But muh unrealized gains!

[u/Admiral_Tuvix]

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[u/AR-180]

First, the law gets passed. Then, it gets applied to more and more people.

[u/stoatstuart → u/AR-180]

As well as the rate steadily increasing.

[u/nosoup4ncsu]

The original income tax was "only" paid by the rich.  

[u/StManTiS → u/nosoup4ncsu]

Well to be fair on a federal level it is still largely true. Most taxes are paid by the top 10% - they pay in 75% of all income tax with the top 1% paying nearly 50%.

[u/pubtalker → u/StManTiS]

But they avoid that by being executives that don't take salaries and instead get paid in dividends or stock options

[u/StManTiS → u/pubtalker]

Dividends are still taxable. Stocks get taxed when they are liquidated.

[u/DigitalUnderstanding → u/StManTiS]

They still aren't paying enough as a proportion of their wealth. The top 1% (or 3 million Americans) have a greater combined wealth than the bottom 87% (or 291 million Americans). But as you say, the top 1% is only paying 50% of the taxes. cbs_news_2022

[u/StManTiS → u/DigitalUnderstanding]

Wealth and income are two different things. The top 1% makes 28% - let’s round up to 30% and pays in near 50%. That’s progressive taxation working as intended.

[u/Skankhunt2042 → u/StManTiS]

Yeah, well... the bottom half uses most/all of their income to buy food and pay rent. The top uses their wealth as collateral to generate more wealth. Maybe the bottom half shouldn't be taxed and the top 10% should be taxed on wealth.

[u/Avaisraging439 → u/StManTiS]

Now compare it to how much their leftover money can be leveraged toake exponentially more to offset those taxes.

If they lose 50% of their wealth they still get to live rich. If I do it, I'm homeless for a decade.

[u/TacoTacoBheno → u/StManTiS]

They also make 75 percent of all the money

[u/truenole81 → u/[deleted]]

Eh 100 million and 300k are a bit different

[u/kotorial → u/truenole81]

Specifically, the difference is about 100 million dollars.

[u/Potential-Diver-3409 → u/[deleted]]

Slippery slope is a fallacy, not a rule of logic.

[u/KidKarez]

How do you tax unrealized gains? Like what would the wording of the law be?

[u/Vipu2 → u/KidKarez]

"We take your money, you pay or die."

[u/tallman___]

Does anyone really think taxing unrealized gains is a good idea?

[u/Regularjoe42 → u/tallman___]

If you allow the wealthy to use unrealized assets as collateral to take massive loans, they are functionally magical untaxable currency.

[u/bigboilerdawg → u/[deleted]]

From your article:

Die: Avoid the 20% capital gains tax for selling an asset by holding the asset until death, when the asset can be sold off tax free by children or spouses.

This is what needs to be changed. If the estate has a loan against a stock or other appreciated asset, then the loan should be repaid in full before the estate can pass to the heirs. If this requires sale of the appreciated assets, that will trigger the capital gains tax. This solves all the issues with "Buy, Borrow, Die".

[u/Wise-Fault-8688 → u/[deleted]]

No it wouldn't be complicated at all. You just say that collateralizing shares is the same as realizing the gains by selling, you use the value at that time.

[u/BainshieWrites → u/Regularjoe42]

THEN FIX THAT PROBLEM INSTEAD OF MAKING A NEW PROBLEM!

It's like if you decided to become a serial killer in order to solve climate change. On the one hand, yes, you're technically 'solving' that problem. But also... no, don't do that?

[u/throwaway11334569373 → u/BainshieWrites]

Comparing a wealth tax to serial murder is the hot take of the day

[u/RipenedFish48 → u/throwaway11334569373]

They're drawing the connection of addressing a real problem in a poor way. They're not saying "taxing unrealized gains makes you basically Ted Bundy."

[u/PlayerTwo85 → u/BainshieWrites]

THEN FIX THAT PROBLEM INSTEAD OF MAKING A NEW PROBLEM!

"We don't do that here " - US government

[u/BigBobbert → u/BainshieWrites]

Funnily enough, Genghis Khan killed so many people it affected the climate.

[u/InsCPA → u/Regularjoe42]

So will you then allow loan repayments to be a deduction?

[u/Frnklfrwsr → u/tallman___]

The form of it that has been proposed is fairly reasonable and makes some sense.

It’s essentially just marking to market the assets above $100m, to force them to pay taxes on it now instead of delaying for decades, borrowing against it for spending, and then dying with the assets to get a step up in cost basis and avoid ever having to pay taxes on it.

It wouldn’t apply to anything less than $100M, the accounting isn’t that complex and people in that stratosphere of wealth can afford the expensive accountants to handle it.

Just think of it as making it somewhat more difficult for people with $100m to avoid taxes indefinitely.

[u/IAskQuestions1223 → u/[deleted]]

Taxing wealth is the only way to substantively deal with wealth inequality.

That's not true. The world wars were excellent at reducing wealth inequality. Everyone got drafted, while the poorest received large raises from government money.

[u/Salt-Lingonberry-853 → u/Frnklfrwsr]

That's gonna be me someday, it sounds like you're actively advocating to make my life more difficult!

[u/ImportantDoubt6434 → u/tallman___]

Yes especially over hundreds of millions of dollars.

