How the Wealthy Save Billions in Taxes by Skirting a Century-Old Law

[Scott]

 

At first glance, July 24, 2015, seems to have been a brutal trading day for Steve Ballmer, the former Microsoft CEO. He dumped hundreds of stocks, losing at least $28 million.

 

But this was no panicked sell-off. Among the stocks Ballmer sold were those of the Australian mining company BHP and the global oil giant Shell. Had Ballmer lost confidence in BHP’s management?

 

https://www.propublica.org/article/irs-files-taxes-wash-sales-goldman-sachs

 

[Chomper Higgot]

Yep, that’s an example of how the rich avoid taxes.

And an example of a loophole that is easy to plug without any impact on the vast majority of working people.

[findlay13]

The rich make the "laws" that allow them to avoid taxes, meanwhile telling the rest of us to "obey the law"

[RuamRudy]

One centuries old law? I have no doubt that there will be many laws in place that are designed solely for the benefit of the privileged elite who wrote them or sponsored those who wrote them.

 

In the UK we have a prime minister who's billionaire wife, despite living here, was allowed to pretend she didn't so she didn't have to pay her fair share of tax. 

 

We have a king who doesn't have to pay the same inheritance tax as the majority because... well, because other rich people decided he didn't need to pay his fair share.

 

Governments the world over are corrupt and work to shore up their own positions. Nothing will ever change.

[Chomper Higgot]

34 minutes ago, RuamRudy said:

One centuries old law? I have no doubt that there will be many laws in place that are designed solely for the benefit of the privileged elite who wrote them or sponsored those who wrote them.

 

In the UK we have a prime minister who's billionaire wife, despite living here, was allowed to pretend she didn't so she didn't have to pay her fair share of tax. 

 

We have a king who doesn't have to pay the same inheritance tax as the majority because... well, because other rich people decided he didn't need to pay his fair share.

 

Governments the world over are corrupt and work to shore up their own positions. Nothing will ever change.

Things will not change while ever voters subscribe to the fatalism of all Governments being corrupt.

It’s a fatalism that is plays right into the hands of the very people who are actually corrupt.

[bigupandchill]

You do nor make the poor rich by making the rich poor.

[riclag]

1 hour ago, findlay13 said:

The rich make the "laws" that allow them to avoid taxes, meanwhile telling the rest of us to "obey the law"

Theres much to be said about that!

Politicians and people who have accumulated wealth and power!

 

When I was a rebelliously young lad working in the steel mills I had a boss years and years ago who use to  put his arm around my shoulder like a dad look me straight in the eye and say , “ play the game Ricky,just play the game” and when that didn’t sink in ,the suit with wingtips (owner)came down into the factory and said , if you don’t like what your doing here , find another way of making a living.

So eventually I did  play the game and left  ! Months of taking my children's piggy bank  savings and always returning it to make ends meet , and eventually with hardwork and with the help of a partner, rich people ,lawyers ,accountants , bankers , stockbrokers, consultants and employees.I experience the American dream while paying as little as we could “legally” in taxes.

I love capitalism , billionaires, millionaires and people who know the value of making money through hardwork, risk and a little bit of luck !

[placeholder]

33 minutes ago, bigupandchill said:

You do nor make the poor rich by making the rich poor.

Making money by mining minerals is one thing. Making it by mining the tax code is something else entirely.

[RuamRudy]

1 hour ago, Chomper Higgot said:

Things will not change while ever voters subscribe to the fatalism of all Governments being corrupt.

It’s a fatalism that is plays right into the hands of the very people who are actually corrupt.

I fully agree with you, but the fix won't be pretty. The people with all the power are not going to sit on their hands while the proles get uppity. There is, at least to me, no obvious route to a peaceful change.

[Longwood50]

5 hours ago, Chomper Higgot said:

Yep, that’s an example of how the rich avoid taxes.

And an example of a loophole that is easy to plug without any impact on the vast majority of working people.

The fact is that unless someone is lying on their tax return, they all are using not "tax loopholes" but rather the legitimate regulations to lower their taxes.  A tax loophole could be applied to a 401(k) because it reduces the tax owed by someone saving for retirement.  It could be a mortgage interest deduction that is not enjoyed by someone who rents versus owns their home.  It could be someone from a high tax state like California, or New York being able to deduct their state income taxes but the person with the identical income living in Florida or Texas pays no income tax so in effect they pay more to subsidize the deduction given to the person living in California and New York. 

