To: Locomotive Breath
Actually the calculation might be something like this:
1. 10% of $400,000 to a bondsman or $40,000.
2. 6% forgone earnings on $400,000 or $24,000.
Now you might make even more than 6%. And if the return you are giving up on the money is greater or you borrowed on your second mortgage and are paying a higher interest rate than 6% and you compounded the interest daily, pretty quickly one could get to the $40,000 if the trial really takes a year or maybe more to happen and the bond is not reduced.
468 posted on
05/20/2006 9:41:54 AM PDT by
JLS
To: JLS; NeonKnight
Yeah, but if they paid in cash then they don't pay the 10% to the bail bondsman and that's a guarantee. Is that 10% tax deductible? And all the calculations on earnings don't include that tax that would be paid on those earnings which, if you can round up $400,000 on a moment's notice, then is probably going to be in the highest bracket. And the lost earnings also depend on how long the $400,000 is unavailable.
Look, I agree with everyone about the foregone earnings and/or interest if they had to borrow the money, I was just trying to figure out how the system works and the answer is that if you pay in cash then you get all your cash back.
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