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Why Democrats' Scheme to Tax Unrealized Capital Gains Should Terrify You
American Thinker.com ^ | October 27, 2021 | David Ennocenti

Posted on 10/27/2021 2:48:49 AM PDT by Kaslin

Our current secretary of the Treasury, Janet Yellen, is busy trying to find a way to tax wealth without calling it taxing wealth. She has eyes on taxing unrealized capital gains. What this means simply is taxing people for money they have not earned or received. That's it in a nutshell. That definition should leave even those who have never had a course in accounting or finance shaken.

Not only is Janet Yellen considering this, but the Democrat party is on board as well. Democrats claim that it is needed in order to pay for their agenda. You know — the one that President Biden says pays for itself. The idea of taxing you for the income you have not made is also a policy speaker of the House Nancy Pelosi proposes. Apparently, there is some confusion here.

Looking at this from my point of view, I recalled a picture of Casey Stengel, nicknamed "the ol' Professor," when he was the manager of the New York Mets in 1962 — a team considered the worst team to ever play in the major leagues. He had his hat off and scratched his head with the caption: "Can't anybody here play this game?"

Think about how absurd this idea is. Imagine if an Internal Revenue Agent showed up at your house and said, we decided that you have to pay tax on the money you never earned. Aside from how insane that sounds on the surface, one need only ask: "If I didn't receive or earn that money, with what do you expect me to pay the tax?" That, in a nutshell, is the entire problem.

(Excerpt) Read more at americanthinker.com ...


TOPICS: Business/Economy; Culture/Society; Editorial
KEYWORDS: capitalgains; wealthtax
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To: BobL
They can STEW in this tax and they can fight it. I’m sick of defending them. As to the middle class, we have FAR MORE near-term tax threats than a billionaires tax eventually drifting down to our brackets

Not trying to defend billionaires, just pointing out there will be a natural progression to then also tax millionaires.

Middle class has massive wealth of unrealized capital gains from housing to retirement accounts without the ability to move their wealth around that billionaires have. Billionaire Perot used to have his wealth in tax free municipal bonds which are exempt from federal and state income taxes.

21 posted on 10/27/2021 4:48:27 AM PDT by tlozo
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To: Kaslin
Good luck with getting that cost basis calculation, Fed. Unless they plan on setting a date and having purchases transmitted to the IRS from that date forward. In any case, this will be a market killer.
22 posted on 10/27/2021 4:57:09 AM PDT by liberalh8ter (The only difference between flash mob 'urban yutes' and U.S. politicians is the hoodies.)
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To: MattMusson

Eventually the Unrealized Capital Gains tax will force homeowners to pay capital gains tax on increases in their home values.


Didn’t the dems float the idea that homeowners who owned their homes outright should have to pay income tax on the ‘imputed’ rent they’d be paying if they were renting the home?


23 posted on 10/27/2021 5:03:16 AM PDT by hanamizu
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To: qwerty1234

Perfect for farmland grabs.


24 posted on 10/27/2021 5:10:36 AM PDT by 9YearLurker
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To: wita

That’s fine and dandy where you can just sell some shares from your account if you need cash to pay the tax.

But try that as a farmer already scraping by in debt, trying not to lose his or her land.


25 posted on 10/27/2021 5:12:54 AM PDT by 9YearLurker
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To: Kaslin

What about the present value of your home??? My husband built our home in 1985 and I mean literally: framed, sided, shingled, plumbed and put in electric himself. We used our savings and a $25 K mortgage @ 13 1/2% (still recovering from the Carter years) to pay for the materials. It is worth a couple of hundred thousand more than what we put into it then. We would be forced to sell it to pay the tax on its increase in value and have no place to live. What a plan!


26 posted on 10/27/2021 5:15:46 AM PDT by finnsheep
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To: Kaslin

terrify is a bit strong


27 posted on 10/27/2021 5:17:28 AM PDT by babble-on
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To: tlozo

“If the government goes after billionaires unrealized capital gains what will stop them from eventually going after the middle class and their unrealized capital gains?”

If tomorrow the government confiscated the wealth of the top 1000 Americans, it still would be less than 1% of the national debt.


28 posted on 10/27/2021 5:28:08 AM PDT by EQAndyBuzz (If you are vaccinated, you cannot get COVID from someone who is not vaccinated. Lighted up Karen!)
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To: wita

>>Regardless it is still a tax, and remember above you are not ever removing money from the fund.