Now with Balmer it is highly unusual to have two virtually identical securities.  He sold the security and took the loss.  That loss only can be used to offset a gain.  He really only delayed not avoided the tax.  The loss meant he paid more for the stock he sold than it was worth.  The stock he replaced it with was with a lower cost basis.  So assuming the stock rises in value, he will then owe the taxes on the gain.  He avoided nothing.  He only deferred when it would be paid.  This only works if Balmer had sold stock that had "gains" So what he did by selling the stock he was able to write off his losses but only to the extent that he had gains in other securities that he make a profit on.  So he paid his taxes on his gains minus the losses in the securities he sold.  Nothing unfair at all about that.  Would you have him pay taxes on his gains but not write off losses.  

 

This wash is nothing just for the "rich"  Each December millions of investors sell securities that they have a loss in to offset gains.  Again, all that does is change the timing of when future taxes would be paid.  It is called tax loss harvesting and the majority of it occurs in December each year as investors sell their losers to avoid paying the capital gains tax on their winners.  They still pay taxes on their net gain, and net losses are limited to a $3,000 limit against ordinary income.  



Even Biden funneled his book revenue into a Sub Chapter S corporation thereby saving $500,000 in taxes.   In a Sub Chapter S the payroll taxes are based on your "salary" not the income of the corporation.  The earnings of the Sub Chapter S would still flow to his personal tax return and he would pay income taxes on them, however his payroll taxes were reduced by upwards of $500,000 because he only paid those on what he stated was his salary not the earnings of the corp. 

Now is that a loophole?  No, it is a legal method that is part of current U.S. tax law.  Don't like the practice whether that is tax loss of securities or Sub Chapter S treatment.  CHANGE THE LAW  Don't crab about people who use the regulations to lower their taxes. 

 

https://www.washingtonexaminer.com/news/joe-biden-saved-as-much-as-500-000-using-tax-loophole-obama-tried-to-close

 

[Chomper Higgot]

57 minutes ago, Longwood50 said:

The fact is that unless someone is lying on their tax return, they all are using not "tax loopholes" but rather the legitimate regulations to lower their taxes.  A tax loophole could be applied to a 401(k) because it reduces the tax owed by someone saving for retirement.  It could be a mortgage interest deduction that is not enjoyed by someone who rents versus owns their home.  It could be someone from a high tax state like California, or New York being able to deduct their state income taxes but the person with the identical income living in Florida or Texas pays no income tax so in effect they pay more to subsidize the deduction given to the person living in California and New York. 

Now with Balmer it is highly unusual to have two virtually identical securities.  He sold the security and took the loss.  That loss only can be used to offset a gain.  He really only delayed not avoided the tax.  The loss meant he paid more for the stock he sold than it was worth.  The stock he replaced it with was with a lower cost basis.  So assuming the stock rises in value, he will then owe the taxes on the gain.  He avoided nothing.  He only deferred when it would be paid.  This only works if Balmer had sold stock that had "gains" So what he did by selling the stock he was able to write off his losses but only to the extent that he had gains in other securities that he make a profit on.  So he paid his taxes on his gains minus the losses in the securities he sold.  Nothing unfair at all about that.  Would you have him pay taxes on his gains but not write off losses.  

 

This wash is nothing just for the "rich"  Each December millions of investors sell securities that they have a loss in to offset gains.  Again, all that does is change the timing of when future taxes would be paid.  It is called tax loss harvesting and the majority of it occurs in December each year as investors sell their losers to avoid paying the capital gains tax on their winners.  They still pay taxes on their net gain, and net losses are limited to a $3,000 limit against ordinary income.  



Even Biden funneled his book revenue into a Sub Chapter S corporation thereby saving $500,000 in taxes.   In a Sub Chapter S the payroll taxes are based on your "salary" not the income of the corporation.  The earnings of the Sub Chapter S would still flow to his personal tax return and he would pay income taxes on them, however his payroll taxes were reduced by upwards of $500,000 because he only paid those on what he stated was his salary not the earnings of the corp. 

Now is that a loophole?  No, it is a legal method that is part of current U.S. tax law.  Don't like the practice whether that is tax loss of securities or Sub Chapter S treatment.  CHANGE THE LAW  Don't crab about people who use the regulations to lower their taxes. 

 

https://www.washingtonexaminer.com/news/joe-biden-saved-as-much-as-500-000-using-tax-loophole-obama-tried-to-close

 

Hey look at you defending the billionaires.

