actually as impressive as truly private money funding the first line.

Unlike the Central and Union Pacific (which combined as the first, not the first and second), the Great Northern was privately funded, and unlike the state run railway, it didn't trample on the rights of the Native American landholders or use virtual slave labor. That is pretty impressive, in my opinion.

How well have state-run airlines done? Not particularly well. The ones that are relatively successful were privatized long ago (such as British Airways). The best move Jimmy Carter made in his entire presidency was deregulating the airlines. That really enable airlines like Southwest (which actually predates deregulation but had to fight in court for years for the right to fly) to really take off (pun intended).

Are you just using progressive as an insult here? And I call ******** on your claim - there is no mention of this in its Wikipedia article at all.

So the interstate highway system is a failure .

Sorry, I had my presidents mixed up. It was still sued under the Sherman Act.

"Progressive" has become a pejorative because it is almost Orwellian. "Progressives" often seem less concerned about actual progress than bringing things back to some idyllic state that never existed (a state run utopia).

As for the interstate system, it was actually the brainchild of Eisenhower, who envied the Autobahns he saw in Nazi Germany. While obviously there are some benefits to the system, there are some drawbacks as well. Actually, it's often those on the left who lament its effects on urban planning, congestion, and pollution. It was essentially a massive subsidy of the car, and it's a bit ironic that now government wants to undo a lot of what it subsidized in the past.

In any case, I'm not saying there is no role for government. I'm saying that its role is often expanded unnecessarily. Just because government has done something in the past doesn't mean it needs to so do now. I suspect if, say, grocery stores had been run by the government for the last 100 years we'd be having this same conversation about whether the private sector can adequately provide such a vital service as food distribution.

 

[Tiger8]

The easy solution is to eliminate the corporate income tax altogether. Perhaps replace it with a small consumption tax on the ultimate buyer. At the end of the day corporations just collect taxes. People (whether customers, employees, or shareholders) ultimately bear the burden of corporate taxes.

Barring that, then just lower the corporate tax rate to what other countries have, and don't tax overseas income (most countries don't). The current system creates a perverse incentive for multi-national companies to leave their profits overseas, since they would wind up paying the difference between 35% and the foreign rate if they brought the money home. We gave a tax holiday to multinationals in 2004 and companies repatriated billions of dollars.

Unfortunately our tax code is created by politicians supported by or worse who ave their own involvement in big corporations.

The tax code is meant to screw the middle guy (mid-size corporations). The big corps get to use all available loopholes and creative accounting, small biz get a ton of deductions (good publicity for politicians), it is the mid size companies that get screwed.

 

[SactoGuy18]

In the end, this story proves what I've said all along: the income tax code in the USA based on Title 26, the Internal Revenue Code, plus all its subsequent rulings are a terrible idea.

Think about what's wrong with the US tax code:

1. 30,000 tax lobbyists--HALF the lobbyists in Washington, DC--fighting for every scrap of a tax loophole. And you get political corruption on a huge scale over this.
2. The result is a tax code so complex that it makes James Joyce's Ulysses easy to read in comparison. Even the IRS can't figure out much of the tax code!
3. The sheer complexity means exorbitant yearly compliance costs, estimated by some economists to be approaching US$430 BILLION per year (and climbing fast in each subsequent year).
4. It also encourages the outsourcing of millions of jobs, thousands of factories, and hundreds of corporate headquarters for tax avoidance reasons. Care to explain why so many companies incorporate in the states of Nevada and Delware in the USA or use highly complex accounting schemes like the infamous Double Irish with Dutch sandwich scheme used by Google?
5. It results in (by some estimates) around US$15 TRILLION on American-owned liquid assets sitting in offshore financial centers and other foreign banks for tax avoidance reasons (care to explain all those "banks" in the Cayman Islands, Bahamas, British Virgin Islands, and so on?).
6. Government uses the tax code as a political instrument to favor or punish political constituencies as little as ONE taxpaying entity.
7. Because the IRS needs to know intimate details of personal and business financial records in tax return filings, there are potentially serious issues with invasion of privacy.
8. The IRS assumes you're guilty of tax evasion, and you end up having less rights than most common criminals!

