Posted on 08/21/2024 3:12:59 AM PDT by Kid Shelleen
In President Joe Biden’s proposal in the Fiscal Year 2025 Budget of the United States Government, and more specifically in the General Explanations of the Administration’s FY 2025 Revenue Proposals, the Biden administration has proposed a slate of bold shifts in tax policy that could redefine high income tax planning and investment strategies.
Among the most striking initiatives in the FY2025 Budget Proposal is a set of proposals taxing unrealized gains—a concept ---SNIP-- . A shift in tax policy towards tapping revenue streams in unrealized gains is almost certainly on the horizon-
(Excerpt) Read more at forbes.com ...
Example of unrealized gain:
A store’s increased floor traffic, because of an advertisement.
They would be forced to sell the asset to pay the tax on the unrealized gains. How’s that work for the underlying business?
Beyond that, lots of assets are difficult to value. There are tons of closely held companies out there without an active stock market. What are they worth? What some IRS DEI hire says they are?
You buy 10 shares of "X Stock" at $50 a share for a total investment of $500.
The price of that stock shoots up to $100 by the next year and so your investment is now worth $1,000.
You are now taxed 25% on that $500 "unrealized gain" ($125).
Now let's say that stock plummets and you decide to cut bait when the stock hits $40 a share. Now you are down $100 on your initial investment but you just paid $125 in taxes on that phantom gain so your real loss is now $225.
This in a nutshell is what they mean by taxing unrealized gains.
I ran into a similar issue with SAR’s from a previous employer. They would vest and I had to pay tax on the entire lot as ordinary income. Then, the share price would drop and I would be underwater.
Dems would never sneak in a loophole for themselves on the 10,000th page, while screaming they have to pass this bill NOW, trust us, nobody ever reads ALL the pages!
The government is not interested in participating in those.
If ole Kamala-la-la is elected, we will see a SEA of destruction that the world has never known, and it will be the destruction of the US Constitution and all we have because of it. We will look and be like Venezuela and be run like North Korea. Or this country will be destroyed by civil wars all around the land.
Thanks.
“Unrealized gains taxation could be the most destructive idea for our country since prohibition, I joked at the time.”
Prohibition would be small potatoes by comparison. Nor am I sure that the Smoot-Hawley tariff was as bad.
It would be a never ending accounting nightmare to track asset growth or shrinkage on a tax year basis - assets are constantly rising and falling in value from one day to the next. On what day is the valuation to be made? Keeping track of this valuation date from one year to the next on assets that are not liquidated will only make your tax accountant rich and happy.
much easier than tracking individual investments. I suspect the investment companies are lobbying for this.
I suppose it depends.
Let’s say you decide to sell it all, and you put 10k in your S&P fund long ago and now it’s grown to 100k. Now you owe 44.6% of 90k on it, which means you cash out with roughly $60k.
Now let’s say you don’t want to sell it all, just enough to be able to pay the $4,205 tax bill on unrealized gains. 90% of the value at sale will be taxed at 44.6%. How much do you need to sell to keep the $4,205? Rinse and repeat every year. Oh my.
Kraft durch Freude!
Unconstitutional. This form of taxation is now allowed.
“ The sooner Trump gets in the better we’re all be.”
True. Trump would be a respite.
But the largest political party in America is a Stalinist/Islamo-fascist party. One slip up, one lost election, one successful wag-the-dog, one more pandemic is all it will take to bring a Stalinist/Islamo-fascist dark age down on America.
In the long-term, no good can come from this.
“ARTICLE XVI. The Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”
That amendment to the constitution allowes congress to tax incomes, in addition to other taxes that were already in effect. Congress has no power to tax unrealized (meaning no income) appreciation in assets.
If only. Prepare yourself for the colombian connection juan mecham to post a series of pictures of Trump in orange prison garb with handcuffs and manacles. Wait for it. he will do it no matter what. It is his “contribution”. What is to stop him?
Dad used to have a cartoon on his desk of two bears pictures in the sights of a rifle with one pointing at the other. People are like that until they come for the Jew that is your neighbor.
I buy 1000 ashtrays at 1 dollar cents each.
I will sell them at 10 dollars each, yielding 9 dollars per ashtray as profit.
According to this proposal, I’d need to pay taxes on the 9000 dollars immediately.
No even Value Added tax is this bad.
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