 

 

[ozimoron]

Minimum turnover tax on all companies and minimum income tax on all salary earners above a threshold is the only way. If they lose money it's their own fault. Tax should be a business expense like everything else they have to pay.

[gamb00ler]

1 hour ago, Longwood50 said:

It could be someone from a high tax state like California, or New York being able to deduct their state income taxes but the person with the identical income living in Florida or Texas pays no income tax so in effect they pay more to subsidize the deduction given to the person living in California and New York. 

You should re-think this a little.  TX gets back 83c for each federal tax dollar, Fl gets 77c and California gets 65c.  Does that sound like TX and FL are subsidizing CA?

[Hanaguma]

8 hours ago, Chomper Higgot said:

Hey look at you defending the billionaires.

 

 

Billionaires employ thousands, if not millions of people.  They are worth defending.   

 

France tried overtaxing rich people in the mid 2000s with a wealth tax. It increased overall tax revenue by perhaps 1% on that tax, but resulted in thousands fleeing the country and a net loss of twice as much overall. 

 

https://www.bnnbloomberg.ca/france-tried-soaking-the-rich-it-didn-t-go-well-1.1347875

[placeholder]

10 hours ago, Longwood50 said:

The fact is that unless someone is lying on their tax return, they all are using not "tax loopholes" but rather the legitimate regulations to lower their taxes.  A tax loophole could be applied to a 401(k) because it reduces the tax owed by someone saving for retirement.  It could be a mortgage interest deduction that is not enjoyed by someone who rents versus owns their home.  It could be someone from a high tax state like California, or New York being able to deduct their state income taxes but the person with the identical income living in Florida or Texas pays no income tax so in effect they pay more to subsidize the deduction given to the person living in California and New York. 

Now with Balmer it is highly unusual to have two virtually identical securities.  He sold the security and took the loss.  That loss only can be used to offset a gain.  He really only delayed not avoided the tax.  The loss meant he paid more for the stock he sold than it was worth.  The stock he replaced it with was with a lower cost basis.  So assuming the stock rises in value, he will then owe the taxes on the gain.  He avoided nothing.  He only deferred when it would be paid.  This only works if Balmer had sold stock that had "gains" So what he did by selling the stock he was able to write off his losses but only to the extent that he had gains in other securities that he make a profit on.  So he paid his taxes on his gains minus the losses in the securities he sold.  Nothing unfair at all about that.  Would you have him pay taxes on his gains but not write off losses.  

 

This wash is nothing just for the "rich"  Each December millions of investors sell securities that they have a loss in to offset gains.  Again, all that does is change the timing of when future taxes would be paid.  It is called tax loss harvesting and the majority of it occurs in December each year as investors sell their losers to avoid paying the capital gains tax on their winners.  They still pay taxes on their net gain, and net losses are limited to a $3,000 limit against ordinary income.  



Even Biden funneled his book revenue into a Sub Chapter S corporation thereby saving $500,000 in taxes.   In a Sub Chapter S the payroll taxes are based on your "salary" not the income of the corporation.  The earnings of the Sub Chapter S would still flow to his personal tax return and he would pay income taxes on them, however his payroll taxes were reduced by upwards of $500,000 because he only paid those on what he stated was his salary not the earnings of the corp. 

Now is that a loophole?  No, it is a legal method that is part of current U.S. tax law.  Don't like the practice whether that is tax loss of securities or Sub Chapter S treatment.  CHANGE THE LAW  Don't crab about people who use the regulations to lower their taxes. 

 

https://www.washingtonexaminer.com/news/joe-biden-saved-as-much-as-500-000-using-tax-loophole-obama-tried-to-close

 

. As the article specifically says, Ballmer generated tax losses on the sale. And god knows what point you think you are making by the losses can only be used to offset a gain. That's what artificial losses like these are for. To offset gains elsewhere. Your notion that this only delays payment of tax is false.

[placeholder]

41 minutes ago, Hanaguma said:

Billionaires employ thousands, if not millions of people.  They are worth defending.   

 

France tried overtaxing rich people in the mid 2000s with a wealth tax. It increased overall tax revenue by perhaps 1% on that tax, but resulted in thousands fleeing the country and a net loss of twice as much overall. 

 

https://www.bnnbloomberg.ca/france-tried-soaking-the-rich-it-didn-t-go-well-1.1347875

All billionaires? Hedge fund billionaires? Heirs to billionaires? And even if it were true, so what? If we were to accept the logic of your argument, why tax billionaires at all. After all, the more profit they make, the  more profit they have to invest. The more they invest, the better for the economy. But why stop with billionaires? Why not millionaires as well? 