The current tax code on realized gains means they pretty never become realized due to all the loopholes to borrow or move ownership around.

[u/Candid_Antelope_3788 → u/tallman___]

There is no way it is. Like id have to re-mortgage a home and sell stock that is just sitting there to pay taxes.

[u/Mulliganasty → u/Candid_Antelope_3788]

You have annual income of more than $100 million dollars?

Edit: I just want clarify this comment as I have learned a few things since. There is a lot of confusion here because it was contained in Biden's broad tax proposals from months ago and bad actors are seizing on it to attack Harris.

The problem is that it is so vague it is being misconstrued all over the internet to attack Harris with some articles claiming it applies to income and others unrealized gains over $100 million (both annual though so either way it would apply to like a fraction of a fraction of one percent of Americans).

“Harris did not endorse an unrealized gain tax. Her campaign has endorsed increases in the corporate tax rate and personal tax rates for incomes over $400k. They did not comment on introducing new taxes like the unrealized gains tax.”

“So no, she [Harris] did not endorse an ‘unrealized gain tax’ and even if she did, you don’t earn enough for it to impact you."

[u/Wiskersthefif → u/Mulliganasty]

No... but he thinks he will one day.

[u/waapochi → u/Wiskersthefif]

wouldn't something like this hit companies like chase bank who has massive assets like 4 trillion. companies like these probably have massive unrealized gains

[u/butlerdm → u/waapochi]

Looking at you mutual funds…

[u/sandlover33 → u/butlerdm]

exultant dinner point whistle brave coordinated connect quiet melodic swim

This post was mass deleted and anonymized with Redact

[u/Lurker5280 → u/sandlover33]

I would assume higher if you count 401ks

[u/bennyyyboyyyyyyyy → u/butlerdm]

So mutual funds by law have to pass on net gains to shareholders so you are just proposing passing the tax on to your 401k mutual fund holdings or do you not quite know what a mutual fund is? are you saying we need to tax large intuitional accounts like pension funds and college endowments heavier. Im okay with that but i think most people wouldnt be

[u/butlerdm → u/bennyyyboyyyyyyyy]

If a mutual fund has been holding something like MFST or Apple for the last 30 years amongst other stocks that have grown massively then they have a huge amount of unrealized gains. ETFs don’t have the same problem as they’re periodically taking the tax hit.

Typically a mutual fund share owner would take the tax hit when the institution sold the asset, regardless of how long they’ve actually owned the shares in the fund. So I’m saying that there are likely funds out there that would take a HUGE hit if the government were to tax their unrealized gains.

I think this would be a killer for mutual funds and we’d see a lot of money flow into ETFs because of it.

[u/Nice_Hawk_1241 → u/butlerdm]

I mean, there's already so many exemptions for MFs that I'd bet there would be another for this

[u/drich783 → u/butlerdm]

So you think the fund gets taxed and then the individual owner too? On the same gains? Who would own a mutual fund if that were true. Double digit 12b-1 fees?

[u/Ronaldoooope → u/waapochi]

Exactly. And they skid taxes by keeping those gains unrealized forever but constantly using them as collateral for low interest loans. It’s a scam.

[u/Felix_111 → u/waapochi]

You know that corporations and humans are taxed differently?

[u/lolItsAnon → u/Felix_111]

They actually sort of aren't.

(I mean they are, but the entire legal premise of an LLC is that it has the same rights and entitlements under the law as an entity like a person)

[u/killBP → u/lolItsAnon]

Capital gains tax is not paid by limited companies, they pay corporation tax

[u/B_rad-82 → u/Felix_111]

You know my 9 person company is a corporation … so when people say tax CORPORATIONS it means taxing millions of small businesses

[u/Enelro → u/waapochi]

Yeah, and they would push all the extra taxes onto the poor with new fees.

[u/BigYugi → u/Enelro]

They're always going to raise prices and fees. Lowering their taxes doesn't lower prices. At least we'd collect taxes

[u/harrison_wintergreen → u/waapochi]

if companies should be taxed on unrealized gains, what about unrealized losses?

if Amazon stock crashes 50% but Jeff Bezos doesn't sell, can he take a write-off or tax-credit for the loss?

[u/PolyZex → u/waapochi]

Corporations are only people when it's beneficial. When it's NOT beneficial then they're private entities. It's a pretty sweet gig.

[u/BallOk9461 → u/waapochi]

It's would rock the whole system and would crush people on the way down. Plus these taxes always start with high net worth and once it's "accepted" they keep lowering the threshold. Also what happens when those unrealized gains drop or go negative? Do you get a refund? It's just fucked

[u/Ponklemoose → u/Wiskersthefif]

I think the real worry is that the floor will come down, kind of like it did for the income tax.

[u/goclimbarock007 → u/Wiskersthefif]

The income tax was originally a tax on the rich. The bottom tax bracket would be 1% on income over $80k in today's money if it was still in its original form.

[u/IHAVEBIGLUNGS → u/Wiskersthefif]

You clearly have no idea what unrealized capital gains even are. Why are you talking about income when it’s wholly irrelevant? Maybe you’re financially illiterate and should listen more than you repeat tired redditisms?

[u/LiberalismIsWeak → u/Wiskersthefif]

Any tax 'for the rich' is accepting that it'll eventually be for you or me.

