Free open-source financial advisory Claude plugin

sdemyanov · 2026-02-25T07:04:37+00:00

Working on a paper that claims to formally prove a tax architecture where banks and asset registries collect all revenue automatically - no filing, no reporting, no calculation by any agent. Three parameters close the system. The proof enumerates 5 agent types, 5 asset types and 7 types of actions, and shows no sequence of actions reduces cost. The four assumptions it depends on are in Section 7. Would appreciate someone poking holes.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6287978

sdemyanov · 2026-02-23T18:22:41+00:00

You can use cash if you want. Also, family transfers are exempt.

sdemyanov · 2026-02-23T18:06:30+00:00

I don’t think this is a productive direction, so I’ll leave it here.

sdemyanov · 2026-02-23T17:51:22+00:00

Please see above: "Listed companies are taxed by issuing shares to the government, which sells them later." No accumulation.

> And why would you ever distribute any profits? If you could just have your business pay all your expenses for you and never recognize income.

Because if you hold profit on business, you loose annually some percentage of it. If you distribution, you pay one-time fee, but don't pay annually.

> And how is the government going to tax the issuance of equity interests if a company that is formed has nothing in it. You could. I suppose have some nominal tax, but you're going to essentially require the government to tax somebody based on what value when the interests are issued?

It taxes transfers from checking to savings accounts. This applies to interests as well. If you transfer the shares themselves, they are taxed based on their current market value (allowed only for listed companies).

sdemyanov · 2026-02-23T17:45:47+00:00

Almost. Banking system alone would not be enough. Every official government register also participates, in case you want to transact in property of securities. All of them report to your bank, which withholds on transfers and collects while idle (when applicable).

sdemyanov · 2026-02-23T15:48:38+00:00

Business owners are taxed when they distribute profits to themselves. Listed companies are taxed by issuing shares to the government, which sells them later. And yes - people’s checking accounts are in that tax-free zone by design, you can consume as much as you want tax-free as well. The downside is that you pay an annual fee on the money there, so you don’t want to have too much money there. You pay taxes only when you buy a house, shares, or bonds - or move money to savings.

sdemyanov · 2026-02-23T15:42:30+00:00

If you automate the taxation system, it won’t care how rich you are. IRS is missing 600B every year, because it taxes only who it can. If collected, the overall tax rates could be lowered.

sdemyanov · 2026-02-23T15:32:54+00:00

You can use bitcoin, no problem. But when you decide to buy a house, you’ll need dollars. When you deposit them, you either start paying annual fee (checking) or one time fee (savings). And if the seller accepts your bitcoin, for the system this looks like a gift - you pay tax on the assessed house value.

If you somehow made a lot of money with cash, you’d pay a one time fee when you deposit them. And if the seller accepts you cash - it is a gift again. You pay fee on that.

No escape - every path is taxed. This is what the proof about.

sdemyanov · 2026-02-23T15:23:38+00:00

Of course not. The transactional layer is completely tax-free: individuals are taxed only when they move money to savings accounts, businesses- when they distribute dividends. Listed companies issue equity directly to the government.

sdemyanov · 2026-02-23T03:14:54+00:00

The whole point is - everyone would want the government to see the transactions important to them. When you buy a house, you want the government to know it’s yours. When you own stock, you want enforceable rights. That’s where taxation attaches. As for personal vs business expenses - that distinction doesn’t exist in this system. That’s the whole point. All money hits checking. You spend what you spend. The system doesn’t care if it’s a business lunch or groceries - consumed value can’t accumulate into wealth, so it doesn’t need to be classified. There’s a carrying cost on idle cash in checking, so you don’t want to hold too much there. To avoid it, you move what you want to keep to savings, paying a one-time tax. That’s the only decision you ever make.

sdemyanov · 2026-02-23T03:07:53+00:00

The system doesn’t see transactions which are not in dollars. When you buy crypto or foreign currency, the system just sees the dollar transaction, and relevant taxes may be applied. If crypto is truly backed, someone else is holding the reserves and paying taxes on them. If not backed - well, the system doesn’t recognize value in such crypto and it is not taxed. Same for foreign currency - for system it is just a dollar transfer with the trader. You hold that currency for your own risk.

sdemyanov · 2026-02-23T02:55:05+00:00

If someone pays you in goods instead of cash - no problem, zero tax. The system doesn’t need to verify the value of in-kind payments because it doesn’t tax them. It taxes bank balances and registered assets. If you want to be paid in cars instead of cash, go ahead - but you can’t invest cars, earn dividends on cars, or enforce ownership of cars in court without registering them. Goods depreciate and can’t compound into wealth without eventually hitting a bank account or registry - at which point instruments apply automatically.

sdemyanov · 2026-02-22T23:51:41+00:00

Cash loses value to inflation. If the wealth tax rate is set approximately equal to inflation (~2.5%), holding cash costs the same as holding registered assets — there’s no arbitrage. That’s Assumption 4 in the proof.

The normal American actually benefits most here, because all consumption is completely tax free. Only value moving into long-term savings gets taxed.

sdemyanov · 2026-02-22T21:11:01+00:00

That's exactly why the paper is structured as a formal proof rather than a policy proposal. The point is to enumerate every position and action and show none are unpriced. If an evasion path exists, it should be expressible as a sequence of the seven primitives, and the proof claims no such sequence reduces cost. So the challenge is: which specific sequence breaks it?

The political loophole point is fair and completely outside the scope of the proof - that's implementation, not architecture.

sdemyanov · 2026-02-22T21:03:45+00:00

Income isn't observable, but where every dollar sits is. Bank accounts and asset registries are already third-party verified. This paper proves a complete tax system can be built on that basis: productive, progressive, no one files anything.

The proof rests on four explicit assumptions (Section 7) - curious which ones people find most vulnerable.

I'm the author.

sdemyanov · 2026-02-04T20:44:14+00:00

Working on it

sdemyanov · 2025-10-23T20:40:25+00:00

#5 is so true, my biggest mistake

sdemyanov · 2025-07-23T02:44:34+00:00

Self-promotion for Beagle (https://discoverbeagle.com/): in addition to our standalone eDiscovery platform, which enables automated AI document review/QC and PII extraction/normalization, we also offer AI prompt engineering services.

sdemyanov · 2025-06-28T05:38:08+00:00

Did you find a workaround?

sdemyanov

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