The case you make is extremely simplistic.  For one, there's plenty of historical evidence to show that the wealthy can be taxed at a much higher rate than they are now. In the United States tax rates on the wealthy were much higher in the 50's and 60's and growth was faster.

As for France..

France’s Rich Get Much Richer After Abolition Of Wealth Tax

A new report highlights the impact of a controversial government policy to reduce taxes on the wealthiest people in French society. It concludes that instead of economic growth, as envisaged, the very wealthy have just got richer.

Le Monde called it a “highly flammable report” particularly at a time when “more and more households are being pushed into poverty.”

https://www.forbes.com/sites/alexledsom/2020/10/09/frances-rich-get-much-richer-after-abolition-of-wealth-tax/?sh=41febb4d1fb5

The thing is, there is only so much investment that an economy is capable of absorbing. And we know that the wealthy and corporations are taking too big a share because of the kind of investments they now make. For example, until recently, governments were offering bonds that paid negative interest. Even so,  they were oversubscribed. In other words, the wealthy were actually paying governments to hold on to their money. Clearly, that shows that there is lots of money out there with no place to go. Also, corporations are spending billions on stock buybacks instead of investing in their own growth. It just so happens  lots of bonuses for corporate officers are tied to gains in stock prices.  In the USA, until the Reagan administration came along, that was illegal. It was judged to be stock price manipulation. Which it obviously is.

[Hanaguma]

6 minutes ago, placeholder said:

All billionaires? Hedge fund billionaires? Heirs to billionaires? And even if it were true, so what? If we were to accept the logic of your argument, why tax billionaires at all. After all, the more profit they make, the  more profit they have to invest. The more they invest, the better for the economy. But why stop with billionaires? Why not millionaires as well? 

The case you make is extremely simplistic.  For one, there's plenty of historical evidence to show that the wealthy can be taxed at a much higher rate than they are now. In the United States tax rates on the wealthy were much higher in the 50's and 60's and growth was faster.

As for France..

France’s Rich Get Much Richer After Abolition Of Wealth Tax

A new report highlights the impact of a controversial government policy to reduce taxes on the wealthiest people in French society. It concludes that instead of economic growth, as envisaged, the very wealthy have just got richer.

Le Monde called it a “highly flammable report” particularly at a time when “more and more households are being pushed into poverty.”

https://www.forbes.com/sites/alexledsom/2020/10/09/frances-rich-get-much-richer-after-abolition-of-wealth-tax/?sh=41febb4d1fb5

The thing is, there is only so much investment that an economy is capable of absorbing. And we know that the wealthy and corporations are taking too big a share because of the kind of investments they now make. For example, until recently, governments were offering bonds that paid negative interest. Even so,  they were oversubscribed. In other words, the wealthy were actually paying governments to hold on to their money. Clearly, that shows that there is lots of money out there with no place to go. Also, corporations are spending billions on stock buybacks instead of investing in their own growth. It just so happens  lots of bonuses for corporate officers are tied to gains in stock prices.  In the USA, until the Reagan administration came along, that was illegal. It was judged to be stock price manipulation. Which it obviously is.

According to this source, a majority of billionaires made their money themselves, they did not inherit it.

 

https://www.statista.com/statistics/621426/sources-of-wealth-of-global-billionaires/

 

For "simple" millionaires the ratio is even higher. Less than 10% inherited their wealth, the rest created it. 

 

And yes, tax RATES used to be higher. But did people really PAY those rates? Data suggests they didn't. Top 1% of earners payed about 40% of their income in taxes in the 1950s. About the same as today.

 

[KhunLA]

16 hours ago, findlay13 said:

The rich make the "laws" that allow them to avoid taxes, meanwhile telling the rest of us to "obey the law"

And everyone has access to the same laws.

 

USA, the 'poor' pay little to no tax, I know, I was one.  Then I started making money, and had to pay about 40% tax ... yea, that's fair.

 

The poor cry about paying next to nothing, and the better earners, simply try to keep as much as they've EARNED.  And some think there is something wrong with that.

[Chomper Higgot]

1 hour ago, Hanaguma said:

Billionaires employ thousands, if not millions of people.  They are worth defending.   

 

France tried overtaxing rich people in the mid 2000s with a wealth tax. It increased overall tax revenue by perhaps 1% on that tax, but resulted in thousands fleeing the country and a net loss of twice as much overall. 