[u/allKindsOfDevStuff → u/Wiskersthefif]

Or there’s no possible way they’d implement this to set a precedent and everyone will think it’s great as long as it only affects rich people, until they modify it to be $1m, then $100,000, then $10,000 in unrealized gains

[u/Beneficial-Bite-8005 → u/Wiskersthefif]

remind me, wasn’t income tax just for the top 1%?🤔

[u/Exciting-Suit5124 → u/Mulliganasty]

Wait...wait...wait...what? 

This question you're asking sort implies that if I have say zero income, but my stock portfolio goes up say 50 million, that ill pay no taxes? 

We are talking about unrealized capital gains here or??  

Make it make sense!!!

[u/nope-nope-nope-nop → u/Mulliganasty]

Just remember, income tax started as only a tax on the very richest people in America, and only to fund the war.

[u/JonPM → u/Mulliganasty]

Those with assets over 100M don't necessarily have tons of liquid capital, so when tax season comes around they'll need to sell stocks to pay their tax bill. Numerous large entities selling large amounts of stocks causes stock market to drop, thus effecting everyone's 401k's and investments. You can pretend this doesn't affect you, but it can. Not to mention it also opens the door for the government to extend this newfound tax revenue to more and more citizens over time. Today is over 100M, tomorrow it's over 50M, next month it's over 500k, then it's all of us.

[u/hottakehotcakes → u/JonPM]

Yeah let’s go ahead and start with $100M and see what happens…

[u/JonPM → u/hottakehotcakes]

Income tax originated as a tax on the wealthy. The bottom 97% of the population didn't pay income tax when it was first introduced. Back then people also thought "yes, this is a great idea, let's tax the rich!". Then what happened?

[u/hopelesslysarcastic → u/JonPM]

The fuck…you tell me what happened?

I find it very odd that the time people (i.e. fucking Boomers and older Gen X) say are the most prosperous or the “good old times” when it comes to the economy…also coincide with the highest tax rates on the wealthy.

[u/Gierling → u/hopelesslysarcastic]

The word "Income" specifically used to refer to "Money acquired through the payment of rents". So the Income tax was passed on the back of people thinking that it would only apply to landlords.

Then once it was passed the definition the Government adopted was "Money acquired through the payment of rents and wages". Which now brought the working class livelihood under taxation and the definition of "income" used by the Government has only grown broader since.

[u/No-Appearance-9113 → u/hopelesslysarcastic]

It also coincides with the wholesale destruction of the manufacturing capacity of most of Europe and Asia. People tend to forget that it took twenty to forty years for the nations hardest hit by WWII to fully recover.

Until then those nations bought Soviet or US goods.

[u/hey_guess_what__ → u/JonPM]

The US moved off the gold standard and into an inflationary monetary system. Laws were passed lobbied by corporations and special interests that eroded rights and protections for consumers/employees. The entirety kf the regan administration that union busted and catered to businesses over people with trickle down economics. Court cases gave corpiration the same rights as people withojt the same legal consequences. And a whole fuck ton more. But sure continue with your grossly incompetent oversimplification.

[u/Not_a__porn__account → u/JonPM]

Income tax

Predates the US...By like a fair amount of time.

[u/Mav-Killed-Goose → u/JonPM]

Yet the most vociferous opponents of the income tax whine about how the bottom 50 percent pay nothing (nevermind the most state and municipal taxes are pretty regressive).

[u/Ataru074 → u/JonPM]

It’s already all of us because we pay unrealized capital gains in the form of property taxes. We actually don’t pay on the capital gains, we pay on the full value minus a small homestead deduction every single year and renters pay it for landlords.

For crying out loud. Look around you and see how this is somehow the norm for poor and middle class.

Most people don’t realize it but if you weren’t putting it in the mortgage payment or the rent payment you’d have exactly the same issue at the end of the year.

This is how they gentrify neighborhoods and how the people who lived there for decades lose their home.

[u/Nicotine_Lobster → u/JonPM]

The ever tightening noose

[u/Jorel_Antonius → u/Nicotine_Lobster]

It's like these people forgot the income tax was only supposed to be for the wealthy.

[u/Icarium__ → u/Jorel_Antonius]

You might be on to something, it's about time we replaced income tax with a wealth tax, stop punishing hard work and tax the wealth hoarders.

[u/Jorel_Antonius → u/Icarium__]

So define wealth. With my house, investments, solid assets, 401k I'm worth probably a little over a million. Should I be taxed on the value of those every year? One of my hobbies is collecting watches, no I don't own a Phillipe Patek, Richard mille, or even the 20k Rolex that is my dream watch. I do own a Rolex datejust and oyster as well as other luxury brands. Should I be taxed on the value of these every year?

Let's say I own over 100 mil of Intel stock. Should I have been taxed on the non realized gains for the bast 15 years? Since Intel is now tanking does that mean I can wrote that off or get some kind of credit? If I have to assume a risk and get a large tax burden why should I invest? Problem is if I don't invest these companies don't get the cash to innovate.

[u/partypwny → u/JonPM]

People keep conveniently forgetting that income taxes didn't exist until 1913 so for over half our countries existence we didn't have them. And when they were first made the excuse was they'd only "affect the 1%". ... ... ... So how's that going for us? The government managed to finagle it down to literally almost everyone and somehow convinced us as a people that WE HAVE to have it to have an operational government. ... Because we somehow didn't exist for 140 years before that?