Same is true of a savings account, at least back when they actually paid interest - wether you take it or not, you earned it - if you want tax-free growth use a retirement account.

Mutual funds incur capital gains because they are constantly buying and selling (and paying dividends) which are all taxable events, just because you didn’t spend the money, doesn’t mean you didn’t earn it.


29 posted on 10/27/2021 5:32:33 AM PDT by qwerty1234
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To: Kaslin
What this means simply is taxing people for money they have not earned or received.

Maybe they should try taxing people's unrealized income from unrealized jobs.

Those are the jobs people used to have, or tried to get but couldn't. The unrealized income is still "money they have not earned or received," except that it's from an unrealized job instead of an unrealized capital gain.

-PJ

30 posted on 10/27/2021 5:36:12 AM PDT by Political Junkie Too ( * LAAP = Left-wing Activist Agitprop Press (formerly known as the MSM))
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To: qwerty1234
Mutual funds incur capital gains because they are constantly buying and selling (and paying dividends) which are all taxable events, just because you didn’t spend the money, doesn’t mean you didn’t earn it.

The difference is Mutual funds distribute those gains. Unlike holding an individual equity long term.

31 posted on 10/27/2021 5:36:14 AM PDT by 1Old Pro (Let's make crime illegal again!)
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To: Kaslin

I do not understand the supposed difficulty here, not that I support it.
Every local authority already has a decades-old taxing system on the average American’s largest wealth item — their home.
It’s property tax — levied on your biggest single wad of wealth. Don’t pay it, and the gov’mt takes your home.
Just put all wealth in the same bucket; physical property (e.g., home), bank holdings, etc. Pass a wealth tax — the progressive shiteheads would love calling it that. Tax and seize until gov’mt owns all private property. One important step to installing a true communist system — something every progressive has always wanted.

Want to see what the end game is? Don’t bother with Cuba or Venezuela, they are pikers. NorthKorea.


32 posted on 10/27/2021 5:39:49 AM PDT by bobbo666 (Baizuo)
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To: Kaslin

My house is worth 3 times what I paid for it 15 years ago. I have not sold it and thus “have not” realized a capitol gain but the government would like me to pay about about 100,000 dollars on an “unrealized gains.”

This is simply theft.


33 posted on 10/27/2021 6:05:16 AM PDT by cpdiii (cane cutter, deckhand, roughneck, geologist, consultant, pilot instructor, pharmacist , retired now)
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To: Kaslin

It’s conditioning for a future wealth tax on everyone. At the end of every year in addition to getting W2s and 1099S you will get a net worth statements.


34 posted on 10/27/2021 6:14:24 AM PDT by Kid Shelleen (Beat your plowshares into swords. Let the weak say I am strong)
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To: wita

Get a new accountant...that is wrong, you never pay taxes until you actually sell the asset...


35 posted on 10/27/2021 6:15:48 AM PDT by Wpin ("I Have Sworn Upon the Altar of God eternal hostility against every form of tyranny...")
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To: Kaslin

What tax rate are they proposing? Anyone know?


36 posted on 10/27/2021 6:17:01 AM PDT by Wpin ("I Have Sworn Upon the Altar of God eternal hostility against every form of tyranny...")
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To: tlozo

It is like a death tax without having to go cold.


37 posted on 10/27/2021 6:42:04 AM PDT by Nateman (If the Left is not screaming , you are doing it wrong.)
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To: wita
but if your account grows by 30,000 thousand dollars, you owe tax on it at the end of the year on top of all your other taxes.

Ummm, no. That's not how it works in a taxable mutual fund. You're not taxed on the growth, but on the proceeds (capital gains) that were generated during the fund year by the selling of stocks internal to the fund. You have the option of taking the proceeds in a payout or being reinvested into the fund. That's different than holding an asset that appreciates and doesn't generate proceeds that can be taken.

38 posted on 10/27/2021 7:49:01 AM PDT by damper99
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To: Kaslin

bmp


39 posted on 10/27/2021 8:32:14 AM PDT by gattaca ("Government's first duty is to protect the people, not run their lives." Ronald Reagan)
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To: 9YearLurker

I agree, your assets are encumbered, to feed us. Government is not your or our friend.

You will admit that selling shares to pay taxes, is equally responsible for screwing the investor whether farmer with equipment loans and cash poor. It is government taking what doesn’t belong to it, but take it they will.


40 posted on 10/27/2021 9:45:50 AM PDT by wita (Always and forever, under oath in defense of Life, Liberty and the pursuit of Happiness.)
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