 

https://www.bnnbloomberg.ca/france-tried-soaking-the-rich-it-didn-t-go-well-1.1347875

The economy creates jobs, not billionaires.

 

Neoliberalism, tax laws and regulations manipulated through the purchase of politicians creates billionaires while at the same time hollowing out the financial security of the rest of the population.

The wealth of the nation is built by the hard work of the blue collar and middle classes.

 

Time for them to once again get a fair share of that wealth.

 

 

[Chomper Higgot]

2 minutes ago, KhunLA said:

And everyone has access to the same laws.

 

USA, the 'poor' pay little to no tax, I know, I was one.  Then I started making money, and had to pay about 40% tax ... yea, that's fair.

 

The poor cry about paying next to nothing, and the better earners, simply try to keep as much as they've EARNED.  And some think there is something wrong with that.

The OP provides an example of a ‘law’ that the very wealthy have access to while the poor do not, shooting down your claim that everyone has access to the same laws. 

 

[KhunLA]

For the USA .. the unfair income tax.   I would have welcome a 'fair' flat tax of 15-20-25% across the board income tax.  FAIR ... everyone pays the same.

 

Nothing like crying about taxes they don't have to pay, while wanting other people's money, they didn't earn.  Want more money, go earn more, then cry about the unfair, extra tax you have to pay so support the 'lay abouts'.

 

Never had a problem paying taxes for social programs for those in need, but the others can stop crying about taxes they don't pay.

 

[placeholder]

39 minutes ago, Hanaguma said:

According to this source, a majority of billionaires made their money themselves, they did not inherit it.

 

https://www.statista.com/statistics/621426/sources-of-wealth-of-global-billionaires/

 

For "simple" millionaires the ratio is even higher. Less than 10% inherited their wealth, the rest created it. 

 

And yes, tax RATES used to be higher. But did people really PAY those rates? Data suggests they didn't. Top 1% of earners payed about 40% of their income in taxes in the 1950s. About the same as today.

 

Let's start with the last statistic first. Your claim is false. This is from taxfoundation.org which is a conservative group which advocates for lower taxes.

• The average income tax rate in 2020 was 13.6 percent. The top 1 percent of taxpayers paid a 25.99 percent average rate, more than eight times higher than the 3.1 percent average rate paid by the bottom half of taxpayers.

https://taxfoundation.org/publications/latest-federal-income-tax-data/

 

As for the role of inheritance in being wealthy in the USA:

"A recent study of ultra-rich Americans showed that almost three-quarters had help in building their fortunes. According to a Bank of America Private Bank study into the backgrounds of the ultra wealthy, the remaining 27% did not inherit any money at all. "

https://www.fool.com/the-ascent/personal-finance/articles/study-shows-only-27-of-wealthy-americans-are-self-made/#:~:text=28% have legacy wealth%3A People,affluent background and inherited money.

[Hanaguma]

5 minutes ago, placeholder said:

Let's start with the last statistic first. Your claim is false. This is from taxfoundation.org which is a conservative group which advocates for lower taxes.

• The average income tax rate in 2020 was 13.6 percent. The top 1 percent of taxpayers paid a 25.99 percent average rate, more than eight times higher than the 3.1 percent average rate paid by the bottom half of taxpayers.

https://taxfoundation.org/publications/latest-federal-income-tax-data/

 

As for the role of inheritance in being wealthy in the USA:

"A recent study of ultra-rich Americans showed that almost three-quarters had help in building their fortunes. According to a Bank of America Private Bank study into the backgrounds of the ultra wealthy, the remaining 27% did not inherit any money at all. "

https://www.fool.com/the-ascent/personal-finance/articles/study-shows-only-27-of-wealthy-americans-are-self-made/#:~:text=28% have legacy wealth%3A People,affluent background and inherited money.

Those stats from BofA are a joke. They consider getting only 12-20% of assets as "inheriting".  Not inheriting PLUS being middle class or lower is their definition of "self made", which is ridiculous.  How many actually took the family money and sat on it, or just swam in a pool full of gold coins? Very few.

 

As for taxes, look at what KhunLA posted for a clear picture of who pays what. 

[placeholder]

4 minutes ago, Hanaguma said:

Those stats from BofA are a joke. They consider getting only 12-20% of assets as "inheriting".  Not inheriting PLUS being middle class or lower is their definition of "self made", which is ridiculous.  How many actually took the family money and sat on it, or just swam in a pool full of gold coins? Very few.

 

As for taxes, look at what KhunLA posted for a clear picture of who pays what. 

