Dow tumbles 321 points on Biden's capital gains tax hike plan

[paintman]

I remember arguing with a lady back when Obama was running the first time. She is a very successful business owner with multiple daycares. I asked her why she would vote for someone that would raise taxes knowing it would affect her.
her response was that it would cause no problems for her, she would just raise her rates and pass it on. Therefore creating higher prices for the hardworking people trying to make a living.

 

[actaeon277]

I think what Yellen has proposed would work just the opposite. Her proposal is you would be taxed upon the difference between say the paper value of your account on December 31, [some year] and December 31, [some year - 1]

If the market tanked 35% just before it was implemented, and the tax applied to the steeper valuation increases of a recovery, it is a bonus situation for tax and spend

If the market tanks, so does your retirement account.
The fact you are going to pay less taxes does not detract from big losses.

 

[churchmouse]

If you voted for even just ONE demon-crat, you`re a traitor to the United States, AND a blithering idiot.

These douche nozzle suckers have zero ideas of why and how Trump kicked the economy into high gear.....He cut Taxes and ended Gov regulations that choke the economy. They have no ****ing idea unless they do and this is by design. To slow us down and cripple free enterprise. As munchers and knee pad users. I hate each and every one but to no avail.

 

[chocktaw2]

Lets take for instance, I'm a millionaire (which I'm not) but I hold stock in several companies that I got on the cheap many years ago. Am I going to keep that stock until later, and sell and have to pay 40+ percent capital gains? Or am I going to dump it now to only have to pay 20%? Once the dump begins, market will drop hugely.

You are correct. Gov. wants ALL the money?

 

[jsx1043]

We're still building back from covid and they want to announce this now, are they purposely trying to damage the economy even more?

Short answer? Yes.

The Great Reset

There is an urgent need for global stakeholders to cooperate in simultaneously managing the direct consequences of the COVID-19 crisis. To improve the state of the world, the World Economic Forum is starting The Great Reset initiative.

www.weforum.org

 

[jsx1043]

To put this into perspective:

Since we went off the gold standard, all cash is fiat - basically worthless, aside from the value that the people give it.

The response to the Great Financial Crisis in 2008 was to print just shy of $700 billion dollars to keep the worldwide financial system from crashing. We collectively balked at this but said, "whatever."

The answer to the 2020 pandemic was to print over $12 TRILLION dollars, and the money printers still "go brrrrr" as we speak and nobody bats an eye. The Federal government even goes so far as to add $1.9T for "Coronavirus Relief" and proposes $2T in infrastructure, adding to the federal deficit.


If cash is worthless and we can "spend" our way out of all these problems, then why do we pay taxes? The government obviously doesn't need it, they just print what they want.

 

[churchmouse]

To put this into perspective:

Since we went off the gold standard, all cash is fiat - basically worthless, aside from the value that the people give it.

The response to the Great Financial Crisis in 2008 was to print just shy of $700 billion dollars to keep the worldwide financial system from crashing. We collectively balked at this but said, "whatever."

The answer to the 2020 pandemic was to print over $12 TRILLION dollars, and the money printers still "go brrrrr" as we speak and nobody bats an eye. The Federal government even goes so far as to add $1.9T for "Coronavirus Relief" and proposes $2T in infrastructure, adding to the federal deficit.


If cash is worthless and we can "spend" our way out of all these problems, then why do we pay taxes? The government obviously doesn't need it, they just print what they want.

It is a form of control.

 

[KittySlayer]

Leadeye and Smitty

Generally selling your personal residence is not a taxable event. But of course they can always change the laws but this is a long established rule.

But of course there is always the unexpected. You have to go to a nursing home. The real estate market is in a slump so you decide you will wait it out for a couple years. While waiting for the market to rebound you rent it out. Suddenly you have converted your personal residence (non-taxable) into an investment rental property which would be taxable when sold a few years later.

 

[gregkl]

Leadeye and Smitty

Generally selling your personal residence is not a taxable event. But of course they can always change the laws but this is a long established rule.

But of course there is always the unexpected. You have to go to a nursing home. The real estate market is in a slump so you decide you will wait it out for a couple years. While waiting for the market to rebound you rent it out. Suddenly you have converted your personal residence (non-taxable) into an investment rental property which would be taxable when sold a few years later.

kittyslayer, if I bought my home for say $200K, sell it for $400K and buy my final "retirement place" for $300K, what kind of tax liability will I receive? Will I pay capital gains? I thought at one time there was a one time capital gains exemption regarding a home.

 

[snorko]

I would imagine middle class retired people who say bought a home in the 60s for 20K that's now worth 300K aren't going to be happy about this. I'm not surprised these days when politicians say they are only going to tax the rich and so many middle class folks find out they meet the definition used to calculate the tax.

I'm not a tax lawyer so maybe there are ways around this.

Kittyslayer is right on in his following posts, but there is additional lurking danger. Right now if your parents bought a house for $20K and sell it for $300K, I believe there are no capital gains for a one time deal.

HOWEVER, they are also proposing how the cost basis is calculated. Say your folks do not sell and you inherit that house. Currently your inherited cost basis is the value as of the date of death or $300K. The Biden Admin. has proposed making the inherited cost basis that of the original owner or $20K. So you sell the house and you owe capital gains taxes on the $280K.

 

[KittySlayer]

kittyslayer, if I bought my home for say $200K, sell it for $400K and buy my final "retirement place" for $300K, what kind of tax liability will I receive? Will I pay capital gains? I thought at one time there was a one time capital gains exemption regarding a home.

