Dead Peasant Insurance - Another Way Corporate America Steals Our Money (And inflates the USD?) - Page 3 - Politics and Economics

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Dead Peasant Insurance - Another Way Corporate America Steals Our Money (And inflates the USD?)

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11-05-2009 , 02:54 AM

#51

Double Eagle

Health Care Thread Czar

Join Date: Dec 2003 Posts: 8,323

Quote:

Originally Posted by DMACM

I know its pretty common for lawyers to take out life insurance on each other. Is this why?

No, partnership life insurance is taken out because the partner is considered a key element of the business. Any tax benefits are secondary.

11-05-2009 , 02:55 AM

#52

ikestoys

banned

Join Date: Nov 2006 Posts: 94,424

Quote:

Originally Posted by cuserounder

You could word it that way. They've found a loophole to not pay as much on their taxes. When numerous large corporations do this, it means less tax revenue and higher deficit... The higher the deficits run the more risk of inflation, then everyone's dollars are worth less and we've all been taxed that way.

Essentially they are finding ways to toss their tax burden back into the pool so everyone can soak up a bit.

Well when I deduct my charity donations I'll think of how I'm stealing from you!

11-05-2009 , 10:24 AM

#53

cuserounder

Carpal \'Tunnel

Join Date: Oct 2005 Posts: 8,219

Quote:

Originally Posted by ikestoys

Well when I deduct my charity donations I'll think of how I'm stealing from you!

That's very different, assuming you actually made the donations. This is more like, you donate a large percentage of your income to a charity, they keep 10% and give you the rest back and it becomes tax free.

The purpose of these insurance policies has nothing to do with insuring the company against the death of an employee and everything to do with reducing taxable income.

11-05-2009 , 11:01 AM

#54

AKSpartan

Carpal \'Tunnel

Join Date: Mar 2008 Posts: 9,931

Is it really that hard to see that the one to blame here is the one levying the taxes and inflating the dollar through artificial money creation, not the one looking to reduce their burden of these taxes?

OP, why do you assume taxation is legitimate in the first place? That's your mistake.

11-05-2009 , 12:00 PM

#55

pvn

Guest

Posts: n/a

Quote:

Originally Posted by cuserounder

No, you've done well for yourself. Your money has already been taxed. Say we have a juice company that made 200 million this year. So they would probalby owe something like 50-60 million in taxes? I don't know how high the rates get on corporations. But the numbers being exact is not the point. Then then take the 200 million, but a bunch of this life insurance policies and write the money off the books as debt - its tax deductible now, those debt payments.

Now, lets say everyone dies the same day just to simplify our example. They collect like 185 million, the insurance company made like 15 million off the profits, and now the 185 million is tax free. Our juice company just saved 45 milion in taxes. Our insurance company made 15 million.

All of that came off of what should have been tax revenue. That should have been 60 million going towards our expendetures, shrinking the deficit, helping the dollar hold on to a little bit of value by limiting inflation a bit.

So do you think life insurance proceeds should be taxed?

11-05-2009 , 12:36 PM

#56

bobman0330

Carpal \'Tunnel

Join Date: Aug 2004 Posts: 24,234

Quote:

Originally Posted by cuserounder

Again, this is not how it works. The premiums aren't deductible. The tax break is on the build-up of value in the policy over time.

11-05-2009 , 12:38 PM

#57

Double Eagle

Health Care Thread Czar

Join Date: Dec 2003 Posts: 8,323

Quote:

Originally Posted by bobman0330

Again, this is not how it works. The premiums aren't deductible. The tax break is on the build-up of value in the policy over time.

They are almost always debt financed so the interest is deductible as well.

11-06-2009 , 10:13 PM

#58

chucky

Pooh-Bah

Join Date: Feb 2006 Posts: 4,998

If this had existed in the plot Kurosawa's "High and Low" the movie would have been ten minutes long. Kidnappers mistakenly take son of executive's driver. Executive doesnt pay. Son is killed. Executive goes to bank to deposit check.

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