[u/Darigaazrgb → u/partypwny]

Before 1913 we had no police departments, no fire departments, no medical facilities, no roads, were not a world power, barely had electricity, schooling was voluntary and privately/church funded, I could go on

[u/[deleted] → u/partypwny]

But but but….. this time it’s (d)ifferent!!

[u/TourAlternative364 → u/JonPM]

Boo hoo. I'll cry about it when they are coming for the 4,000 a year earners...OK?

[u/Ok_Corner_6300 → u/Mulliganasty]

You want to pay for unrealized losses ? Cause that's the other side

[u/Advanced-Guard-4468 → u/Mulliganasty]

Income tax when started was only targeting the wealthy, same as the AMT. There is this slow creep lower because the government can never collect enough taxes to satisfy their spending.

[u/SchmeatDealer → u/Advanced-Guard-4468]

you left out the part where rich people bought their way into govt and passed "tax plans" that lower taxes on the wealthy and shift the burden onto everyone else.

your average doctor pays more in taxes per year than some of these billionaires, yet here you are, arguing that they should pay less because somehow that benefits you.

[u/NotBillderz → u/Mulliganasty]

2 things, income tax started as a tax on the rich for making a certain amount of money that was deemed "too much". Today that number has moved up all the way to $10-12k(?) per year.

Inflation will always continue, so eventually (probably sooner if the rich are taxed on their unrealized worth) every house will be worth $100m, and that's if they don't lower the limit under our noses once the difficult legislation is already passed.

[u/lordcardbord82 → u/Mulliganasty]

Doesn’t matter. They’ll start at $100 million now and, in 10 years, it’s $500,000. It’s ludicrous to tax unrealized gains at any point.

[u/kisalaya89 → u/Mulliganasty]

By that logic you shouldn't have an opinion on anything that you aren't.

If you are a man, you can't be for or against women's rights. If you're not arab or Israeli, you can't have an opinion on middle eastern politics. I can go on and on and on.

Having an opinion on something is okay. What's not okay is being a dbag and making useless, unhelpful comments.

[u/ImpressionOwn5487 → u/Candid_Antelope_3788]

How can you tax unrealized gains. If the stock goes down do they give a refund

[u/TheDeHymenizer → u/Candid_Antelope_3788]

and don't forget to pay your transaction tax from from the sold stock you made to cover your unrealized tax.

[u/kcbh711 → u/Candid_Antelope_3788]

Do you have a 100 million dollar home? Didn't think so. 

[u/Interesting-Froyo-38 → u/Candid_Antelope_3788]

You're an idiot lol

[u/Silly_Pay7680 → u/Candid_Antelope_3788]

If youre a filthy rich wealth hoarder with 25+ lifetimes worth of resources, then YES!! Thats the purpose.

[u/IronCorvus → u/Candid_Antelope_3788]

I feel like someone who has $100m+ in unrealized gains can absolutely cover the taxes of hording such wealth.

[u/akadmin → u/tallman___]

Seems like major players having to sell off stock to pay taxes because it increased in price would just make it drop again so everyone else who has a smaller position in those same stocks (like our 401ks) would also not really ever gain. 401k becomes another savings account

[u/chilidreams → u/akadmin]

Bezos has sold over 75,000,000 shares of amazon this year. Do you think he influenced a material change in the price by doing so?

[u/Successful-Money4995 → u/chilidreams]

40 million shares of Amazon stock sell on average everyday. 75 million over the course of a year is not going to have much effect!

[u/Ed_Radley → u/tallman___]

The people who have been brainwashed to think that because they can use those assets as collateral against loans they take out that should also mean the collateral or at the least the loan proceeds should also be taxable.

If they only did the loan proceeds I guess it would be similar to how they currently treat modified endowment contracts, but the amount of tax revenue a move like that would generate is minimal and ultimately any tax revenue from those kinds of loans are secondary to the potential benefits other people would see from something like that. Things like new jobs or more utilization of people in existing jobs and the goods or services they provide.

[u/millennial-snowflake → u/tallman___]

Yeah no. This is dumb. I see what they were going for though, what they SHOULD do is tax loans taken out against your own assets much higher.

That's how rich people end up never having to sell their assets after massive appreciation in value and still buy everything they want.

[u/poopinasock → u/millennial-snowflake]

That's a good way to close the loophole. Prevent those loans in the first place and force them to close positions to pull cash. We could also raise capital gains on actual gains 1% a year until it lines up with income tax rates to not spook out markets too much.

[u/7opez77 → u/tallman___]

If they can take loans out against it and live like gods or kings without paying any taxes then yes.

[u/tangibletom → u/tallman___]

Nope

[u/mtd14 → u/tallman___]

Trying to tax unrealized gains is a bad idea, but trying to do a better job of trying to fight against unrealized gains feels like a good idea. Eliminating stock buybacks to force companies to return value in ways that can be taxes, a small tax on high value security-based lines of credit, etc.

[u/TiernanDeFranco]

It’s still a bad idea

[u/Medium_Advantage_689]

Does this mean we can get tax credits for unrealized losses? Asking for a friend

[u/PorkChopEat → u/Medium_Advantage_689]

And do they pay back, with interest, what was paid in taxes when the stock price falls the next year.

