Two-thirds of U.S. corporations did not pay federal income tax. GAO Report

[OpportunityCost]

think you are missing the picture, most companies pay no income tax because they lost money or were still carrying losses from a previous year. and most of the ones who dont pay taxes are also small business.

You are onto something but so is the poster speaking about lobbying.

15 Fortune 500 Companies Paid No Federal Income Taxes in 2014 | The Fiscal Times

Look at the list at the bottom.
CBS
PG&E
GE
JetBlue
Pepco (utility)
Priceline
Qualcomm
Ryder
Time Warner
Xerox

Some interesting names and I know why some of them are getting off the tax hook.

 

[SheWolf]

ah an anti corporate rant. so they provide jobs to Citizens, and produce stuff Americans want-how are they "takers"

takers to me are those who suck on the public tit and do nothing valuable for us tax payers.

This is a really unsophisticated argument TD. What you said boils down to, "they do something special, so it's OK they don't pay taxes."

Its not OK that they don't pay taxes. It is not OK that your generation blew up the national debt, and left my generation with the bill. Millenial verterans have fought in wars longer than WWII veterans and are not getting proper health care. Their GI Bills are not covering all their college costs anymore. If my generation is expected to do more than our fair share, then a billion dollar corporation should be expected to pay some damn taxes.

I have said before that I am a tax accountant for a CPA firm. I am very informed on the issue of taxes. I know I pay more to the federal government than the average person of your generation and I have not received as many "privileges" or "free stuff" as the baby boomers. I work with millionaire clients who pay taxes, old ladies living on pensions and SS paying taxes, etc. There is no reason why these corporations should be paying absolutely nothing.

 

[Moderate Right]

I own a Subchapter S corporation. You could put my company in that two thirds. The company does not pay taxes on the profit it makes. All profit is passed through to my personal tax return and paid at the individual tax rate. The company does, however, pay employer taxes on Unemployment Insurance, Medicare, and Social Security - as does every employer in the US (exception being a 501(c)(3) that has 4 or less employees, and although they do not pay FUTA and in most cases SUTA, they still pay Medicare, and Social Security [FICA] on all their employees).

I also have a Sub S. In fact, many small businesses are sub S, which makes this thread very misleading.

 

[Cyrylek]

Wouldn't it be lovely if someone on the left quoting GAO could force himself to extend the quote to the very next sentence?

"Of those large corporations whose financial statements reported a profit, 19.5 percent paid no federal income tax that year. Reasons why even profitable corporations may have paid no federal tax in a given year include the use of tax deductions for losses carried forward from prior years and tax incentives, such as depreciation allowances that are more generous in the federal tax code than those allowed for financial accounting purposes".

While I am all for eliminating "tax incentives" (a form of corporate welfare distorting the market), only 19.5% not paying this particular year for the two reasons combined is a very low number.

 

[JasperL]

I also have a Sub S. In fact, many small businesses are sub S, which makes this thread very misleading.

It's not explicitly stated in the study, but the study can only be looking at C corps. I skimmed the study and attachments and never noted any instance of the study mentioning one reason why "corporations" didn't pay federal income tax is because they made an S election.

 

[Fledermaus]

How about corporations pay their fair share and stop mooching off the little guy???

Read post #10

Then tell us what a "fair share" is.

 

[JasperL]

Wouldn't it be lovely if someone on the left quoting GAO could force himself to extend the quote to the very next sentence?

"Of those large corporations whose financial statements reported a profit, 19.5 percent paid no federal income tax that year. Reasons why even profitable corporations may have paid no federal tax in a given year include the use of tax deductions for losses carried forward from prior years and tax incentives, such as depreciation allowances that are more generous in the federal tax code than those allowed for financial accounting purposes".

While I am all for eliminating "tax incentives" (a form of corporate welfare distorting the market), only 19.5% not paying this particular year for the two reasons combined is a very low number.

I agree with that for the most part. The study period was 2006-2012, so several of those years were during the Great Recession and it would be natural for corporations to generate losses, and for some number of them to be able to carry them forward for a few years. What's pretty clear in the data is that the effective tax rates for corporations have been trending down over time, and at the state and federal level, and it's a fair point that lots of that is probably due to legislated tax breaks and aggressive/inventive/borderline or actually fraudulent tax planning efforts. For multi-nationals, a lot of it is the ability to defer U.S. taxation on foreign earnings until earnings are repatriated, and so they spend lots of effort shifting income offshore to low tax regions and then leave the money offshore.

My own view is the corporate tax system is pretty broken. Not sure what to replace it with, but some tax on activity instead of the shifting concept of 'taxable income' might work better.

 

[CanadaJohn]

So your Supreme Court and Mitt Romney were right!!

This article claims two thirds of corporations don't pay federal income taxes and about half of all American citizens don't pay federal income taxes: ergo, the Supreme Court and Mitt Romney were right, corporations are people too.

 

[TurtleDude]

This is a really unsophisticated argument TD. What you said boils down to, "they do something special, so it's OK they don't pay taxes."

