And now you know ... the rest ... of the story ...

[LWW]

Warren Buffet's secretary pays a higher tax rate than Warren Buffet because ...
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<span style='font-size: 14pt'>Warren Buffet is apparently a tax dodger that owes roughly</span> <span style='font-size: 20pt'><u>$1,000,000,000.00</u></span> <span style='font-size: 14pt'>in back taxes for the last decade.</span>
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">Funny thing is, it turns out Buffett was being… shall we say… disingenuous when he claimed his “leaders” never got around to asking for his “shared sacrifice.” His company, Berkshire Hathaway, has been fighting the IRS tooth and nail to avoid paying its federal tax bill for nearly a decade.

How much of the State’s rightful money has this hypocrite been clutching in a white-knuckled death grip? Oh, only about a billion dollars or so. Bill Wilson of Americans for Limited Government tallies up the bill:

Using only publicly-available documents, a certified public accountant (CPA) detailed Berkshire Hathaway’s tax problems to ALG researcher Richard McCarty. Now, the American people have a better idea of how much in back taxes the company could owe Uncle Sam.

According to page 56 of the company report, “At December 31, 2010… net unrecognized tax benefits were $1,005 million”, or about $1 billion. McCarty explained, “Unrecognized tax benefits represent the company’s potential future obligation to the IRS and other taxing authorities. They have to be recorded in the company’s financial statements.”

He added, “The notation means that Berkshire Hathaway’s own auditors have probably said that $1 billion is more likely than not owed to the government.”

</div></div>
This has been a public service announcement by LWW ... reporting the news the US leftist media just won't report any longer. (http://www.humanevents.com/article.php?id=45889)

[Soflasnapper]

How wrong is all of this?

Roughly everything, from beginning to end.

1) Buffet's personal tax RATE isn't determined by how much Berkshire Hathaway pays or doesn't pay in taxes. Meaning the entire premise of this 'gotcha' is false. Blatantly false.

2) We get a sense of the sheer incompetence in the page number cited, page 56. If you follow the link at the link to this report, you will find nothing about this issue on page 56. It's on page 54, with a nice little notation of 'Page 54' at the bottom of the page, indicating it's page 54, not page 56.

3) Then there's this lie: He added, “The notation means that Berkshire Hathaway’s own auditors have probably said that $1 billion is more likely than not owed to the government.”

No, they didn't probably say that at all, and instead, <span style='font-size: 14pt'>directly</span> said, this:

<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> The remaining balance in net unrecognized tax benefits principally relates to tax positions <span style='font-size: 17pt'>for which the ultimate deductibility is highly certain </span>but for which there is uncertainty about the timing of such deductibility.</div></div>

It takes a relatively stupid person to imagine that 'unrecognized tax BENEFITS' are 'unpaid tax LIABILITIES.'

Paul Harvey was unlikely to have made such a howling error.

[LWW]

<div class="ubbcode-block"><div class="ubbcode-header">Originally Posted By: Soflasnapper</div><div class="ubbcode-body">How wrong is all of this?

Roughly everything, from beginning to end.

1) Buffet's personal tax RATE isn't determined by how much Berkshire Hathaway pays or doesn't pay in taxes. Meaning the entire premise of this 'gotcha' is false. Blatantly false. </div></div>

Oh just how precious is that.

Here's a clue:

1 - Buffet's tax rate is based on the stock appreciation and after tax profits of BH.

2 - The stock appreciation and after tax profits of BH are based in large part on how much tax they pay ... or evade.

3 - If BH makes nothing, Buffet makes nothing or next to nothing.

4 -The more overhead, of which taxation is a large part, BH can avoid ... the higher their after tax profits are.

5 - The higher their after tax profits are, the more Buffet makes.

Next from sofanapper ... water isn't actually wet.

[Soflasnapper]

Idgit!

Buffet gets a preferred rate on his income, because he structures it as interest, dividends, or cap gains. (He doesn't pay a low rate because he gets his 'income' down to under $250,000. He has millions a year in income.)

He could double his income, or 10x it, and still pay the same RATE, which is the preferred rate of a max of 15%.

His complaint is about the RATE. Not the amount. Of course, even at the preferred rate, he probably outpays his secretary as to the amount by 1,000 to 1 or more. He's not paying LESS than she is, he is paying a LOWER TAX RATE, on 1,000s of times the income.

[LWW]

If he could simply double it ... why doesn't he?

Let me boil it down for you nitboy ...

1 - Does or does not WB get the majority of his income from BH?

2 - Is the BH net larger if they pay lower taxes?

[Soflasnapper]

1) Probably he does.

2) Sure.

Neither of which has a thing to do with your post material.

In fact, unrealized tax <u>benefits</u> are things like capital loss carry forward, carried interest, depreciation, and other tax credits not yet applied for.

The part I quoted may be related to some accelerated depreciation schedules that are now in the law, but might be changed in the future to purely straight-line depreciation. Which, as they state, changes NOT the AMOUNT of deduction available in total, but rather the time over which the deduction must be taken.