Quote :

"Astros fan learns there’s no such thing as 315 free donuts blah blah blah... getting issued a 1099 form and taking a $237 tax hit after winning over 300 coupons for free donuts and coffee on fan appreciation day at a Houston Astros game? http://sports.yahoo.com/mlb/blog/big_league_stew/post/Astros-fan-learns-there-8217-s-no-such-thing-as?urn=mlb-wp3695"

I think this is absurd. I don't know why anybody who has power to do anything doesn't do anything.

Giving away free shit should be free.

At very worst the customer should pay the tax at the counter, per coupon he uses. So if he only uses 8 coupons.. he should only pay tax on the 8 things he buys.

This law prevents giving poor people houses, simply because the tax is unaffordable.

It just seems completely irrational and irritating to me that this exists.

4/18/2011 8:51:02 PM

Related: why is there a gift tax? If I give you a million bucks, just for the sake of it, why should the government get a cut of that? Yet another reason to eliminate our invasive tax laws and institute a consumption tax.

4/18/2011 8:52:24 PM

gift taxes are straight retarded.

4/18/2011 8:53:57 PM

the whole article:

Quote :

"Everyone knows you're going to get hit with a hefty tax bill when you go on "The Price Is Right" and win a Corvette, a living room set and a trip to Aruba. Same goes for the cash you take home after playing hangman with Pat Sajak and Vanna White on "Wheel of Fortune." But getting issued a 1099 form and taking a $237 tax hit after winning over 300 coupons for free donuts and coffee on fan appreciation day at a Houston Astros game? Well, that's about as unpleasant of a surprise as tasting a chocolate creme filling when you were expecting Bavarian: Yet that — and presumably thousands of empty hidden calories — were the hidden costs for Bob Choate. As the Houston Chronicle reports, the Astros fan thought he had hit a jelly-filled jackpot when he won 315 coupons for a free coffee and doughnut at Shipley Do-Nuts last season. But the prize was estimated by the team and chain to be worth $927.61 — or about $3 a coupon. And that led to them requiring a 1099 tax form to be issued because it was above the $600 threshold. Choate thought the doughnuts and coffee were not worth that much. In fact, he only used eight coupons because — let's face it — there's no way anyone could ever cash in 315 coupons and live to tell about it. He brought this up with both the team and doughnut chain and after getting no relief from the Astros, doughnut baron Lawrence Shipley agreed to cover the tax on his goods. From the Houston Chronicle: Choate said he's made the exchange with the Astros and Shipley a lesson for his kids. "I told them that if you think something isn't the way it should be, speak up and be professional and reasonable and diplomatic," he said. "And, if you're on the other side of the table, you should listen." But before you start thinking that Choate is a chronic complainer who's only looking for a free ride — or 26 free dozen doughnuts — know this: He was so impressed by the doughnut chain's gesture that he says he's going to donate $237 to Shipley's favorite charity. I'll dunk a cruller to that. Mmmmm, donut."

4/18/2011 8:54:32 PM

thats what he gets for being a fucking astros fan


doesnt dubya own part of the astros? clearly his fault

4/18/2011 8:55:24 PM

something has to pay for all this govt sponsored healthcare

4/18/2011 8:55:56 PM

I understand corporations and individuals use(D) gifts as a tax evasion maneuver but seriously, there's gotta be a better way to sort between corruption from legitimate without punishing everyone just because the government lacks the power of common sense.

4/18/2011 8:56:12 PM

Quote :

"doesnt dubya own part of the astros? clearly his fault"

i think it's the rangers

4/18/2011 9:01:16 PM

It's not punishing people. Gifts come in all sizes, large and small, and the giver is not taxed. Thus, the receiver must be. If they didn't have this type of tax, then people could easily get around tax laws by simply "giving" items to someone, and later on, in an unrelated transaction, have that person "give" them money.

The receiver of the conferred benefit must pay taxes on the value of that benefit received. The only issue here is that it seems like such a small item that this guy has been gifted, so it shouldn't be taxed, and that is why there is a $600 threshold. If I give you a teddy bear, it's not taxed. If I give you ten thousand teddy bears, they are. The same applies here. Just because this guy only wanted to use 8 of the coupons doesn't mean the value is not there.

I know a guy who won a violin in a game show one time. He didn't play the fucking violin, so he had to sell it just to pay the tax bill. Point is, the government can't go around figuring out what has value to YOU, it's about the objective market valuation.

4/18/2011 9:06:53 PM

so let's say i work and save up $100k and pay my income taxes on it

then i give my buddy $100k as a gift

why should he have to pay taxes on that?

