Tax Avoidance: Moral or Not?

[vorlon13]

Is it 'moral' to have me at such an extreme level of compliance while wage earners and investors get some slack ?

[Catholic_Lady]

An example of a failed UK tax avoidance scheme (not a great site, but it explains the mechanics of the scheme well enough):

https://www.google.co.uk/amp/s/amp.ibtim...rc-1448258

That's a scheme. I consider that as bad as any other "scheme" to avoid taxes.

Let me make it clear that looking for deductibles so you don't have to pay as much tax is one thing. Schemes such as the one presented here, is another entirely. I'm ok with the former, not the latter.

[Tiberius]

Is it 'moral' to have me at such an extreme level of compliance while wage earners and investors get some slack ?

I think property tax is a weird thing; it really should only apply if you aren't actively using the property, because at least that way people can't just buy up huge amounts of land and just leave them sitting there idly.

I don't see why people should have to pay taxes on their houses when they are living in them, or farms when they are using them to support a business. If anything, farm property tax should be an expense you can write off on your business taxes.

[ukatheist]

That's a scheme. I consider that as bad as any other "scheme" to avoid taxes.

Let me make it clear that looking for deductibles so you don't have to pay as much tax is one thing. Schemes such as the one presented here, is another entirely. I'm ok with the former, not the latter.

Yeah, I'd classify using the usual deductibles to reduce tax liability as tax planning, not avoidance. The law permits particular categorisations of expenses to be deducted from income, and that is the intention of that law.

[vorlon13]

I can take a deduction on my federal tax return for property taxes.

But typically the property tax bill is 3X the federal tax. If I paid no federal tax at all (a possibility in a very dry year, btw, and I'd still owe the property tax regardless) I'm still paying, with no way to get a deductible or finagle a loophole*, 3X more than that in property taxes.

And the income that property generates (by dint of my labor) is taxed too, and when I croak, a big chunk of that property might have to be sold to pay the inheritance taxes.

* there is a factor in the property tax calculations that allows for the quality and suitability of my land for farming. If I had bad land, I'd pay less. As it turns out, I have good fertile land, so that factor also runs up the tab

[Tiberius]

Is your property worth more than $5 million, because if not, I'm pretty sure inheritance taxes don't apply. $10 million if you leave it to a married couple.

Inheritance taxes in the US are pretty good IMO; in the UK I think they apply to anything above $500,000

[Catholic_Lady]

Let me make it clear that looking for deductibles so you don't have to pay as much tax is one thing. Schemes such as the one presented here, is another entirely. I'm ok with the former, not the latter.

Yeah, I'd classify using the usual deductibles to reduce tax liability as tax planning, not avoidance. The law permits particular categorisations of expenses to be deducted from income, and that is the intention of that law.

Gotcha. I should have read the OP more carefully.

[vorlon13]

Is your property worth more than $5 million, because if not, I'm pretty sure inheritance taxes don't apply. $10 million if you leave it to a married couple.

Inheritance taxes in the US are pretty good IMO; in the UK I think they apply to anything above $500,000

At this very moment they are trying to change the threshold downwards.

[The Grand Nudger]

Ever thought of getting out?

[ukatheist]

Ignore me, being dense.