zlacker

>>southe+(OP)
I wonder if this is coming up just before the election because of the Harris campaign’s suggested policy of capital gains tax on unrealised gains for people who have over $100m in assets? I think this is a great idea personally given what these people are doing to avoid paying tax including taking out loans against their own share portfolios. Worth thinking about what people are willing to do to not pay billions of dollars worth of taxes.

>>andy_p+ex
I'd much prefer seeing us close up the tax loop holes than create an even more complex system.

Taxing unrealized gains will be extremely complex, and given that they aren't allowing us to deduct unrealized losses its a pretty shitty setup for the taxpayer.

We need to drastically simplify our tax code rather than further increase its complexity.

>>_heimd+Ry
Doesn't this "close" the tax loophole in which holders of tradable assets can take out loans against those assets in perpetuity, never paying taxes on any of it?

>>zelias+kN
I mean, you have to pay the loans back. Which requires income which is taxed. This would only work if you either don't spend any money (which then what is the point of the loan) or if your assets are always going up and increasing in value beyond that of the loan which inevitably will not be the case.

>>nights+LQ
> Which requires income which is taxed

And there lies the loophole. These loans are often structured as some kind of business expense that can be paid from pre-tax income.

So, ultra rich people get to double dip here. No taxes on selling stocks for money, as there's a loan, plus no taxes on the income for paying it off.

>>fooker+C11
That's not a loophole, it is illegal. You can't deduct personal expenses from a business. I realize the rich do it, but if that is the problem let's go after that.

Also if you sell stocks you always pay tax on the capital gains regardless if there is a loan or not.

>>nights+m51
>You can't deduct personal expenses from a business. I realize the rich do it, but if that is the problem let's go after that.

We have gone 'after it' again and again, making the system more and more complex. So much that you can now out-lawyer the IRS if you have enough money. There is no 'personal' expense, everything is somehow a business need. There is no simple solution to this really. Whatever you do to hurt ten billionaires, the ten million small business owners will face the brunt of it.

>Also if you sell stocks you always pay tax on the capital gains regardless if there is a loan or not.

That is the point, you don't sell stocks that makes you a billionaire. Instead, you find more and more creative ways to leverage that stock for loans, for deals, for power/control, etc etc. Also see cross collaterals where the same asset is used for multiple purposes at the same time!