Will you buy into this IPO?

[ack]

The Empire State Building and all of its 3300 shares may go up for trade soon - http://money.cnn.com/2013/05/29/investing/empire-state-building-ipo/index.html?iid=HP_LN
So what the heck does it mean to take a building public??? Who will trade the shares and why?

 

[rockitman]

I wouldn't. REIT or Real Estate Investment Trusts have become very popular from a taxation perspective.
http://en.wikipedia.org/wiki/Real_estate_investment_trust

 

[MylesBAstor]

I wouldn't. REIT or Real Estate Investment Trusts have become very popular from a taxation perspective.
http://en.wikipedia.org/wiki/Real_estate_investment_trust

By popular I assume you mean a red flag for the IRS Christian? Why does the IRS go after these REITs?

 

[rockitman]

By popular I assume you mean a red flag for the IRS Christian? Why does the IRS go after these REITs?

Red flag ? No, if you qualify then those are the tax rules that apply. That is the beauty of our convoluted tax system. Smart people use it to their advantage...legally.

 

[mep]

Our tax code was written for the advantage of the wealthy and to the detriment of the middle class.

 

[mojave]

Our tax code was written for the advantage of the wealthy and to the detriment of the middle class.

I think our tax code makes it easy for lower class to become middle class and for middle class to become upper class. Under the current tax code if you make under $50,000 a year and are married with kids you don't pay any taxes and get up to $6,000 in tax credits on top of that. They call them tax "credits," but if you don't owe taxes you get it as a payment.

 

[mep]

I think our tax code makes it easy for lower class to become middle class and for middle class to become upper class. Under the current tax code if you make under $50,000 a year and are married with kids you don't pay any taxes and get up to $6,000 in tax credits on top of that. They call them tax "credits," but if you don't owe taxes you get it as a payment.

Say what?? When did that change? Back once upon a long time ago I would have qualified for that tax-free break, but that never happened. I think you are wrong unless you mean you make under $50K and you are married to the Old Lady Who Lived in the Shoe and you have a ton of kids. And besides all of that, tax codes don't make it easy to step up from lower class to middle class or middle class to upper class. You actually need to make more money in order to make that happen.

 

[edorr]

I think our tax code makes it easy for lower class to become middle class and for middle class to become upper class. Under the current tax code if you make under $50,000 a year and are married with kids you don't pay any taxes and get up to $6,000 in tax credits on top of that. They call them tax "credits," but if you don't owe taxes you get it as a payment.

If you make $50K you pay relatively low income tax. However, your pay payroll tax and sales tax which are both highly regressive. As a result, said lower middle class worker pays an effective tax rate close to what Mitt Romney is paying. Irrespectively, no matter how much or little paxes you pay when you make 50K, there is not way you can "save" your way into moving up the social ladder. The only way to do this is to start making more money, which will be taxed at a higher rate.

 

[mojave]

If you make $50K you pay relatively low income tax. However, your pay payroll tax and sales tax which are both highly regressive. As a result, said lower middle class worker pays an effective tax rate close to what Mitt Romney is paying. Irrespectively, no matter how much or little paxes you pay when you make 50K, there is not way you can "save" your way into moving up the social ladder.

Yes, one does pay 7.65% for Medicare/FICA. These increase to 8.55% when one gets above $200,000 in earnings. I understand your point about these being highly regressive. I guess I don't really consider sales tax to be regressive. We have no sales tax on food in Nebraska so that helps. Last year I paid about $4500 in vehicle tax, property taxes (not including taxes on rental property owned), and sales/use tax. Yes, I did report internet purchases on my state tax return and remitted use tax.

The only way to do this is to start making more money, which will be taxed at a higher rate.

As rockitman pointed out, REIT's have some tax benefits. Even just owning rental property has tax benefits. Owning rental property doesn't necessarily make you more money cash flow wise, but it increases your net worth. 11 years ago I didn't own a home. I used $3000 as a down payment on a triplex and lived in one of the units. Now I own two more 4-plexes, my own home, and an acreage I plan to build a new house on. I have loans on the properties (except the acreage), but the properties now have a net worth of around $400,000. I haven't put any of my own income into them.