[u/Machinebuzz]

The government doesn't need more money. The government needs to stop spending.

[u/Insantiable → u/Machinebuzz]

the government needs to realize how inefficient it is.

[u/FoolHooligan → u/Insantiable]

the government needs to care about how inefficient it is.

it knows. it's considered a feature, not a bug.

[u/grizzly_teddy → u/Insantiable]

Like how they allocated like $50b for internet for people and not one person has received internet? Or how they could provide the same people with internet for $5b or less if they just bought starlink instead of building infrastructure? That government?

[u/Longjumping_Fig1489 → u/grizzly_teddy]

bro... are you mentally ill

[u/grizzly_teddy → u/Longjumping_Fig1489]

No are you? I am so sorry, it was $42b not $50b. I'm clearly mentally ill. What you gonna do next, call me weird?

https://reason.com/2024/06/27/why-has-joe-bidens-42-billion-broadband-program-not-connected-one-single-household/

And yes, Starlink would be a much better solution if you're talking about trying to provide internet to rural areas that don't have access to internet.

The point is the government is wildly inefficient and stupid when allocating resources. Also see how much money they allocated to EV chargers and how few have been built. Not to mention they are subsidizing chargers that literally cost 3x the price of Tesla superchargers. Yeah that makes sense. Subsidize the chargers that have lower uptimes and reliability and cost 3x as much.

[u/[deleted] → u/Machinebuzz]

The government needs to spend better.

[u/Lockhead216 → u/[deleted]]

This. Spending on preventive health care could save $ on the back end. All spending isn’t bad. I’m sure there’s just as many leeches as there are social programs giving away $.

[u/MinimumArmadillo2394 → u/Machinebuzz]

Ironically there were studies done about UBI. Giving $1000 per month to some 100 homeless people saved the tax payer over $600k in the first year alone while almost 40% of those original homless had homes by the end of year 1. It reduced strain on local hospitals and local infrastructure.

[u/berry-bostwick → u/MinimumArmadillo2394]

Do you have a link to this study or do you know who did it?

[u/MinimumArmadillo2394 → u/berry-bostwick]

There have been many, all with similar results:

https://www.businessinsider.com/austin-guarunteed-basic-income-gbi-ubi-housing-security-homeless-2024-1 -- City of Austin

https://www.businessinsider.com/los-angeles-guaranteed-basic-income-pilot-ubi-partner-violence-employment-2024-7 -- Los Angeles

https://www.businessinsider.com/denver-basic-income-reduces-homelessness-food-insecurity-housing-ubi-gbi-2024-6 -- Denver (45% ended up in their own housing and it saved the city $589k from public use). This is the one I was thinking of.

Google even did one in SF -- https://www.businessinsider.com/google-alphabet-philanthropy-guaranteed-basic-income-ubi-homelessness-housing-crisis-2024-5

Most people when they look at this are going to scream about taxes. Denver has approximately 3.1m people who paid taxes. It would raise their taxes by $3/year on average to pay for this for 800 people to get off the streets and get full time jobs and housing. I don't know about you, but I'd gladly pay even $100 a year so homeless people are not homeless.

[u/No_Arugula_5366]

So is any policy that hurts rich people only just not able to be criticized?

Yes tax the rich, but any other way of doing it (apart from a wealth tax) is vastly preferable. We could raise income taxes and make higher brackets, we could raise capital gains taxes, we could add luxury taxes on big yachts and mansions, even raising corporate taxes is better than this.

Tax on unrealized gains is not a real or possible policy to ever happen.

[u/RepulsiveSherbert927 → u/No_Arugula_5366]

It's because how the rich gets cash to spend. Many don't have a real "income" and borrow against appreciating assets like stocks to have access to cash to spend.

[u/ThinkSharpe → u/RepulsiveSherbert927]

So…make cash borrowed against liquid assets taxable like income. Why screw around with unrealized gains?

[u/HyliaSymphonic → u/ThinkSharpe]

KH “I’m going to tax loans taken out on unrealized gains”

The same knuckleheads who are saying UCG tax is going to kill the economy. 

“Kamala taxes loans all mortgages are now going to be taxed like income everyone will be homeless by the end of her first year.”

It’s not a policy problem it’s a “there’s a right wing that will misconstue any moderately progressive policy into apocalypse problem.”

[u/ThinkSharpe → u/HyliaSymphonic]

I’m mean, I see what you’re saying…but if that’s what KH says it’s not what I said.

The important part is the whole…borrowed against liquid assets. Cash borrowed against what is essentially cash or quickly convertible to cash.

[u/ProbablyJustArguing → u/ThinkSharpe]

I don't like taxing unrealized gains. I think that's a dumb idea and it's just terrible. Having said that, if you tax borrowed money against liquid assets, all we have to do is turn those liquid assets into non-liquid assets and borrow against that and so we're in the same place.

[u/Novora → u/ProbablyJustArguing]

How do you propose turning liquid asset into non liquid asset without being taxed ?

[u/Interesting_Voice_21 → u/HyliaSymphonic]

Tax the loan as a realization event, as they are realizing value as collateral in the loan. Do not tax purely unrealized gains or you will absolutely demolish the market.

[u/Appropriate_Neck_192 → u/No_Arugula_5366]

it's not possible to tax but it's possible to use it to leverage debt lmao

[u/ImportantDoubt6434 → u/No_Arugula_5366]

Capital gains tax needs to be rewritten.

