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At least 26 Fortune 500 companies including GE and Duke Energy paid no U.S. federal income taxes...

At least 26 Fortune 500 companies including GE and Duke Energy paid no U.S. federal income taxes during 2008-11, in part because of the break for accelerated depreciation, according to Citizens for Tax Justice. “These big, profitable corporations are continuing to shift their tax burden onto average Americans,” says the group's director. “This isn’t fair to the rest of us."
Comments (20)
  • lpcongas99
    , contributor
    Comments (129) | Send Message
     
    if they were creating jobs in america, it would not bother me.
    9 Apr 2012, 05:48 PM Reply Like
  • clydewilliford
    , contributor
    Comments (16) | Send Message
     
    I agree, create more job's here. Still, with all the bull they want you too believe! GE still advertising about creating job here, what a lie. For evey job here they create 1000 out of the country. The head of GE is head of the Presidents counsel on job creation? what f'n insult to American tax payers.
    9 Apr 2012, 06:03 PM Reply Like
  • The Patriot
    , contributor
    Comments (323) | Send Message
     
    It just highlights what a complete mess the tax code is.
    9 Apr 2012, 06:12 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3529) | Send Message
     
    The rationale behind the accelerated depreciation was the increased writeoff would encourage additional capital investment both through a faster return of the investment and encouraging more investment by lowering the breakeven point for riskier investments. Did it work? A study of whether the goals were met would be better than just crying 'unfair, unfair'. What bothers me is how these companies avoided the alternative minimum tax. The democrats assured us that would bring tax fairness when they passed it. I guess they put a few clauses in it so their friends wouldn't be hit.
    9 Apr 2012, 06:15 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3080) | Send Message
     
    Many of these companies are sitting on even larger cash piles. Of course they might argue that continued uncertainty requires them to hold onto cash in the event that the economy deteriorates further.

     

    Tax "fairness" would seem to me to be a system with a flat rate for all corporations, and no deductions. Instead the power of lobbying allows some companies to get breaks that other companies cannot use, which many will claim makes them more competitive. If other countries subsidize certain industries, then the argument is that the US must do the same to remain competitive. I've heard the arguments numerous times, but it doesn't seem to me that the current system has been that effective.
    9 Apr 2012, 06:32 PM Reply Like
  • J 457
    , contributor
    Comments (951) | Send Message
     
    Flat tax is the best solution. Eliminate the loop holes and offer more incentive to companies that bring jobs home to the USA.
    9 Apr 2012, 08:15 PM Reply Like
  • Tack
    , contributor
    Comments (12958) | Send Message
     
    More capitalism bashing for the ill informed and envious. I wonder who has the world's highest tax rates?

     

    http://yhoo.it/Iof5EL

     

    It never occurs to those that wish to criticize business that when you tax them to death and force them to pay mimimum wages not set by the market and force them to provide every kind of healthcare benefit and other entitlement that, perhaps, those companies might choose to invest, expand and employ elsewhere.

     

    But, thank God we have Government, and those that worship it, to save us, protect us and take care of us. They do such a splendid and efficient job.
    9 Apr 2012, 06:22 PM Reply Like
  • Topcat
    , contributor
    Comments (416) | Send Message
     
    Er, you forgot to mention this part of your linked story...

     

    "In fact, the United States collects less corporate tax relative to the overall economy than almost any other country in the world."

     

    http://cnnmon.ie/HtwZ8R
    9 Apr 2012, 06:36 PM Reply Like
  • J 457
    , contributor
    Comments (951) | Send Message
     
    Tack. That's the problem with you boomers, you've left this rotting legacy that permeates of always wanting something for nothing. Wake up call- you can't smother yourself with the red carpet entitlement treatment without first paying for it. Heaven knows your children and their children will be paying for decades to come.

     

    Capitalism died when we handed GE their bail-out in 2009. Defend them if you will, but these corporations should not only be taxed, but many should have been nationalized and then shut down.
    9 Apr 2012, 08:11 PM Reply Like
  • Tack
    , contributor
    Comments (12958) | Send Message
     
    j457:

     

    Speak for yourself, not me. I have no inheritance, no guaranteed entitlements, no pension, no squat. I built my present comfortable lifetsyle entirely on hard work, careful planning, avoidance of capricious spending and excess debt, and sage investing, and I don't owe it to you or anybody else for that matter.

