American Airlines Bankruptcy - Your Perspective (Houston, Dallas: hotel, living in, law)

[Johnhw2]

Originally Posted by BigT3x

Until you can provide sources that contradict the numbers, you're just sticking your fingers in your ears and going "LALALALALA".

I mean, come on now. If the NYT just made these numbers up out of thin air, they would have been torn apart.

If you doubt the NYT has a slant on news you are not reading nor listening to all the sources. Anyone who uses the politically charged term tax loopholes best define exactly what they consider a loophole. If the GAAP is to deduct the cost of producing an income for revenues to get to profit then its not a tax loophole. NYT when they are carrying water for the left short cuts things and isnt definitive which makes me suspect their stories when I do not know the specifics like I do in this case.

[padcrasher]

Originally Posted by Johnhw2

If you doubt the NYT has a slant on news you are not reading nor listening to all the sources. Anyone who uses the politically charged term tax loopholes best define exactly what they consider a loophole. If the GAAP is to deduct the cost of producing an income for revenues to get to profit then its not a tax loophole. NYT when they are carrying water for the left short cuts things and isnt definitive which makes me suspect their stories when I do not know the specifics like I do in this case.

What's the correct phrase for "tax loophole"?

[BigT3x]

Originally Posted by Johnhw2

If you doubt the NYT has a slant on news you are not reading nor listening to all the sources. Anyone who uses the politically charged term tax loopholes best define exactly what they consider a loophole. If the GAAP is to deduct the cost of producing an income for revenues to get to profit then its not a tax loophole. NYT when they are carrying water for the left short cuts things and isnt definitive which makes me suspect their stories when I do not know the specifics like I do in this case.

The link we're discussing is a calculator based on widely agreed upon numbers. How can you add a liberal "slant" to numbers?

[BstYet2Be]

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[SimpleLife2]

Yeah, folks, seeing as AMR is one of the largest employers in the metroplex, I was hoping to hear more of what people are thinking about this big turn of events. I'd like to learn more -- about the events themselves, and about how my fellow metroplex citizens perceive the events. I'm actually surprised to see that there isn't more support for the labor unions on this forum. (Of course, I don't know the demographic that posts here.) I was guessing that, for the first time in decades, because of current events around the country and around the world, there would be more support and more empathy for labor than there has been in my lifetime.

If you have knowledge of the bankruptcy proceedings or strong opinions on the subject, I'd love to hear more!

[Cowboys fan in Houston]

Originally Posted by SimpleLife2

Yeah, folks, seeing as AMR is one of the largest employers in the metroplex, I was hoping to hear more of what people are thinking about this big turn of events. I'd like to learn more -- about the events themselves, and about how my fellow metroplex citizens perceive the events. I'm actually surprised to see that there isn't more support for the labor unions on this forum. (Of course, I don't know the demographic that posts here.) I was guessing that, for the first time in decades, because of current events around the country and around the world, there would be more support and more empathy for labor than there has been in my lifetime.

If you have knowledge of the bankruptcy proceedings or strong opinions on the subject, I'd love to hear more!

I have sympathy for labor, but not AAs unions. Talk about unions gone bad.

[synchronicity]

Originally Posted by Johnhw2

Also the US taxes world wide corporate income not just US as other civilized countries do.

Well, no, not exactly. The US only taxes "worldwide" income on corporations that operate pass-thru entities overseas (essentially "branches" or "partnerships") NOT on foreign subsidiaries (controlled foreign corporations or "CFCs" for short). Income from foreign subsidiaries is only taxed when it is repatriated to the US, and is eligible for a foreign tax credit (essentially, a credit for all foreign income taxes paid up to the US tax percentage. They don't get a refund if Elbonia's effective tax rate on income repatriated to the US is higher than the US rate, as we'd be effectively subsidizing Elbonia).

There is an exception to this for "subpart F" income (don't ask), which is deemed constructively paid back to the US even if it isn't (Subpart F was passed back in the early 60's IIRC as a response to some games MNC's played). But nowadays companies can get around Subpart F and play similar games to what they used to do.