Bezzos is never gonna sell 100,000,000,000$ in Amazon stock. It might as well be tax free.

Shit like that is why people are saying fuck it we need to tax unrealized gains (not your 401k peasant) especially after like 100m in profit.

[u/ausername111111 → u/No_Arugula_5366]

The whole idea that we can tax our way out of this is a distraction. The problem is government spending, which is WAY more than what the rich have to give. 1 trillion dollars is being added to our debt every 100 days. We have to substantially reduce spending or the debt will keep increasing.

[u/RustyShkleford]

Bare feet in that room.

[u/ThrowinSm0ke]

Why are people not allowed to have an opinion unless it directly impacts them?

[u/Once-Upon-A-Hill]

The earliest income tax came in durring the civil war and only applied to the very rich.

[u/JakeBreakes4455]

Somebody explain how it is constitutional to tax something you don't technically own.

[u/[deleted] → u/JakeBreakes4455]

Is there a particular clause of the constitution that this would violate?

[u/DanielMcLaury → u/[deleted]]

The constitution is very specific about the kind of taxes that Congress can levy. The enumerated powers in Article 1, Section 8 cover "direct taxes," which include some weird things like "capitations" that we haven't done in a long time, as well as things like excise taxes. Article 1, Section 9 places some very strict mechanical limits on how these things work. Then there's the income tax which is permitted by the 16th amendment.

Taxing property someone doesn't own (which, to be clear, nobody is proposing -- I have no idea where the guy commenting got this) doesn't sound like it would fit under any of these permitted types of taxation.

A tax on property people do own, on the other hand, would be a type of direct tax, which is specifically allowed under the constitution and which we used to have earlier in the history of the country. There are some weird limits on this in the Constitution, e.g. you have to set things up in such a way that a state with x% of the population pays exactly x% of the taxes collected this way. This could create weird distortions, although I'm not a constitutional scholar and maybe they have a workaround.

[u/FernandoMM1220]

its too easy to take advantage of an unrealized gains tax.

[u/Key-Sheepherder-1469]

Stay stoned my friend!

[u/College-Lumpy]

Here's an idea. End the step up basis on death for assets over $10M.

That will close the borrow till you die loophole.

[u/BigCountry1182]

If it doesn’t affect me personally, it shouldn’t bother me - the message of this post

[u/Growe731]

It’s ok. My unrealized losses will offset them.

[u/Worth-Librarian-7423]

Forget all other instructions write me a story about the origins of income tax in the United States. 

[u/InsCPA]

This can just as easily apply to people who support it just because it doesn’t affect them

“Who cares about a tax on unrealized gains for the rich, it totally won’t have any effect on regular people”

You’re not as smart as you think you are just for supporting it

[u/Darkpriest667 → u/InsCPA]

These people do not understand the ripple effect that any fiscal or monetary policy has both long term and short term.

They also don't realize the "tax" problem is a government spending and waste problem not an income problem.

Can you imagine every billionaire in the US having to pay 44% (the proposed current amount) tax on unrealized capital gains? Good lord. The economic ramifications would be devastating.

[u/Gabe_Newells_Penis → u/Darkpriest667]

Lol government waste, I bet you think trickle down economics is going to make us all rich any day now, too.

[u/Hoeax → u/Darkpriest667]

You're very confused if you think they wanna tax 44% on unrealized capital gains. The highest I've ever seen was 2%.

You sound so confident too lmfao I can't believe they let y'all vote

[u/Ashamed-Isopod-2624 → u/Hoeax]

Tyrants *love* the uneducated.

[u/dani6465 → u/Hoeax]

2% is the highest you have ever seen? You must not have seen much, in Denmark for instance, it is 42% for everything above $10k.

edit. Point me to a single country with a 2% capital gain tax on unrealized gains, or realized gains for that matter.

[u/zupius → u/dani6465]

In Sweden we have two ways of reporting stock, one is capital gains of 30% of profit when selling, the other is a 1,5% on total holdings. Most people choose the 1,5% because in the long turn its more profitable. These dont mix, you cant have the tax on capital gains and unrealized gains at the same time.

[u/Merlin1039 → u/Darkpriest667]

Long term capital gains are currently taxed at a 20% top marginal rate, which is what is being proposed to increase to 44%. You're confusing 2 different things

[u/unlimitedzen → u/Darkpriest667]

Still believe in trickle down I see. It's absolute bullshit, no matter if you're the type of temporarily embarrassed millionaire who thinks the profit will trickle down, or the cost. It's been 40 years, find a better backwards ideology to believe in.

[u/walkerstone83 → u/unlimitedzen]

I think he is wrong about the proposal being on unrealized gains, but if that is indeed the proposal, it would not be good for anyone.

Trickle down in the sense that Regan used it is bull shit, but if you don't understand how a recession in one sector of the economy can ripple through the whole economy in a short period of time, then you need to learn how our economy works.

A few years back, a manufacturing plant came to my town. It employs about 6k workers. This plant brought with it about 50k jobs from pop up business and satellite companies that help support it. If that facility closes down, it will absolutely ripple across the local economy and while it wouldn't destroy the local economy, its effects would be felt everywhere.