     

    Go make your own money, and stop whining.
    9 Apr 2012, 08:20 PM Reply Like
  • J 457
    , contributor
    Comments (951) | Send Message
     
    You must be the only boomer to make such claim? Great work! Now, back to that 16 trillion debt.....
    10 Apr 2012, 01:55 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Not that I don't trust a firm named "Citizens for Tax Justice", but I decided to look at their report, and then in 5 minutes decided to look at one of their companies. I picked Duke Energy, for no particular reason, except I considered them a potentially "capital intensive" company and figured they may have had some heavy depreciation write-off's.

     

    Now the CTJ report says Duke had a negative effective tax rate for 2008 to 2011.

     

    So here is the information from the Duke Energy financial statements:

     

    " Year Ended December 31, 2011 as Compared to December 31, 2010. For 2011, consolidated income tax expense from continuing operations decreased $138 million compared to 2010, primarily due to a decrease in the effective tax rate. The effective tax rate for the year ended December 31, 2011 was 30.5% compared to 40.3% for the year ended December 31, 2010. The change in the effective tax rate is primarily due to a $500 million impairment of non-deductible goodwill in 2010.

     

    Year Ended December 31, 2010 as Compared to December 31, 2009. For 2010, consolidated income tax expense from continuing operations increased $132 million compared to 2009, primarily due to the increase in pre-tax income. The effective tax rate for the year ended December 31, 2010 was 40% compared to 41% for the year ended December 31, 2009. The effective tax rates for both 2010 and 2009 reflect the effect of goodwill impairments, which are non-deductible for tax purposes."

     

    Duke Energy paid the following federal taxes on income for the 4 years from 2008 to 2011:
    2008 - $616 million
    2009 - $758 million
    2010 - $890 million
    2011 - $752 million

     

    For the 4 years, they made cumulative $8.397 billion and paid $3.016 billion for an effective tax rate of 35.9%.

     

    So what am I to conclude about CTJ?
    9 Apr 2012, 06:25 PM Reply Like
  • J 457
    , contributor
    Comments (951) | Send Message
     
    Did they really pay that amount? Or was that amount then adjusted down to virtually nothing after the tax accountants worked the numbers?
    9 Apr 2012, 08:14 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    That thas the tax liability on their income. It does not consider the affect of any prior year tax credits that may have reduced the amount actually paid. Although you can see for the 4 years listed, there were no losses that would have generated a carryforward.
    10 Apr 2012, 09:37 AM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Just so you know, I also sent the CTJ guys an email with my post above included. I asked them to respond.
    9 Apr 2012, 06:31 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    I would be happy for anyone interested to pick one of the other companies on their report list and examine their data to see what that actual results were. Perhaps I mis-understood, or perhaps this is just a Duke fluke.
    9 Apr 2012, 06:35 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    Oh, I could contain myself....I went back to look at their list and noticed alot of power/energy companies, so I decided to check another. American Electric Power.

     

    For the last 3 years, AEP has paid $2.036 billion in income taxes on $6.154 billion in net income before taxes for an effective tax rate of 33.1%.
    9 Apr 2012, 06:42 PM Reply Like
  • DianeLee
    , contributor
    Comments (352) | Send Message
     
    Thanks for injecting your dose of reality, WMARKW. I keep reminding myself not to bother reading these bait-the-liberals columns, but your response of facts in answer to the rhetoric made this one worth while. Facts are always the best response to rhetoric, as the Left seizes on the tax RATE rather than actual taxes paid. Bravo.
    10 Apr 2012, 08:51 AM Reply Like
  • Hendershott
    , contributor
    Comments (1510) | Send Message
     
    With accelerated depreciation, taxes are reported but may not actually be paid. The taxes are deferred and may or may not be eventually paid. I case you don't know it, the IRS gets a different set of reports than the shareholders.
    9 Apr 2012, 07:30 PM Reply Like
  • WMARKW
    , contributor
    Comments (10275) | Send Message
     
    And regardles of any offsets on the tax books, the tax liability generated per the income statement is the place to start. If there were items that adjusted the tax liability, they would have come from things like accelerated depreciation, depreciation, prior year tax losses, special credits, etc. But every available credit $ would have to match against the income tax liability.
    10 Apr 2012, 09:41 AM Reply Like
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