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View Poll Results: What type of Taxes do you pay.
Most of our assets are in Tax Deferred Accounts (Including Roth Accounts) - We mostly pay income tax 47 51.65%
Most of our assets are in Taxable Accounts - We mostly pay capital gains 13 14.29%
Our assets are about evenly split Tax Defer/Taxable - Most of our income is derived from sources that generate Income Tax (Including Roth Accounts) 20 21.98%
Our assets are about evenly split Tax Defer/Taxable - Most of our income is derived from sources that generate capital gains 6 6.59%
Our Income mainly derived from taxable accounts that generate capital gains (we pay little income tax) 5 5.49%
Voters: 91. You may not vote on this poll

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Old 11-08-2008, 01:35 AM   #21
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I voted for the first option since I am young(26) and working and do not yet have substantial assets. I would imagine that the other options only become viable as you near retirement and begin withdrawing money for support.
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Old 11-08-2008, 05:01 AM   #22
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Originally Posted by whitestick View Post
You would need to have an addendum to the poll to make such an assumption. I'm retired and pay Short Term Capital Gains tax, equivalent to income tax rates, and have pension income and soon to be SS, all of which will be subject to the income tax rates, not capital gains. Others on here may be similar, IMHO, as I recall from previous polls.
Your last statement regarding the higher then average middle income class American, since Obama has implied that reaches to $250k per year, may or may not apply.

Yes it is a complicated topic. The simple poll mechanism in the forum does not lend itself to a complex poll. Of course, I am not going to spend the time to create a complex survey. That is where comments on the thread occur.


What the poll was about in simple terms... do you really benefit from the lower LT cap gains on securities. It has been much ballyhooed. It has not benefited me in any meaningful way. When I ER, I will spend taxable assets and it might then... but so far it has not.
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Old 11-08-2008, 02:42 PM   #23
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What the poll was about in simple terms... do you really benefit from the lower LT cap gains on securities. It has been much ballyhooed. It has not benefited me in any meaningful way. When I ER, I will spend taxable assets and it might then... but so far it has not.
Well, in that case, yes, I would benefit quite a bit from lower capital gains taxes over the next 2-5 years. After that cap gains should be a very small part, but until then it would help a lot in my case.
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Old 11-09-2008, 04:21 AM   #24
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Looks like 75% have not really benefited from lower cap gains.

Based on the numbers I have seen for people that work in America and save... that probably means a very very small part of the middle class could have benefited from those tax breaks.
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Old 11-09-2008, 08:11 AM   #25
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Based on the numbers I have seen for people that work in America and save... that probably means a very very small part of the middle class could have benefited from those tax breaks.
I think the key word in the above sentence is work. For retired folks without pensions, the lower tax rates on dividends and capital gains can be very significant. For example, a middle-class couple filing a joint return with taxable income of 65K which is all dividends and long-term capital gains have zero Federal tax liability in 2008.
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Old 11-09-2008, 08:58 AM   #26
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Originally Posted by FIRE'd@51 View Post
I think the key word in the above sentence is work. For retired folks without pensions, the lower tax rates on dividends and capital gains can be very significant. For example, a middle-class couple filing a joint return with taxable income of 65K which is all dividends and long-term capital gains have zero Federal tax liability in 2008.
My entire point is that most people do not have assets that generate $ that produce LT cap gains... Most people that acquired their securities through working have their assets in tax deferred accounts.

It appears that most people have an income tax burden not a LT cap gains burden. When the current LT cap gains law sunsets... most middle class Americans will not notice.
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Old 11-09-2008, 11:14 AM   #27
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My entire point is that most people do not have assets that generate $ that produce LT cap gains... Most people that acquired their securities through working have their assets in tax deferred accounts.

It appears that most people have an income tax burden not a LT cap gains burden. When the current LT cap gains law sunsets... most middle class Americans will not notice.
And my point is this is an early-retirement forum. Most people who retire early without a pension have a fairly significant taxable portfolio. Otherwise they wouldn't be able to retire early.
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Old 11-09-2008, 11:42 AM   #28
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And my point is this is an early-retirement forum. Most people who retire early without a pension have a fairly significant taxable portfolio. Otherwise they wouldn't be able to retire early.
I don't think everyone here is retired or if they are retired... retired Early... or perhaps they have pensions and SS + 401k/IRAs.


Did you look at the poll?
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Old 11-09-2008, 11:54 AM   #29
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Did you look at the poll?
Yes, and IMO, the questions in the poll were very poorly stated and too ambiguous to draw any valid conclusions.
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Old 11-09-2008, 12:12 PM   #30
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Yes, and IMO, the questions in the poll were very poorly stated and too ambiguous to draw any valid conclusions.
Perhaps. It is not a scientific study. But I think it provides some insight.

I have some taxable accounts... about 40% of our wealth. But DW and I are not typical middle class Americans. Our earnings are higher than the norm.... even after DW ERd

I think more Americans would benefit from income tax reductions than LT Cap gains reductions.

Given a choice, lower income tax or lower LT cap gains, I would choose a lower income tax.


Of course, LT cap gains should be a bit reflective of the risk investors take.


It all comes down to how the tax pie is sliced. And I think we are in for some reslicing over the next few years.
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Old 11-09-2008, 01:33 PM   #31
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And my point is this is an early-retirement forum. Most people who retire early without a pension have a fairly significant taxable portfolio. Otherwise they wouldn't be able to retire early.
To be taxed on capital gains, you've got to have gains.

Alas, after this year, I don't think any changes in capital gains taxes for the next decade will have any effect on me. I'm going to be carrying forward booked losses for long, long time.

I doubt any changes will be made toward removing the ability to carry forward losses. That would have a chilling effect on starting new businesses as well as existing businesses that have a cyclic nature.
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