4/18/2011 9:21:22 PM

http://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax/INF12036.html

[Edited on April 18, 2011 at 9:31 PM. Reason : G]

4/18/2011 9:28:27 PM

Consumption tax, baby. Otherwise, me and you can trade the same stack of bills back and forth all day, and at the end of the day, 99% of it belongs to the government, according to the law. Does that sound right?

4/18/2011 9:30:40 PM

I don't know about you all, but I pay taxes on birthday and Christmas gifts every year.

4/18/2011 9:32:02 PM

you must be giving amazing gifts

can i get on your list

4/18/2011 9:32:53 PM

I'm talking about the gifts I receive. But sure, I'll hook you up.

4/18/2011 9:33:43 PM

hey not to get faggy in chit chat but,

a CPA friend said consumption taxes fuck the poor. in what way? (he didnt explain the statement)

4/18/2011 9:38:42 PM

Because there's no real way to "not tax" someone below the poverty level. They already pay almost nothing, then theyll have to pay 20% more. I'm not against a consumption tax, but there's flaws that aren't cleanly worked out

4/18/2011 9:45:46 PM

There appears to be a huge amount of misunderstanding about gifts vs winnings up in this thread.

4/18/2011 9:56:58 PM

Quote :

"Related: why is there a gift tax? If I give you a million bucks, just for the sake of it, why should the government get a cut of that? Yet another reason to eliminate our invasive tax laws and institute a consumption tax."

Then everyone could simply give "gifts" in return for services.

4/18/2011 10:09:22 PM

sounds like the obvious thing would have been to limit the coupon winnings to a $600 value to keep below the threshold

4/18/2011 10:16:06 PM

consumption tax ftmfw

those below poverty line should get a refund based on income and consumption tax rate. say they ear $20k/year and consumption tax is 10%, then they get a 2k check. what's wrong with that.

4/18/2011 10:26:43 PM

flat tax, sure

consumption tax (as much as I love the idea from a savings perspective)--fuck no, from the perspective of what it means for the poor.

4/18/2011 10:31:44 PM

^^they will starve to death before they get the check.

4/18/2011 10:35:40 PM

^who said they have to wait so long? monthly? bi-monthly? etc? there are options. and no, they wouldn't starve to death anyways.

4/18/2011 10:36:42 PM

^ I'm not totally sold on the FairTax, but it addresses that concern by making it a "prebate".

^^ All things being equal (i.e., revenue-neutral), I don't see how a consumption tax would be any worse for the poor than a flat tax, although either can be engineered pretty easily to not tax the poor.

4/18/2011 10:40:21 PM

Ok, assuming you take care of the poor, How can they be engineered to not shift the incredible bulk of the tax burden on to the middle class?

4/18/2011 10:47:26 PM

You can't. People forget that most of the rich's assets are in non physical objects, removing capital gains taxes removes more revenue...

[Edited on April 18, 2011 at 10:51 PM. Reason : .]

4/18/2011 10:51:06 PM

because it's consumption based? rich people spend more money, that's a given, thus they'll pay the most in taxes. and there obviously have to be limits on the maximum rate. I say 10%. I'd have the states set their individual rate (<=10%) and the feds bill the state for their share. that's right, 10%. shrink the government baby!

4/18/2011 10:52:39 PM

but poor people will pay a higher percentage of their income in taxes

4/18/2011 10:54:19 PM

There is not really a way that could generate nearly enough revenue to operate the government. It would have to be like 25%. At that point you discourage consumption and kill the economy. You can't put in something that tells people "hey, don't go out and buy stuff"

This entire idea was generated by the uber rich as way out of paying the bulk of the taxes.

4/18/2011 10:56:04 PM

Quote :

"There is not really a way that could generate nearly enough revenue to operate the government."

wonderful. shrink the government to fit the budget. a marvelous idea!

4/18/2011 10:57:05 PM

ITS THAT EASY!!!

4/18/2011 10:57:38 PM

what does the fed bring in each year? ~$2 trillion? how much do american's spend each year? ~$14 trillion? 10% of that...1.4 trillion?

4/18/2011 11:08:08 PM

Quote :

"Ok, assuming you take care of the poor, How can they be engineered to not shift the incredible bulk of the tax burden on to the middle class?"

Quote :

"You can't. People forget that most of the rich's assets are in non physical objects, removing capital gains taxes removes more revenue..."

No, a major problem right now is that the rich (I don't mean this upper-middle class, $250k/year crowd that leftists call "rich"...I mean fucking RICH) don't pay a lot in income tax, because so much of their income is derived from dividends, long-term capital gains, stock options, etc. A consumption tax (national sales tax, VAT, etc) would address that.

Quote :

"but poor people will pay a higher percentage of their income in taxes "

You could run a credit to everyone based on a certain level of subsistence, and the poor would pay zero taxes just like they do now.

Quote :

"There is not really a way that could generate nearly enough revenue to operate the government. It would have to be like 25%."