You can exclude more than once. Basically think of the situation you become an adult(?) and buy your starter home. You sell it to buy another home at your new job location. Then you are settled in your career and upgrade to another home. Then buy your retirement home. Within the rules generally all sales would not be taxable.

Here is a quick and dirty link.

Topic no. 701, Sale of your home | Internal Revenue Service

Topic No. 701 Sale of Your Home

www.irs.gov

If you have a capital gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income, or up to $500,000 of that gain if you file a joint return with your spouse

 

[gregkl]

You can exclude more than once. Basically think of the situation you become an adult(?) and buy your starter home. You sell it to buy another home at your new job location. Then you are settled in your career and upgrade to another home. Then buy your retirement home. Within the rules generally all sales would not be taxable.

Here is a quick and dirty link.

Topic no. 701, Sale of your home | Internal Revenue Service

Topic No. 701 Sale of Your Home

www.irs.gov

Thanks. It appears I don't have to worry about it then. Part of our strategy is that when we sell this and move, we will buy a lower priced home and put the remainder in our retirement fund.

 

[Leadeye]

Wife's mom lives alone in a house on 60 acres of land that her and the wife's dad bought in the 60s. She's not going to be happy if Joe takes a third of the value away to send to his buddies in china.

In the end I don't know if it will make a difference, when she finally goes into assisted living or a nursing home medicaid will get the rest no matter what Joe leaves behind.

 

[gregkl]

Wife's mom lives alone in a house on 60 acres of land that her and the wife's dad bought in the 60s. She's not going to be happy if Joe takes a third of the value away to send to his buddies in china.

In the end I don't know if it will make a difference, when she finally goes into assisted living or a nursing home medicaid will get the rest no matter what Joe leaves behind.

I think for the nursing home, they will take whatever is leftover, but I don't think they will for assisted living. They don't take my mother's SS checks plus she gets a Medicaid waiver that significantly reduces here monthly rent. She actually has to be careful that her bank account doesn't grow too much or she will become ineligible. I guess she is caught between being totally destitute and having enough to live on her own without .gov aid.

My side of the family tends to die penniless. My wife's side(all still alive) has a lot of money. It is much more complicated on her side than ours. I'm not sure which is worse. I do know my mother wishes she had something to leave us. But I'm just grateful that at 93 years old, I have the opportunity to be with her.

 

[KittySlayer]

Wife's mom lives alone in a house on 60 acres of land that her and the wife's dad bought in the 60s. She's not going to be happy if Joe takes a third of the value away to send to his buddies in china.

In the end I don't know if it will make a difference, when she finally goes into assisted living or a nursing home medicaid will get the rest no matter what Joe leaves behind.

You really need to get together with a qualified Medicaid planner and do some planning to protect assets. You cannot wait until she needs to go to assisted living, it will be too late. Do it now while she is healthy otherwise everything she owns will be sucked dry. A small investment with exponential returns.

 

[roibroker]

We are parting with 140 acres for just this same reason.

If you have real estate, not your primary residence, and you elect to sell you can avoid capital gains by rolling over the property in a like kind new property. It's called a 1031 Exchage. You defer capital gains until some other time. You cannot take possession of the funds and you must use a Qualified Intermediary to close the transaction. You would have 45 days to identify up to 3 potential properties and a max of 180 days to close. Most commerical brokers and Title Companies can answer any questions

 

[DoggyDaddy]

If you have real estate, not your primary residence, and you elect to sell you can avoid capital gains by rolling over the property in a like kind new property. It's called a 1031 Exchage. You defer capital gains until some other time. You cannot take possession of the funds and you must use a Qualified Intermediary to close the transaction. You would have 45 days to identify up to 3 potential properties and a max of 180 days to close. Most commerical brokers and Title Companies can answer any questions

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[armalitesheepdog]

Those "RICH" People also employ alot of people. If they take a hit in one area they are gonna make it up in another.
Lower payroll. raise prices. Cut expenses. It all will trickle down to the poor people. Well the working poor anyway. The sponges will be ok. He will raise there benefits....So stupid.

 

[DoggyDaddy]

Those "RICH" People also employ alot of people. If they take a hit in one area they are gonna make it up in another.
Lower payroll. raise prices. Cut expenses. It all will trickle down to the poor people. Well the working poor anyway. The sponges will be ok. He will raise there benefits....So stupid.

Democrats/Socialists have never demonstrated that they have a working knowledge of how the real world works.

 

[Tombs]

To put this into perspective:

Since we went off the gold standard, all cash is fiat - basically worthless, aside from the value that the people give it.

The response to the Great Financial Crisis in 2008 was to print just shy of $700 billion dollars to keep the worldwide financial system from crashing. We collectively balked at this but said, "whatever."

The answer to the 2020 pandemic was to print over $12 TRILLION dollars, and the money printers still "go brrrrr" as we speak and nobody bats an eye. The Federal government even goes so far as to add $1.9T for "Coronavirus Relief" and proposes $2T in infrastructure, adding to the federal deficit.


If cash is worthless and we can "spend" our way out of all these problems, then why do we pay taxes? The government obviously doesn't need it, they just print what they want.

This is why at this point I say you might as well just do UBI, we're never recovering from this amount of debt.
The only potential hope is igniting such rabid consumerism that it keeps this rotting corpse limping on a little longer.