I did look at at KhunLA posted? It lists the average income tax rate paid by the top 1% as 26.1%. Not anywhere close to the 40% that such taxpayers paid in the 50's.

What's more, these number don't reflected how the value of stocks has zoomed in relation to the economy.

https://tradingeconomics.com/united-states/stock-market-capitalization-to-gdp-for-united-states-fed-data.html

And one tactic employed by the wealthy to avoid paying taxes is to borrow against their assets, which are mostly stock and keep their salaries low. Loaned money is not taxed. So the wealthy pay just for the cost of interest on the loan which is substantially less than what they would pay on taxes.

And this is just one way the super wealthy avoid paying taxes.

[Longwood50]

10 hours ago, gamb00ler said:

You should re-think this a little.  TX gets back 83c for each federal tax dollar, Fl gets 77c and California gets 65c.  Does that sound like TX and FL are subsidizing CA?

I said those who get to deduct their California and New York income taxes are being subsidized.  Two people with identical income one in California and one in Texas, both itemize.  The Texas tax payer will pay more.  The majority of tax payers don't itemize.  

 

[Longwood50]

11 hours ago, Chomper Higgot said:

Hey look at you defending the billionaires.

I am not defending them.  What I am saying is there is no such thing as a loophole.  It is obvious you have no idea how tax loss selling works.  IT IS NOT A LOOPHOLE. 

Example Balmer owns two stocks.  He paid $5 million for each.  The first one increases in value to $7.5 million and he sells it for a $2.5 million gain.  The second one decreases to $2.5 million for a $2.5 million dollar loss.  So net HE EARNED ZERO

 

However the law states that unless Balmer sells the stock he has a loss in, he can not declare it on his tax return. 

So Balmer sells his stock at a loss to offset his "gain" otherwise he would pay tax on his $2.5 million dollar gain when in fact overall he really earned zero from the total of his investments. 

There are "no loopholes" there are only tax laws.  There are no tax havens, off shore accounts, that save people money.  The IRS says you must declare any and all income from any and all sources irrespective of how you earn it.  Technically a bank robber, drug dealer or a prostitute could be prosecuted for tax eveasion if they did not declare their earnings.  This idea that the wealthy don't pay their fair share of taxes is a myth that is peddled to garner votes from those who are not in the 1% and there are more of them.  The top 1% of earners in the USA pay more than the bottom 90% combined.  Use google it can be your friend. 

So in terms of jobs and tax revenues you want More Billionaires not fewer.  You are showing your class envy despising those who are successful. 

https://taxfoundation.org/publications/latest-federal-income-tax-data/#:~:text=In all%2C the top 1,90 percent paid %24450 billion.

[placeholder]

10 minutes ago, Longwood50 said:

Example Balmer owns two stocks.  He paid $5 million for each.  The first one increases in value to $7.5 million and he sells it for a $2.5 million gain.  The second one decreases to $2.5 million for a $2.5 million dollar loss.  So net HE EARNED ZERO

 

However the law states that unless Balmer sells the stock he has a loss in, he can not declare it on his tax return. 

So Balmer sells his stock at a loss to offset his "gain" otherwise he would pay tax on his $2.5 million dollar gain when in fact overall he really earned zero from the total of his investments. 

False. If Ballmer declares a loss on his tax sale, he can deduct that loss from any investment gains he made in that year. If he hadn't done that then he would have had to pay more in taxes that year. The artificial loss his transaction created is utterly irrelevant to the tax on his ultimate gains of those shares. And what you neglect to point out is that if Ballmer doesn't ever sell that stock, but passes it on to his heirs, no capital gains tax is due at all. 

[VocalNeal]

18 hours ago, RuamRudy said:

We have a king who doesn't have to pay the same inheritance tax as the majority

Dos he surrender the profits on crown properties to the government???? 

[placeholder]

55 minutes ago, placeholder said:

False. If Ballmer declares a loss on his tax sale, he can deduct that loss from any investment gains he made in that year. If he hadn't done that then he would have had to pay more in taxes that year. The artificial loss his transaction created is utterly irrelevant to the tax on his ultimate gains of those shares. And what you neglect to point out is that if Ballmer doesn't ever sell that stock, but passes it on to his heirs, no capital gains tax is due at all. 

I should add that no tax of any sort is going to be levied on those shares in the case of inheritance.

[RuamRudy]

3 hours ago, VocalNeal said:

Dos he surrender the profits on crown properties to the government???? 

Irrelevant. He has conditions that are not afforded to the majority.