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In Gary Horton’s column “Everything’s coming up ‘Rosies’ for Hillary,” published in The Signal Oct. 5, the writer attempts to mount an attack using the Democrats’ topic du jour: Trump’s taxes. (I have to wonder if they send out memos with suggested talking points.)

So, Horton, look me in the eye (figuratively, of course) and tell me that you don’t take every single tax deduction you legally can.

Tell me that you willingly and knowingly pay more taxes than you’re legally obliged to.

Tell me that you, as a business owner, don’t pay out your own personal dollars to hire the absolute best tax preparers or attorneys or whatever you use to make sure you pay the absolute minimum amount to the government that you can get away with.

Tell me that if you have a year in which you legally owe no taxes, you’ll still turn around and write a check to the government anyway.

If you can’t do that, then you’re a blatant hypocrite for doing exactly what you’re trying to rake Trump over the coals for.

Well?

This nonsense is exactly why so many really good people simply refuse to participate in politics. Why would anyone want to subject themselves to such absurd attacks?

And why does anyone have to apologize for being a success at his or her business? Where’s all the outrage about Pelosi’s wealth? Why wasn’t the Kennedy fortune ever under such scrutiny? Would Truman have been blasted for being a failure in the business world?

Not to mention Clinton’s personal slush fund, her sham “foundation.”

This is utter insanity.

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  • Well, Mr. B, you’ve nailed it again! Like you, I pretty much despise the liberal thinker who says they are their “brother’s keeper” with one caveat: It must be legislated before they will actually “keep.” And, to enlighten Mr. Horton, should he read your column…Here is his lesson on Net Operating Losses, aka NOL, that Trump, and the NYT, and HRC used on their taxes.

    3 scenarios, each with the taxpayer making $1M over the course of a 2 year period, with tax rate being 40%. Tax law allows Net Operating Losses to be carried forward 20 Years.

    Scenario 1:
    Year 1: Taxpayer earns $500K and pays $200K in tax ($500K x 40%)
    Year 2: Taxpayer earns $500K and pays $200K in tax ($500K x 40%)
    $400K of total tax paid over 2 years on Total Earnings of $1M. Effective tax rate of 40%.

    Scenario 2:
    Year 1: Taxpayer Loses $1M and pays $0 tax due to there being no Income
    Year 2: Taxpayer earns $2M and pays $400K in tax ([$2M less Net Operating Loss from Year 1 of $1M] x 40%)
    $400K of total tax paid over 2 years on Total Earnings of $1M. Effective tax rate of 40%.

    Scenario 3:
    Year 1: Taxpayer Loses $2M and pays $0 tax due to there being no Income
    Year 2: Taxpayer earns $3M and pays $400K in tax ([$3M less Net Operating Loss from Year 1 of $2M] x 40%)
    $400K of total tax paid over 2 years on Total Earnings of $1M. Effective tax rate of 40%.

    WITHOUT the ability to utilize Net Operating Losses (a concept in tax law since its inception over 100 years ago and hardly a secret “Loophole”) our Taxpayer would have different outcomes for each of the above Scenarios as follows:

    Scenario 1:
    Year 1: Taxpayer earns $500K and pays $200K in tax ($500K x 40%)
    Year 2: Taxpayer earns $500K and pays $200K in tax ($500K x 40%)
    $400K of total tax paid over 2 years on Total Earnings of $1M. (Note – no Net Operating Losses so no difference from the above Scenario 1)

    Scenario 2:
    Year 1: Taxpayer Loses $1M and pays $0 tax due to there being no Income
    Year 2: Taxpayer earns $2M and pays $800K in tax ($2M x 40%)
    $800K of total tax paid over 2 years on Total Earnings of $1M. (Note – Taxpayer pays $400K more in taxes on the same $1M in earnings. THIS RESULTS IN AN EFFECTIVE TAX RATE OF 80%!!

    Scenario 3:
    Year 1: Taxpayer Loses $2M and pays $0 tax due to there being no Income
    Year 2: Taxpayer earns $3M and pays $1.2M in tax ($3M x 40%)
    $1.2M of total tax paid over 2 years on Total Earnings of $1M. (Note – Taxpayer pays $800 more in taxes on the same $1M in earnings. THIS RESULTS IN AN EFFECTIVE TAX RATE OF 120%!!!

    Therefore, the ability to use a Net Operating Loss is not some fancy tax loophole, it’s just a common sense calculation that’s been part of our Tax Law for over 100 Years.

    • James de Bree

      It is interesting that for many years California did not allow the carryover or carryback of net operating losses. That contributed to the exodus of many industries with cyclical businesses.

  • And as to HRC and her wonderful ClintonCrimeFamily Foundation? In 2014, they had revenues of 172M. Of that 5.1M went to grants to charities…They spent 15M on events that lost 1.1 million!! Wait, there’s more. 27.2M in salaries and wages, but you can only see “Key Officer Compensaton” (not HRC, WJC, CC) yet, Chelsea lives in a NY Flat worth 5 million and she has a husband whose hedge fund adventures lost millions? You honestly believe HRC and the rest of her CCF don’t use the NOL against their income, whether ordinary or Capital gains? These people are stuck on stupid and blind as bats. They spent less than 6% of their money to do “good” and by good, I mean they lined their own pockets. http://www.guidestar.org/FinDocuments/2014/311/580/2014-311580204-0c3ee98d-9.pdf

    • James de Bree

      Denise, I am not sure that I fully understand your comments. I presume that you have a pretty good understanding of tax principles based on your posts. But in this post, you are comparing apples with oranges and are making some statements that perhaps need additional discussion to accurately assess.

      First of all, the Clinton foundation is a public charity that is exempt from income taxes. Unless a charitable organization conducts a trade or business that is unrelated to its exempt function, the concept of a net operating loss is non-existent. That is the apples and oranges reference. When you say that the Clintons are using NOLs against their income, they can only use NOLs from losses that they individually incur. There are no NOLs on Hillary’s tax returns. Please clarify your comment.

      In your comment indicating that the Clinton Foundation spent only 6% on “good”, I presume that you are referring to the amount of grants disclosed on Line 17. However, the Clinton Foundation also conducts charitable activities on its own. Please refer to Part IX of the form 990 to which you linked in your post. The Foundation spent $72 million on program related expenses.

      That is approximately 80% of its expenditures. What is disturbing is that they spent $18.7 million on administration and fundraising. Usually charities don’t want to spend more than 10% on those categories.

      The other question is why is the Foundation accumulating cash instead of spending it on charitable endeavors? They raised ~$86 million more than they spent. Considering that they spent $6.7 million on fundraising, one has to wonder what they plan to do with the cash. The return states that the funds represent “an endowment to support the ongoing mission” of the Foundation.

      In my view this is the crux of the issues surrounding the Clinton Foundation.

      Finally, based on the disclosure in the compensation section of the tax return, it appears that HRC,WJC and CC each spent 20-25 hours a week on foundation matters without taking a salary. If they had received remuneration from the Clinton Foundation, it would have been disclosed on this schedule, therefore, I don’t understand you comment about compensation.

  • Brian Baker

    Hey, Nee, thanks for taking the time to post that great stuff here. Wonderful illustrations.

  • I just had to laugh that Horton thought it was a good idea mentioning Rosie in a yet another slobbering hrc lovefest. Speaking of Rosies, am I the only one that thinks hrc sounds just like Roseanne Barr?