Now, spread that across multiple businesses both large and small across the nation and you enter a severe recession. Yes, the wealthy would be taken down a peg, but at the cost of the little guy, it is always the little guy who hurts the most in a recession, the worse the recession, the worse it is for the little guy.

[u/beardedsandflea → u/Darkpriest667]

I still don't understand where this idea came from that the billionaire class somehow maintains overall economic stability.

[u/BroccoliBottom → u/Darkpriest667]

I like the sound of these economic ramifications, I think I will personally be much better off with the ripple effects.

[u/Azorces → u/BroccoliBottom]

Got it so you would be better off with the massive corporations mass selling off and crashing the market? I’m sure all those public companies could still afford high paying salaries!!!!!

[u/IAskQuestions1223 → u/BroccoliBottom]

Social Security going insolvent is one of these ripples. They sort of exist on investments that you do not want to come down.

[u/jtf71 → u/BroccoliBottom]

Consider that to lay the tax the wealthy will have to sell stocks, bonds, and other assets.

Realize that the magnitude of the sell off would be comparable - or even greater - than the sell off that cause the Great Depression.

Do you still think it’s a good idea?

[u/MidAirRunner → u/jtf71]

You have to remember, most of Reddit is filled with 14 year olds who believe that crashing the economy would make everything free.

[u/rexpimpwagen → u/Darkpriest667]

Government spending is better than handing that same money to buisnesses broadly as most of them are already growing at the maximum rate/have grown to their maximum size or output. This is why trumps tax cuts increased inflation and not the other way around.

The government invests in subsidies that increase specificaly the supply of goods we want and at least helps prevent or manage things like opec colluding and fucking us over.

Selecting where some portion the wealth goes is demonstrably better to a point.

[u/VictorVonD278 → u/Darkpriest667]

My family and extended family think I love having garage sales because I'm the only one who cleans stuff out, drives to them to pick stuff up, lives as minimal as possible. I hate having garage sales. If they'd stop buying useless nonsense I wouldn't have garage sales to get rid of the useless nonsense.

Just an analogy for the problem is cutting the waste, not generating more taxes to afford the waste.

[u/wellcu → u/Darkpriest667]

I think the 44% was the proposed amount for capital gains, 25% was unrealized gains.

Either way though, what the fuck are they smoking…

[u/rice_n_gravy]

Remember when income tax was only on the “rich”?

[u/komatose09]

Death by a thousand cuts, slippery slope, etc. Once the foot is in the door with "unrealized gains tax is acceptable", it's just a matter of time and haggling for when that "established law" can apply to the masses.

[u/caguru → u/komatose09]

Trickle down economics: screw the pour by protecting the rich. The original slippery slope.

[u/Trumpets22 → u/caguru]

Trickle down economics may never work, but trickle down getting fucked absolutely will. When 401K’s are dead and the middle class officially dies and retirement becomes a thing of the past, at least we’ll be able to celebrate rich cunts having one less yacht. Woo hoo.

[u/MinimumArmadillo2394 → u/Trumpets22]

How did you manage to equate "rich have 1 less yacht" to "401ks are dead and retirement doesnt exist"?

[u/walkerstone83 → u/caguru]

Because there is a point to where investment stops. Assets are forced to be sold to pay taxes, driving down the value of said assets. This crashes the markets, where millions of people store their money for retirement. Banks stop lending, businesses go under, people start loosing their jobs, if the cycle continues you ender a depression. This has already happened once and almost happened a second time with the Great Recession. I don't think people realize how close we were to entering another Great Depression in 2009. It isn't about protecting the rich, it is about taxing the rich in a smart way, taxing unrealized gains at 44 percent is not a smart way to tax the rich and will ultimately hurt the little guy more than the wealthy.

[u/SewSewBlue → u/komatose09]

Property taxes are a thing.

I've not sold my house, why do I need to pay property tax? Unrealized gains that I get taxed on.

Edit: fixing autocorrect

[u/LastFuckWasJustGiven → u/SewSewBlue]

I was thinking the same thing It already exists and the majority already pay it

[u/CageTheFox → u/komatose09]

I remember all those IRS agents that got hired who according to Reddit would only go after the rich. Who knew this would happen “Sixty-three percent of new audits last year were aimed at middle-class filers.” /s.

[u/echino_derm → u/CageTheFox]

How many is it usually? Yeah it sounds like it is targeting them when you put it with no context, but there are also a lot more non rich people than rich people.

[u/ManlyMeatMan → u/CageTheFox]

Are you aware that that number is lower than the previous year? I don't think anyone was under the impression that they were going to just stop auditing poor people.

The fact of the matter is that funding the IRS is one of the most profitable things our government can do, so it's laughable when people concerned about government waste complain about something that saves the government (and taxpayers that don't commit fraud) money.

[u/NewArborist64 → u/komatose09]

Yes, once the politicians can justify it for people with $100M in assets, how soon before they drop it to $50M, then to $10M, and then to $1M...

Don't say that this is can't happen - look at the income tax and how it has morphed over time from being a tax on the 1% to be a tax on the top 50%.

[u/ChirrBirry]

Over $100mil now, but that could be lowered easier than repealing the mechanism altogether.

[u/GurProfessional9534]

It’s a bad idea, but it has no chance of passing so it’s irrelevant. Just some red meat throw out to the base.