Its not OK that they don't pay taxes. It is not OK that your generation blew up the national debt, and left my generation with the bill. Millenial verterans have fought in wars longer than WWII veterans and are not getting proper health care. Their GI Bills are not covering all their college costs anymore. If my generation is expected to do more than our fair share, then a billion dollar corporation should be expected to pay some damn taxes.

I have said before that I am a tax accountant for a CPA firm. I am very informed on the issue of taxes. I know I pay more to the federal government than the average person of your generation and I have not received as many "privileges" or "free stuff" as the baby boomers. I work with millionaire clients who pay taxes, old ladies living on pensions and SS paying taxes, etc. There is no reason why these corporations should be paying absolutely nothing.

stop the silliness. I pay over a half million dollars in FIT and state income tax now. and those who invest in corporations and those who earn money from corporations pay plenty of taxes.

 

[haymarket]

This Study Shows How Low Corporate America's Taxes Really Are
Two-thirds of U.S. corporations did not pay federal income tax. GAO Report


… “A new government report shows just how easy corporate America has it” …

Every year from 2006 to 2012, some two-thirds of U.S. corporations did not pay federal income tax, according to a Government Accountability Office study released on Wednesday. In 2012 alone, 42.5 percent of businesses that the GAO defines as large did not pay federal taxes, including 19.5 percent of big corporations that posted a profit.

Please what's all the noise about the US not having competitive corporate tax rates………….it is costing us jobs……….

Well I think it’s all a bunch of crap------------- Most of those damn corporations don’t pay a dime in taxes anyway…….and far as those jobs……………. what make’s yall think they give two toots about y’all………

... they took all the good jobs away and I damn sure there’s no plans to bring them jobs back............

... just because the tax rate was lowered from 25% to 15% …..


Are yall starting to get the picture?

Thank you for alerting us to this travesty. There is no excuse for this and we need to correct it asap.

 

[Geoist]

If you don't want the rich/corporations to evade taxes then replace most taxes with land value tax. You cannot hide land in the Cayman Islands. The solution is simple, yet almost no politician would be willing to take up the cause (as they or their contributors benefit from land/resource speculation).

 

[SheWolf]

stop the silliness. I pay over a half million dollars in FIT and state income tax now. and those who invest in corporations and those who earn money from corporations pay plenty of taxes.

The only thing silly is your stream of responses. We are talking about corporations not paying taxes. We are not taking about working people and investors paying taxes or not. Are you intentionally moving the goal post? You have said nothing about these corporations not paying taxes.

Do you think you're overtaxed? Are you fine with carry that burden whilst these corporations pay nothing?

 

[sangha]

Logic dictates that if you made your tax rates competitive they might actually pay tax.

Yeah, because most corporations prefer a tax rate above 0 to one that is 0!!! :screwy

 

[TurtleDude]

The only thing silly is your stream of responses. We are talking about corporations not paying taxes. We are not taking about working people and investors paying taxes or not. Are you intentionally moving the goal post? You have said nothing about these corporations not paying taxes.

Do you think you're overtaxed? Are you fine with carry that burden whilst these corporations pay nothing?

lets try again, I don't believe corporations should be taxed. I don't believe in income taxes or a tax on profits.

 

[Carjosse]

Yeah, because most corporations prefer a tax rate above 0 to one that is 0!!! :screwy

Well Canada does not have a much lower corporate tax rate but we do have a slightly lower one, and US companies still do inversions to pay less tax like Burger King.

 

[sangha]

I own a Subchapter S corporation. You could put my company in that two thirds. The company does not pay taxes on the profit it makes. All profit is passed through to my personal tax return and paid at the individual tax rate. The company does, however, pay employer taxes on Unemployment Insurance, Medicare, and Social Security - as does every employer in the US (exception being a 501(c)(3) that has 4 or less employees, and although they do not pay FUTA and in most cases SUTA, they still pay Medicare, and Social Security [FICA] on all their employees).

The report did not include S-corps or other forms of pass-through entities (see footnote 3 on page 2)

 

[sangha]

There is so much crap in this meme that my waders start to fill up.

First off, as Beaudreaux said, Scorps are pass through entities which are taxed at the individual level but even if we leave them out of the equation you've still got private C corporations which, since they are taxed at 35% on damned near everything, bump up the principle's wages until any profit gets used up. The owner then pays taxes on his increased wages.

For public corporation, especially international ones, they pay foreign taxes on their foreign profits. If that tax is more than what they would have owed on that money here then they don't pay US taxes on that income. Other corporations may have generated a significant loss in a prior year. If that happens then they get to use that loss to offset profit in the current year. Everybody loves to bitch about CEO's getting humongous salaries when their corporations have huge losses, well, those losses are why the corporation doesn't pay taxes in the year it has a huge profit. By the way, if you think that rule is just for big corporations you're wrong. You get the same treatment when you have a business NOL for your home blogging/ebay business.

S-corps were not included in the report

 

[sangha]

I also have a Sub S. In fact, many small businesses are sub S, which makes this thread very misleading.