True, but what we're doing now doesn't generate nearly enough revenue to operate the government, either...haha.

...and raising income taxes enough to cover it would crush the economy, too. There is no way to tax our way out of this one. Spending is going to have to be slashed. Economic recovery will help some, but I don't think there's a plausible scenario where our current spending is sustainable.

4/18/2011 11:09:54 PM

Quote :

"You could run a credit to everyone based on a certain level of subsistence, and the poor would pay zero taxes just like they do now. "

that sounds pretty reasonable

4/18/2011 11:15:53 PM

that's essentially what I said earlier dammit

4/18/2011 11:16:33 PM

them 190% jalapeno kolaches

4/18/2011 11:16:46 PM

1000 DOLLAR PENCILS

5000 DOLLAR TOILET SEATS

4/18/2011 11:18:23 PM

On the point that a consumption tax hurts the poor, that's why I specifically mentioned a value added tax, or something like that. On lower cost per unit items (groceries, fuel, you know - things that the poor spend most of their money on), you get, say, a 5% tax. On high cost per unit items, (homes, vehicles), you get perhaps a 10% sales tax, and on things that really only the super rich can afford, some higher tax. The actual percentage amounts there are hypothetical, but you should be able to see how a consumption tax can be modified in such a way that it isn't regressive in its outcome.

In any case, this system would have many benefits. For one, it's not invasive - the current income/gift/estate/reward/etc taxes basically require the honor system on a massive scale (clearly this model was not designed for humans?), it's an invasion of privacy, it requires a gigantic arsenal of tax-related government workers to enforce which is a drain on the budget in itself, and there is a huge portion of the private sector devoted to working with/around taxes that could otherwise be participating in productive endeavors.

[Edited on April 18, 2011 at 11:43 PM. Reason : ]

4/18/2011 11:37:51 PM

DOLLAR BUCKS

4/18/2011 11:41:58 PM

i think that's a dangerous way to engineer the tax not to be regressive. Jumping through all sorts of overly complicated, easily manipulated hoops to make a consumption tax progressive kind of defeats the purpose. At most, I'd say to exempt certain staples (easy to do with a sales tax...not so easy with a VAT, though). The more reasonable approach, I think--particularly with a VAT--is to just go with a credit equivalent to the value of necessary staples.

4/18/2011 11:43:27 PM

Do you trust your wife? What I mean is, do you think she'd go behind your back? Try to hamstring you?

If you want to keep that money, all of it, just give it to your wife. See, the IRS allows you a one-time-only gift to your spouse. It's good up to sixty thousand dollars.

Tax free. IRS can't touch one cent.

It's perfectly legal. Go ask the IRS, they'll say the same thing. Actually, I feel silly telling you all this. I'm sure you would have investigated the matter yourself.

4/18/2011 11:48:38 PM

I still think what I described would be better than what we've got now, and probably an easily sell to progressives. I like the idea of exempting certain kinds of items and sticking with a flat tax - picking the credit "threshold" sounds a little iffy, and I'm not sure exactly how it'd be enforced.

4/18/2011 11:49:26 PM

Quote :

"There is not really a way that could generate nearly enough revenue to operate the government. It would have to be like 25%. At that point you discourage consumption and kill the economy. You can't put in something that tells people "hey, don't go out and buy stuff""

And yet, that's exactly what happens right now! The tax-percentage of everything you buy is about 25%. It's just hidden. what, exactly, is the fucking difference?

4/19/2011 12:19:17 AM

If you start with a paycheck, 37% is taken out immediately for taxes.

Then when you buy food at a restaurant, or see a movie, or whatever, there is tax on the same money.


The tax burden is way higher than 25% per buck.

4/19/2011 12:22:58 AM

Along with giving everyone a stipend, include socialized medicine, food, higher education and transportation. Everything else must be bought and taxed. Basically everyone gets what they need free and buys extra shit at really high tax rates. O wait, this is starting to look like a planned economy.

4/19/2011 1:27:48 AM

^ I never said anything like that...

^^ Probably if you count SS and Medicare taxes...that's kind of a separate argument, unfortunately. Actual income tax witholding, on average, is nowhere near 37%.

Quote :

"picking the credit "threshold" sounds a little iffy, and I'm not sure exactly how it'd be enforced."

What's there to enforce? Everyone would just get a check for a flat amount.

4/19/2011 5:26:30 PM

Yeah, the government likes to get their cut out of each. and. every. time. money. changes. hands.

If the govt. was even approaching fiscal responsibility they'd have more than enough to do what they need to do with all that money they skim off every transaction.

4/19/2011 6:01:17 PM

UNFAIR EGGS

4/19/2011 6:03:04 PM

UNFAIR TAXEGGTION

4/19/2011 6:03:27 PM