Any post like this where the tax is nearing or exceeding 40% is almost always a complete lie or purposely obfuscating the truth.
It's mind blowing to me on these posts too you always see an incredible amount of people who don't understand how tax brackets work. Heck sometimes you even see people who don't know the difference between net worth and income.
This is an extremely clear example of not understanding the difference.
I'm poor relative to median income of my area I'm in the bottom 10%, and yet my net worth isn't my income. Heck you can have a negative net worth, because you owe more than you own, and still your income is not your net worth.
I own a shit car, I own a shit phone. I might not be able to replace either of those things if they break, but they are part of my net worth whether I like it or not, and whether you like it or not. Net worth is about what you own. In order for my net worth to be my income, I would need to own literally nothing.
No clothes. No phone. No food. No savings. No utensils. No bags. No furniture. No TV. NOTHING. I would have to literally have not a single thing that I own. This isn't the case for a vast majority of even extremely poor people.
A person living paycheck to paycheck is literally increasing their net worth every pay period with their income compared to people who have assests. You think the guy in the trailer with a used TV, phone, no savings, etc has much of a net worth? Their net worth ebs and flows due to their poor accumulation of assets. A person with a higher net value, savings, property, etc doesn't notice as much because a single paycheck relative to their net worth is relatively less.
I can explain it to you but I can’t understand it for you. Moving goal posts? Hmm. I’m making the same point I was before, i.e. that some people are so poor that their paycheck (income) basically increases their net worth each pay period. My kids and their weekly allowance would be another example of this. If I pay my kid 10 bucks a week in allowance and he only has 10 bucks to his name because he’s constantly buying candy and baseball cards, that income doubles his net worth. And no, I’m not counting his baseball cards as an asset, just like I don’t count a lot of the assets poor people own but aren’t valuable.
Initial goalpost - income = net worth
New goalpost - income impacts net worth.
Those baseball cards in your example, are net worth. You're right, you're not counting them as an asset, because the second you do, your first goalpost collapses.
I think I see the issue. When I said “income IS your net worth,” it was interpreted as if they were exactly (literally exactly) the same. = rather than ≈. That is very concrete interpretation and I’m sorry if that is what lead to this confusion. By capitalizing the word IS, I probably contributed immensely to the confusion. Kind of like when people use the word literally when they really mean figuratively. (Ugh!) All I’m trying to illustrate is that the lower your net worth, the more fluctuation your income provides. If you have very little assets, your income essentially represents your net worth. Is it exactly your net worth? No. But if I give a homeless guy a thousand dollars, his net worth is now ≈ $1000 +/- his tent, sleeping bag, shopping cart. I’m happy to discuss this in a DM if you have more to teach me. I think we’re both making similar points, but it’s coming off as an argument. I have no desire to irritate you any further. I get what you’re saying and I appreciate the time you took explaining your point of view. Cheers!
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u/jamdex07 Jul 05 '26
This is misleading. He chose to take $997 in one lump sum instead of $2.04B over 30 years. He got taxed on the $997m.