Proposal for capital gains taxes

[miketheidiot]

Originally posted by: spidey07

Originally posted by: miketheidiot

Originally posted by: spidey07
lol, that's about how it is today. 15% on gains over a year (asset held longer than a year), short term is your normal rate (taxed as regular income).

The best solution is ZERO capital gains tax. It should never be taxed to begin with. That would spur more capital investment because there isn't the tax penalty.

that would not not spur capital investment.


I'm not sure how that i didn't know that short term investments were taxed at income tax rates.

How could it not? You have 100,000 dollars to invest and a bunch of choices. One of those choices there is no tax on the gains, all others there are.

Which one would you choose?

Or how about dividend reinvestment plans where stock dividends are automatically used to purchase more of the same stock. Having zero tax on that = automatically more capital investment.

buying stock =/= capital investment. Most stock that you buy on the market is just stock that was owned by another individual, adding nothing to the capital base. Furthermore thee is already too much investment capital floating around, and there really haven't been any good places to invest it in for a while.

 

[JS80]

It should be 0% capital gains for non-hedge funds and non-professional traders, and 39% for hedge funds and traders.

80% capital gains on PROFITS from oil futures trading going LONG
0% capital gains on PROFITS from oil futures trading going SHORT

 

[JS80]

Originally posted by: miketheidiot

Originally posted by: spidey07

Originally posted by: miketheidiot

Originally posted by: spidey07
lol, that's about how it is today. 15% on gains over a year (asset held longer than a year), short term is your normal rate (taxed as regular income).

The best solution is ZERO capital gains tax. It should never be taxed to begin with. That would spur more capital investment because there isn't the tax penalty.

that would not not spur capital investment.


I'm not sure how that i didn't know that short term investments were taxed at income tax rates.

How could it not? You have 100,000 dollars to invest and a bunch of choices. One of those choices there is no tax on the gains, all others there are.

Which one would you choose?

Or how about dividend reinvestment plans where stock dividends are automatically used to purchase more of the same stock. Having zero tax on that = automatically more capital investment.

buying stock =/= investment.

miketheidiot = fail

 

[miketheidiot]

Originally posted by: JS80

Originally posted by: miketheidiot

Originally posted by: spidey07

Originally posted by: miketheidiot

Originally posted by: spidey07
lol, that's about how it is today. 15% on gains over a year (asset held longer than a year), short term is your normal rate (taxed as regular income).

The best solution is ZERO capital gains tax. It should never be taxed to begin with. That would spur more capital investment because there isn't the tax penalty.

that would not not spur capital investment.


I'm not sure how that i didn't know that short term investments were taxed at income tax rates.

How could it not? You have 100,000 dollars to invest and a bunch of choices. One of those choices there is no tax on the gains, all others there are.

Which one would you choose?

Or how about dividend reinvestment plans where stock dividends are automatically used to purchase more of the same stock. Having zero tax on that = automatically more capital investment.

buying stock =/= investment.

miketheidiot = fail

read the update and tall me i'm wrong moron.

 

[winnar111]

Originally posted by: ironwing
Simply treat capital gains like any other income. Tax it at the going rate for the particular tax bracket the taxpayer falls into. Quit subsidizing the present investor class at the expense of future taxpayers.

The so called 'investor class' is still paying a higher tax rather than the bottom 50%.

 

[IronWing]

Originally posted by: winnar111

Originally posted by: ironwing
Simply treat capital gains like any other income. Tax it at the going rate for the particular tax bracket the taxpayer falls into. Quit subsidizing the present investor class at the expense of future taxpayers.

The so called 'investor class' is still paying a higher tax rather than the bottom 50%.

Likely not a higher rate when payroll taxes are factored in. I often wonder if folks who support taxing capital gains at a lower rate than earned income understand that the capital gains in their 401k accounts will get taxed as regular income, not as capital gains.

 

[NoShangriLa]

Correct me if I'm wrong, because my understanding of American capital gains tax is as follow (slightly similar to Canadian capital gains tax).

Current tax scheme:

>= 25% income tax bracket pay 15% long term capital gains tax.
= < 15% income tax bracket pay 5% long term capital gains tax.

Short term capital gain tax = income tax % bracket.

Dividend is 'tax relief credit' of 15% that can apply against capital gains.

If there is any changes in capital gains scheme most people would rebalanced their portfolio to take advantage of the tax law. It is not thing to lose sleep over for the average investor.

The biggest affect of capital gains tax is on asset sales therefore it going to affect the house flippers and short term/hedge fund/day traders more than the average person.

 

[spidey07]

NoShangriLa - see the link posted daishi5. You're real close.

It affects the average person trying to build wealth a lot more than you think. It's the principle of higher capital gains taxes as a whole that I severely disagree with. Also, ironwing nobody is talking about 401k here, we're talking capital gains tax.

 

[miketheidiot]

Originally posted by: spidey07
NoShangriLa - see the link posted daishi5. You're real close.

