Cap Gains Taxes - What is Fair?

[donheff]

How many of us really know anything in this regard? Economists are all over the place on the topic with statistics to prove both that the current 15% is choking the engines of industry and that under previous 35% rates those same engines roared.

I'm trying to keep any appearance of partisan politics out of this, so let's just say 'some people'.

I do think that some people have suggested a wealth tax. That would capture unrealized gains. I'm not saying it is widespread approach, but I think it has been thrown out there.

-ERD50

I'm sure some people out there may propose a wealth tax on net worth but that is a completely marginal segment. Raising such fantasies amounts to a red herring. I would be accused by many of being a "yellow dog..." and yet I haven't seen any of my fellow travelers proposing anything like that.

 

[Hamlet]

Can you imagine the last few years for people with substantial assets?

What was your taxable income for 2009? -1 million

What was your taxable income for 2010? +1 million

Don't forget that capital loss carry-over or you're just screwed.

Terrible idea, IMO. For many people, this would force you to sell the asset in order to pay the "imputed" taxes. That might discourage investment altogether.

Would this also provide write-offs for unrealized capital losses?

 

[ziggy29]

I'm sure some people out there may propose a wealth tax on net worth but that is a completely marginal segment. Raising such fantasies amounts to a red herring. I would be accused by many of being a "yellow dog..." and yet I haven't seen any of my fellow travelers proposing anything like that.

I would expect to see net worth used in means testing for public benefits (particularly Social Security and Medicare) some day, but not directly taxed. I believe that would be unconstitutional and require an amendment anyway, just as the 16th Amendment did for income.

 

[donheff]

I'm sure nothing in life is new but I think Bartlett is wrong about the "typical" liberal view of income for income tax purposes. He says liberals define it as including all earned income and all capital gains, realized or not (i.e. including positive changes in net worth as income). But I don't remember hearing any liberals suggest taxing unrealized capital gains. Every CG proposal I have heard in decades involves realized CGs.

Including unrealized capital gains as taxable income is part of the Treasury study.

That is a big document. Feel free to digest the whole thing and point out where it indicates that the typical liberal would recommend taxing unrealized gains. Maybe it is in there in some historical reference to the Wobblies but I'm not digging for it. I did see the issue discussed on page 75 but the then (an now) current approach to CGs and the "model tax plan" presented would tax only realized CGs. Again, I don't know any of my fellow travelers who want to tax unrealized gains. After all, we effete liberal snobs are home owners.

 

[ERD50]

donheff, I'm not trying to argue with you about this, it's a small point, but your words are your words, I'll quote them directly (with emph):

... But I don't remember hearing any liberals suggest taxing unrealized capital gains. ...

Then I said:

I do think that some people have suggested a wealth tax.

I'm sure some people out there may propose a wealth tax on net worth but that is a completely marginal segment. ...

.... Feel free to digest the whole thing and point out where it indicates that the typical liberal would recommend taxing unrealized gains.

You are jumping from 'not any' to 'some might' to 'the typical' - you're a moving target! No big deal, just trying to clarify which comment I was addressing ('not any').


-ERD50

 

[RetireBy90]

I'm sure some people out there may propose a wealth tax on net worth but that is a completely marginal segment. Raising such fantasies amounts to a red herring. I would be accused by many of being a "yellow dog..." and yet I haven't seen any of my fellow travelers proposing anything like that.

Not sure about red or yellow, but does sound like Joe Biden and wealth redistribution. Not trying to be political but strange things have been proposed from all over the place.

 

[donheff]

donheff, I'm not trying to argue with you about this, it's a small point, but your words are your words, I'll quote them directly (with emph):



Then I said:

Not to argue with you, but then arguing anyway , It is too difficult to re-post all my posts but I think your are correct nitpicking the ones referenced above. You did say some.

But this quote:

Originally Posted by donheff
.... Feel free to digest the whole thing and point out where it indicates that the typical liberal would recommend taxing unrealized gains.

to which you responded

You are jumping from 'not any' to 'some might' to 'the typical' - you're a moving target! No big deal, just trying to clarify which comment I was addressing ('not any').


-ERD50

Was not directed at you. It was directed to another poster writing about some Treasury report to support some 1970s guy who said the typical liberal wants to tax unrealized gains. At least, I don't think it was you. At this point I have lost track and my ADD won't let me refocus.

 

[REWahoo]

Look! Up in the sky!

Is it a bird? Is it a plane?

No, it's Porkyman!

 

[Midpack]

Good! This one has run it's course IMHO...

 

[Alan]

Thanks folks....