In short, utter economic and political insanity. We need to seriously look at unprecedented income tax reforms such as the no-loophole flat tax originally proposed by Steve Forbes in 1996 or the FairTax replacement for the entire income tax code (H.R. 25--yes, it's a real bill in Congress). Such unprecedented reforms would end most, if not all, the issues I mentioned above, tremendously boost economic activity (because the tax code is no longer an impediment to economic growth), and also means with higher economic growth we have WAY more revenue to the government in the first place.

 

[tbrinkma]

I dreamt of a world where everyone made enough money to live comfortably and had everything they needed.

And then human nature took over, and no one had anything - except those with the biggest guns.

This is the biggest lie/folly of the modern democratic party. That those who make more should pay more (i.e. bring their net worth/income closer to the median) so those who either don't make much money/can't/won't work can pay less and see their net worth/income rise to the median.

I hate to break it to you.....but socialism has been tried and always leads to the same outcome - the top earners realize they could make just as much without working, ambition is sucked out of society, and a dictator moves in to take the country's riches - it's called communism.

Obviously this wouldn't happen tomorrow - but its a slippery slope. Today we're "Making the rich pay just a little bit more so the poor have a fair shot" (as if the person making this statement has any business saying what is fair). Next we see "Well we (the govt) still needs more money so those rich people need to pay a little more - they still make more than most"....

I think you see where I'm taking this.

In an ideal world, communism would be a GREAT economic system. You get what you need, you provide what you're capable of providing. Unfortunately, it kind of falls apart HARD when you factor in the sociopathic portion of humanity.

Picture Star Trek's Federation of Planets. That's ideal communism. In reality you'd get something where the Ferengi were in charge, and paid the Klingons to help the pesky masses in line.

 

[PaulChowHK]

USA problem easy people and companies giving too little and wanting too many something for nothing and government spending like no tomorrow. Good thing they having GLFC credit card.

 

[tbrinkma]

Didn't say they didn't pay ANY taxes - specifically talking about income taxes.

And since I only began working last year in October, my wife and I fell into the lower part of that 50%.....and guess what - we received all our federal income tax money back in our return effectively paying $0 in income tax.

Not really. You got back what you paid, but you didn't get back the interest on that short term loan you gave to the federal government. They got to keep that.

 

[tbrinkma]

How many are "many"? A large portion of that 40% should pay income taxes.

EVERYONE should pay income taxes. If you make a dollar, you should owe the government $0.17. Period. Everyone contributes.

I'm against a teared tax system, I like a flat or fair tax, but i'm willing to accept a teared system as a step in the right direction so long as no one gets off paying nothing.

On a personal level, I'd LOVE my tax rate to be reduced to 17%. On a level where I look at more than just my own, selfish self-interest, and look toward the well being of my fellow people, I recognize that would be an absolute DISASTER. Taking 17% of the income of the folks who currently make too little to pay a net income tax would put a large portion of them out on the street. As a result, I'm willing to pick up part of their share.

 

[marksman]

A good idea except corporations are given the rights of an individual. They should therefore pay taxes as such.

Besides the ridiculousness of our courts giving corporations rights of individuals, the problem is any business is a middleman in a tax equation. The final destination for the money should be the target of profit and income based taxes not intermediate steps. This might encourage companies to reinvest but ultimately profits will end up in the hands of shareholders and owners and taxed. One caveat if you strip away this corporate taxation you really need to get rid of the capital gains taxes and treat capital gains as regular income. Some would argue this would hamper investment but I think it would be offset but corporate reinvestment.

Another problem here are the states. States have some crazy taxation policies for corporations in some cases so cleaning up at the federal level is not all that needs to be done.

One of the reasons the capital gains benefit exists is because it is essentially double taxation on the same earned money. Tax all income as income at the destination and be done with it. This means owner profits and shareholder gains are taxed not corporate earnings.

 

[tbrinkma]

...and obammy still puts his hands in my pocket and takes another 2k a year from my earnings.

You DO realize that Congress, not the President, is responsible for levying taxes.