It affects the average person trying to build wealth a lot more than you think. It's the principle of higher capital gains taxes as a whole that I severely disagree with. Also, ironwing nobody is talking about 401k here, we're talking capital gains tax.

average people experience lots of capital gains c/d?

 

[spidey07]

Originally posted by: miketheidiot

Originally posted by: spidey07
NoShangriLa - see the link posted daishi5. You're real close.

It affects the average person trying to build wealth a lot more than you think. It's the principle of higher capital gains taxes as a whole that I severely disagree with. Also, ironwing nobody is talking about 401k here, we're talking capital gains tax.

average people experience lots of capital gains c/d?

Average people trying to build wealth, yes.

 

[NoShangriLa]

Originally posted by: spidey07

Originally posted by: miketheidiot

Originally posted by: spidey07
NoShangriLa - see the link posted daishi5. You're real close.

It affects the average person trying to build wealth a lot more than you think. It's the principle of higher capital gains taxes as a whole that I severely disagree with. Also, ironwing nobody is talking about 401k here, we're talking capital gains tax.

average people experience lots of capital gains c/d?

Average people trying to build wealth, yes.

Here in Canada long term CGT is on a sliding scale from 20.6% to 43.7% of 1/2 of the realized gains, and short term CGT = income tax.

Therefore most people balance their portfolio with dividend to avoid paying taxes.

 

[charrison]

Yes lets get serious about taxes and tax rates. Let set capital gains tax rate so that we collect the optimal amount of revenue from that tax. So far the current 15% cap gains tax rate has been collecting significantly more revenue than when the rate higher.


If cap gains taxes are raised above the current, we can expect to collect less revenue.

If you can realize this, we can talk and work a better system. for all taxes.

 

[piasabird]

So if you are going to increase the capital gains taxes, how about capitol losses?

 

[TallBill]

This thread is painful. There are so many bad posts that it's hard to pick out the good ones. I expect Obama to raise the LT tax to 20%

 

[ebaycj]

Originally posted by: charrison
Yes lets get serious about taxes and tax rates. Let set capital gains tax rate so that we collect the optimal amount of revenue from that tax. So far the current 15% cap gains tax rate has been collecting significantly more revenue than when the rate higher.


If cap gains taxes are raised above the current, we can expect to collect less revenue.

If you can realize this, we can talk and work a better system. for all taxes.

Well, since we don't really have post-recent-market-crash numbers (last year is all we have to go with), I'm gonna guess that the dow being 13000-14000 (mid-late 2007) vs. being around 8600 (may 2003) might have something to do with the increased revenue.

CG-Tax Revenue is measured in absolute dollars, so if the number of dollars in the market increases, it makes sense that the number of dollars recieved by the gov't in CG-Tax revenue would increase too.

Just because revenue increases does NOT mean that lowering the CG-Tax had anything to do with it. Correlation is not causation.

 

[charrison]

Originally posted by: ebaycj

Originally posted by: charrison
Yes lets get serious about taxes and tax rates. Let set capital gains tax rate so that we collect the optimal amount of revenue from that tax. So far the current 15% cap gains tax rate has been collecting significantly more revenue than when the rate higher.


If cap gains taxes are raised above the current, we can expect to collect less revenue.

If you can realize this, we can talk and work a better system. for all taxes.

Well, since we don't really have post-recent-market-crash numbers (last year is all we have to go with), I'm gonna guess that the dow being 13000-14000 (mid-late 2007) vs. being around 8600 (may 2003) might have something to do with the increased revenue.

CG-Tax Revenue is measured in absolute dollars, so if the number of dollars in the market increases, it makes sense that the number of dollars recieved by the gov't in CG-Tax revenue would increase too.

Just because revenue increases does NOT mean that lowering the CG-Tax had anything to do with it. Correlation is not causation.

You should take a look at the numbers, the jump in revenue is far than can contributed to inflation for market growth. Simply put, lower cp gains keeps money monving, whicn is it is taxes rather than held.

 

[winnar111]

Originally posted by: ironwing

Originally posted by: winnar111

Originally posted by: ironwing
Simply treat capital gains like any other income. Tax it at the going rate for the particular tax bracket the taxpayer falls into. Quit subsidizing the present investor class at the expense of future taxpayers.

The so called 'investor class' is still paying a higher tax rather than the bottom 50%.

Likely not a higher rate when payroll taxes are factored in. I often wonder if folks who support taxing capital gains at a lower rate than earned income understand that the capital gains in their 401k accounts will get taxed as regular income, not as capital gains.

Payroll taxes aren't taxes....they're fees for a future service. And even this isn't true once WOTC was passed, ignoring the onslaught of Obama handouts.

And 401ks don't pay taxes on gains at all. You pay taxes on income withdrawls because that money was put in tax free. It's a HUGE advantage.

 

[Xavier434]

Can someone provide historical public records (not biased news articles and website postings) which prove one way or the other about the effects of investments and capital gains taxes? I always see tons of people blowing smoke about their theories, but I never see any historical proof at all.

 

[JS80]

It's also unfair that real estate investors NEVER have to pay capital gains tax because of the 1031 rule. And many real estate investments don't even pay income tax.