Plus, in terms of PERSONAL income taxes, which are responsible for bringing in far more federal government receipts than corporate taxes, income taxes in the US are far lower than most other industrialized nations. And yes, effective tax rates on high AGI taxpayers are also quite low relative to most of the rest of the industrialized world as well.

Overall, federal receipts as a percentage of GDP are at their lowest levels since the very early 50's.

[synchronicity]

Also, my standard response to any question about "who is to blame for [name of airline]'s woes, Unions or Management?" is YES!!!

[Johnhw2]

Originally Posted by synchronicity

Well, no, not exactly. The US only taxes "worldwide" income on corporations that operate pass-thru entities overseas (essentially "branches" or "partnerships") NOT on foreign subsidiaries (controlled foreign corporations or "CFCs" for short). Income from foreign subsidiaries is only taxed when it is repatriated to the US, and is eligible for a foreign tax credit (essentially, a credit for all foreign income taxes paid up to the US tax percentage. They don't get a refund if Elbonia's effective tax rate on income repatriated to the US is higher than the US rate, as we'd be effectively subsidizing Elbonia).

There is an exception to this for "subpart F" income (don't ask), which is deemed constructively paid back to the US even if it isn't (Subpart F was passed back in the early 60's IIRC as a response to some games MNC's played). But nowadays companies can get around Subpart F and play similar games to what they used to do.

Plus, in terms of PERSONAL income taxes, which are responsible for bringing in far more federal government receipts than corporate taxes, income taxes in the US are far lower than most other industrialized nations. And yes, effective tax rates on high AGI taxpayers are also quite low relative to most of the rest of the industrialized world as well.

Overall, federal receipts as a percentage of GDP are at their lowest levels since the very early 50's.

My point is we need jobs and this tax on corporations with foreign operations makes us less competitive as does the tax rate on corporations. The jobs we lose cost us individual taxes even at the current rates. We also tax income individuals earn overseas unlike other countries. It smells like a corporate money grab to me with not enough attention to our competitive position for us companies and jobs as well they could provide here.

I suspect this tax treatment did not hit AA however as I understand the net income of the industry is a loss over the life of this industry.

[synchronicity]

Originally Posted by Johnhw2

My point is we need jobs and this tax on corporations with foreign operations makes us less competitive as does the tax rate on corporations. The jobs we lose cost us individual taxes even at the current rates. We also tax income individuals earn overseas unlike other countries. It smells like a corporate money grab to me with not enough attention to our competitive position for us companies and jobs as well they could provide here.

*sigh*

Corporations (at least those with any halfway decent tax departments, which would include "any corporation with respectable overseas operations") only have pass-thru entities in foreign countries to the extent they generate LOSSES which can then flow through to their US tax return. Otherwise they will segregate lower-taxed foreign income overseas most of the time.

THBS, well run corporations do a lot of tax planning but they most definitely do NOT let the tax tail wag the operational dog. If you think that by lowering corporate income tax rates it'll suddenly cause scads of jobs to flow to the US, you'd be mistaken. The biggest drivers of jobs overseas has been the generally "flatter" world and the ability to therefore take advantage of huge disparities in labor costs in various countries. However, there are multiple limits to that (for example, countries which have outsourced to China for cheaper labor have found that, SURPRISE, many Chines companies have been essentially engaging in outright theft of intellectual capital. Plus, labor costs in china have been increasing as that country's economy has improved).

As taxing worldwide income - again, A) the US allows a foreign tax CREDIT for income taxes paid in foreign countries, and 2) our personal income tax rates are generally LOWER than those in most other industrialized countries. (mainly because most other industrialized nations have greater government "social services" programs than the US, for better or for worse. The "for better or worse" is a related but different discussion.)

I don't want to go on about taxes too much in a thread on AMR's bankruptcy, but let's just say it's a topic that's vaguely familiar to me.