And another poster criticizes the report for doing something it didn't do\

The report didn't include S-corps or other pass through entities

Which makes your comments very misleading

It's not explicitly stated in the study, but the study can only be looking at C corps. I skimmed the study and attachments and never noted any instance of the study mentioning one reason why "corporations" didn't pay federal income tax is because they made an S election.

See above

 

[sangha]

Well Canada does not have a much lower corporate tax rate but we do have a slightly lower one, and US companies still do inversions to pay less tax like Burger King.

No more than a handful of corps do an inversion in any given year and the feds have cracked down on inversions

 

[cpwill]

This Study Shows How Low Corporate America's Taxes Really Are
Two-thirds of U.S. corporations did not pay federal income tax. GAO Report

… “A new government report shows just how easy corporate America has it” …

Every year from 2006 to 2012, some two-thirds of U.S. corporations did not pay federal income tax, according to a Government Accountability Office study released on Wednesday. In 2012 alone, 42.5 percent of businesses that the GAO defines as large did not pay federal taxes, including 19.5 percent of big corporations that posted a profit.

Please what's all the noise about the US not having competitive corporate tax rates………….it is costing us jobs……….

Well I think it’s all a bunch of crap------------- Most of those damn corporations don’t pay a dime in taxes anyway…….and far as those jobs……………. what make’s yall think they give two toots about y’all………

... they took all the good jobs away and I damn sure there’s no plans to bring them jobs back............

... just because the tax rate was lowered from 25% to 15% …..


Are yall starting to get the picture?

If only there was a candidate running for President on a platform of getting rid of a super-complex tax code that wealth corporations will always be able to afford the lawyers and accountants to leverage in favor of a simple flat business tax....

 

[JasperL]

And another poster criticizes the report for doing something it didn't do\

The report didn't include S-corps or other pass through entities

Which makes your comments very misleading

See above

Thanks. I looked for a section on sample, and even did a "Command F" search for 'S corporation' and nothing came up. Just did it again and it pointed me right to that FN. Probably spelled 'corporation' wrong first time.... Had to be that way but thanks for confirming it.

 

[fmw]

No, we should call these "takers" what they are.

The taker would be the federal government. You need to understand that the public actually pays corporate taxes. Corporate taxes are cost entry in the profit and loss statement. The company already built them into the price of its products or services. But if soaking the public for more corporate taxes is appealing to you, you should contact your representative and suggest a change in the tax laws. You will be up against some serious corruption, however.

 

[American]

This Study Shows How Low Corporate America's Taxes Really Are
Two-thirds of U.S. corporations did not pay federal income tax. GAO Report


… “A new government report shows just how easy corporate America has it” …

Every year from 2006 to 2012, some two-thirds of U.S. corporations did not pay federal income tax, according to a Government Accountability Office study released on Wednesday. In 2012 alone, 42.5 percent of businesses that the GAO defines as large did not pay federal taxes, including 19.5 percent of big corporations that posted a profit.

Please what's all the noise about the US not having competitive corporate tax rates………….it is costing us jobs……….

Well I think it’s all a bunch of crap------------- Most of those damn corporations don’t pay a dime in taxes anyway…….and far as those jobs……………. what make’s yall think they give two toots about y’all………

... they took all the good jobs away and I damn sure there’s no plans to bring them jobs back............

... just because the tax rate was lowered from 25% to 15% …..


Are yall starting to get the picture?

Did they pay corporate taxes?

 

[JasperL]

If only there was a candidate running for President on a platform of getting rid of a super-complex tax code that wealth corporations will always be able to afford the lawyers and accountants to leverage in favor of a simple flat business tax....

If only that candidate didn't imagine that an over $8 TRILLION tax cut over 10 years was viable. It's easy to have a nice sounding tax plan when you can disregard reality....

I assume you're talking about Cruz.

 

[faithful_servant]

This Study Shows How Low Corporate America's Taxes Really Are
Two-thirds of U.S. corporations did not pay federal income tax. GAO Report


… “A new government report shows just how easy corporate America has it” …

Every year from 2006 to 2012, some two-thirds of U.S. corporations did not pay federal income tax, according to a Government Accountability Office study released on Wednesday. In 2012 alone, 42.5 percent of businesses that the GAO defines as large did not pay federal taxes, including 19.5 percent of big corporations that posted a profit.

Please what's all the noise about the US not having competitive corporate tax rates………….it is costing us jobs……….

Well I think it’s all a bunch of crap------------- Most of those damn corporations don’t pay a dime in taxes anyway…….and far as those jobs……………. what make’s yall think they give two toots about y’all………

... they took all the good jobs away and I damn sure there’s no plans to bring them jobs back............

... just because the tax rate was lowered from 25% to 15% …..


Are yall starting to get the picture?

Businesses shouldn't pay taxes. A business tax is simply a tax on the people who buy their products. If you tax a toilet paper manufacturer, then what you are really doing is taxing people for wiping their butts, since that expense gets pushed down to the consumer. Of course, it's easier to pass a tax on a big multi-million $$ paper products co. then it is to tax people for wiping their butts. Corporate taxes are simply a dishonest way of taxing people without their knowledge.