Comments on: Paine and The Painful Brother Hitchens

By: Max Bleiweiss

Max Bleiweiss — Thu, 26 Apr 2007 18:01:34 +0000

I’m afraid I’m going to sound like an elitist but I also believe people should not be allowed to vote unless they are able to pass a test on how our government and economy work (or supposed to work) It annoys me to no end to see uneducated people rounded up, put on buses and hauled off to the local polls to vote for some socialist who is promising them freebies.

[A desired state-of-affairs, but not to be enforced by law. Property is the key.]

By: Dan Maguire

Dan Maguire — Thu, 26 Apr 2007 13:56:49 +0000

Eric, thanks for the information. I wasn’t aware of those facts.

I know we’re getting far afield of the original blog, but I’m curious and intrigued by this possibility. I’ll have to do more research on it. I find it hard to believe that a self-employed lawyer or doctor would be able to incorporate and change his wages to profits as a pure definitional change. Seems to me that Uncle Sam would crush that loophole pretty quickly if too many people tried it.

Finally, even if your salary remains unchanged after incorporation, that itself would be an automatic 6.5% raise. It does not necessarily follow that your employer would also give back his extra 6.5% to you. In fact, given that you’re already working at the lower wage, I suspect that in many cases the extra 6.5% of the employer’s dough would go to the employer and, ultimately, the consumer of whatever product it is you’re producing.

Social security…what a HUGE cost of production. An additional 12% beyond the labor costs associated with producing a product. How many jobs are being killed by this ravenous beast?

Kudos to those who are self-employed for both having a skill that they can use to their own benefit and for the potential to escape this trap.

By: Eric Zucker

Eric Zucker — Thu, 26 Apr 2007 06:57:45 +0000

I forgot to mention that your employer should be willing to pay you at least 6-1/2% more as a subcontractor since he will no longer have to contribute his share of your old Social Security payment. He also won’t have to make payments for other benefits so your raise may be even more substantial and you can decide how you want to spend that benefit money.

By: Eric Zucker

Eric Zucker — Thu, 26 Apr 2007 06:49:34 +0000

There is a way at least for the self employed to opt out of paying Social Security and it is quite simple. Incorporate and don’t pay yourself a salary. Instead pay yourself out of the corporate account and label the checks “profit distribution”. There is no Social Security on profit distribution only on wages. You’ll still owe income tax on the checks after your deductions but not Social Security.

Small business corporate owners do this all the time. I know lots of them. Many lawyers do it.

If your employer will allow you to change your relationship so that you are a subcontractor you can then incorporate and do it too.

By: Pam Maltzman

Pam Maltzman — Wed, 25 Apr 2007 23:23:39 +0000

Actually, I think there are or were a few groups of people who are or were able to opt out of Social Security. I thought I read that congresscritters were able to do that (well, they have lavish pensions anyhow). Also read that some group of public employees in Texas or somewhere was able to do that, and they had a very lavish pension system also that was not part of social security. Not sure of any more details, and of course the loopholes were closed at some point for the rest of us.

By: james huggins

james huggins — Wed, 25 Apr 2007 18:53:36 +0000

Only taxpayers vote? I have often stolen the quote, can’t remember the source, “Then one robs Peter to pay Paul, he will always have Paul’s vote.” If the Pauls of the nation can’t vote we will see the politicians getting hernias trying to get people off wellfare.

By: Dan Maguire

Dan Maguire — Wed, 25 Apr 2007 14:10:41 +0000

One cannot legally opt out of paying into Social Security. I do not know if one can voluntarily opt out of receiving benefits. Seems to me that Uncle Sam would let a chap opt out of the receiving end if that’s what he wanted.

I’m in my late ’30’s. I am not factoring SS into any retirement plans. That’ll be gut-check time. I oppose the unconstitutional beast, but I am not so sure that I’m principled enough to decline any $ that may come my way when I’m a geezer.

Of course, it is doubtful that the program will exist in its present form by then. It is likely that the dollar will be a little b**ch by then as well.

In absence of killing the program, which would be best, I’d say raise the minimum collection age to at least 70 immediately. Needless to say, I’m not running for president.

Only tax-payers vote….I like that idea! Ilana Mercer for president.

By: Franklin Hill

Franklin Hill — Wed, 25 Apr 2007 02:03:49 +0000

"I believe taxpayers alone ought to have the vote. Not tax consumers." I completely agree with you on that... and since I accept Social Security, that includes me.

[I'm no expert on Social Security, but it is my understanding that you cannot opt out from the plan. So, from the fact that a worker is forced to contribute to SS, it doesn't necessarily follow that he, overall, consumes more tax money than he contributes.]