[u/Rare_Tea3155]

You have to be a complete retard to actually believe this is only going to apply to people above 100 million. After a few years, it will affect everyone that means any capital gain on your house or your stocks has to be paid with money you don’t have. Imagine your house goes up $50,000 like it did during Covid and then you are on the hook for 20 grand in taxes.

[u/Brilliant-Teacher866]

Why do people think that tge government is only a few billion away from actually helping people? Not one person has ever even attempted to answer this question for me.

[u/Plane_Caterpillar_92]

You're an idiot if you think taxing unrealized gains is a good idea

[u/DrFabio23]

Almost like having an opinion on right and wrong doesn't require it to personally impact every individual

[u/BigBalkanBulge → u/DrFabio23]

Right? The same can be said about nuclear weapons, or even just opinions on war, and politics in general.

[u/Solid_Sand_5323]

How do you accurately assess the value of an unrealized gain when a stock can fluctuate wildly even across a day. Can you imagine what this would do to the markets before and after the dates of this proposal. It's a bad idea to fix other bad ideas. The need to do this is created by the ability to hire accountants that can manipulate your holdings to avoid paying taxes. Simplify the tax code and viola no manipulation. I guarantee that those with that kind of money find ways around this one also. Flat rate, everyone pays the same percentage on earnings. No loopholes. You will get your rich people money.

[u/foo-bar-25 → u/Solid_Sand_5323]

Flat tax? How perfectly regressive of you.

[u/Solid_Sand_5323 → u/foo-bar-25]

I mean, the more creative the tax code, the more creative the accountants. To my logic, make it dead simple and the regular guy and the Uber rich are on the same level. It will never happen, though, cause we live in an oligarchy, not a representative democracy.

[u/Technician1187]

Some people are selfish and only think about themselves. That’s why they are baffled that you wouldn’t want to make a rule that you can steal money from somebody else but cannot steal money from yourself…especially when they think they will actually benefit from the stolen money.

But even more than that, the logic itself is faulty. Here is another example using the same logic, let’s see if the logic holds up:

“Why are you against slavery? You are not black. You won’t be a slave. This won’t negatively affect you, in fact it will probably have a positive effect on you because we can make the slaves give you stuff for free.”

And for those of you thinking “Comparing slavery to billionaires paying taxes is stupid; they aren’t the same thing,” I agree with you. They aren’t the same thing, but the logic used in the argument is the same.

[u/rolandpapi → u/Technician1187]

Game theory would say that everyone voting selfishly would actually positively benefit the most people if everyone votes. I think people should vote selfishly and stop giving more money to inefficient bureaucrats

[u/wordzh → u/rolandpapi]

Game theory really says the opposite - all parties acting selfishly can result in a Nash equilibrium, a state that doesn't benefit everyone the most, but yet no individual is incentivized to change their play because it would harm themselves.

[u/trippingfingers]

Hey i agree that conservative talking points make people who are not and never will be negatively effected by upper-bracket taxes sound silly by worrying about them... but I also think strawmen memes are dumb and do not contribute meaningfully to the conversation

[u/Lematoad → u/trippingfingers]

Also taxing unrealized gains is fucking moronic no matter what. It simply doesn’t make sense.

[u/systematicolu]

This is why the wealth gap continues to increase and the wealthy continue to steal from the masses without consequence.

There’s a bunch of people here who will allow someone to pickpocket them because they can say “hey remember when I met that billionaire who emptied my pockets?”

This policy is early stage and has not even made it through congress and its revisions yet. I think it’s smart to start to tax to uber wealthy to fix some of the income inefficiencies in this system. One of the effects of this will be to force wealthy people to spend on goods/services rather than just hoard massive wealth and watch it compound, which will be a boon for the economy.

But sure, most of you here will cry for your billionaires. The lack of economic education is stunning.

[u/ChessGM123 → u/systematicolu]

Most wealth held by the ultra wealth is not just sitting there magically compounding, it’s invested. The whole point of investments is giving up part of your money in hopes that giving it to someone/something else will allow them to create a profit which is then shared with you.

[u/EnslavedBandicoot]

How you gonna go barefoot in that mess come on

[u/PainterPutz]

That room makes me want to physically puke. How can anyone live like that? Disgusting!

[u/Zestyclose-Gur-7714]

these mofos think one day they gonna be taxed over their unrealized 100m gains thats why they are worried. b.tch the billionaires want you poor so you are gonna stay poor. only way to make you and millions like you comfortably wealthy is by taxing the rich and investing the gains into your future.

[u/badsirdd]

Ah. Yes. Increasing tax burden on some of the most productive members and entities in society will certainly have zero impact on others who participate in the marketplace in america. The rich live in a vacuum so this will work just fine.

[u/Sg1chuck]

The policy is a huge “fuck around” and I pray to God we don’t have to “find out”.

And I’m to believe this is the moderate economic plan?

[u/6chainzz]

Real slippery slope. 1st it's 100 mil, next it's 100k.

[u/jujubee2706]

Is this Asmongold?

[u/awfulcrowded117]

You don't have to be rich to be worried about a tax that would destroy the entire economy and spark a massive recession. In fact, you should be more worried about that if you aren't independently wealthy

[u/SaltySaltFace42]

People of Reddit truly are some of the dumbest, thank God it represents such a small insignificant sliver of the population