Taxing “unrealized capital gains” sounds like a catchy and obscure way to make wealthy people pay more in taxes, but it doesn’t work. A government that moves in this direction ignores the reality that people are not static. The process also involves “taxing wealth” which then becomes an arbitrary definition.
Unrealized capital gains are not income, they are simply increases in value.
If your home was worth $200,000 last year and $300,000 this year, you have an unrealized capital gain of $100k. A 15% tax bill on that value increase means the homeowner would have to pay $15,000 to the IRS.
Joe Biden is proposing to pay for his multi-trillion expansion in debt through this type of tax upon billionaires. Treasury Secretary Janet Yellen admitted this was part of their thinking to help pay for the Biden budget last Sunday. WATCH:
.
Proposing a tax on money that does not exist is the peak of government. Sure the proposal applies only to billionaires who have massive gains in their stock portfolios, but billionaires are not esoteric titles. Billionaires are people who can, if needed, move their physical location and avoid any U.S. tax on their wealth.
This is the same reason why corporations move the location of their home offices to countries with lower tax rates, a process called corporate inversion.
If Elon Musk, Warren Buffet or any other multi-billionaire wanted to avoid U.S. taxes on their personal wealth they can (relatively easily) change their official residence to Mexico or any other nation where the value of their yet unrealized wealth would not be taxed. That individual inversion process is an easily predictable unintended consequence.
As noted in The Hill:
[…] Biden is suggesting that he will pay for the new spending by taxing people not on what they have earned but what they could earn from selling assets. Most people have assets that increase in value over time. Consider a family home. Over the course of many years, it can easily double in value, but you do not “realize” that money unless you sell it. Biden is suggesting that the government should start taxing you based on any increased value of the things you own, even though you have not actually made that money. It doesn’t matter that the home or stock or art could ultimately go down in value after you are taxed on the higher value. Indeed, if you tax some unrealized gains, you could in extreme cases force people to sell assets like a home to pay the tax on income that they did not make.
The administration has started where few would object: billionaires. (read more)
Additionally, another issue arises if the previously taxed asset goes down in value; an issue where the depreciation or loss becomes a negative tax liability. Meaning if you already paid taxes on an increase in value for an asset, and the following year that asset drops in value, the federal government would then owe you money to recompensate you for a realized loss. If you paid $15k on a $100k increase in the value of an asset, and the following year that asset drops in value by $100k, the $15k you paid would be deducted from the current year tax liability.
There are constitutional issues with the federal government taxing wealth or assets; however, the overarching premise behind every proposal is that all wealth belongs to the government. You hear this ideological perspective when people say “tax expenditures” or spending in the tax code. The idea is that your income is what the government permits you to keep, NOT what your labor has achieved.
The ideology behind taxing “unrealized capital gains” is the same ideology in the premise of “sharing the wealth.” It is an ideology that stems from a belief that your dollar earned comes at the cost of my dollar not achieved.
Beware the voices who would advocate for taxing unrealized gains in wealth as a source of government revenue. Once you start down the path of taxing wealth you set up a process where the U.S. government controls the limits of where that wealth is defined. It will never stop at billionaires….
Taxation is theft , especially when we have no real representation anymore.
Very old one-liner from the OLD Reader’s Digest:
If Patrick Henry thought taxation without representation was bad, he should see it with representation.
When the value goes down do we get a re-imbursement, Nooooooo. One way IRS.
The government will take the position that YOU erred in NOT selling the asset at its peak value. THEY are faultless.
Just imagine how complex the administration of this would be, or I should say maladministration. I don’t believe they could make it work ever. Though perhaps this is why they want to hire an extra 80,000 for the IRS.
But I do not believe that any of these senators or reps would want to go into an election next year facing the rage of people whose assets have been effectively seized. Because this is exactly that. Can you imagine asking for votes from people whose tax bills are unpayable? A Civil Asset Forfeiture of monstrous, and I suspect, unconstitutional proportions.
That $600 bank transaction reporting they are trying to sneak through suddenly takes on a whole new meaning!
It really does. My understanding is that it is as dead as I hope this latest insanity will be. They’re not using their noggins here. And not for the first time.
Right now if you take a loss in a stock of fund, you can only write off $3,000 a year of it. So if you had a $21,000 loss, it would take 7 years to write it all off.
If you are taking losses you shouldn’t be in the market.
Stolen elections have consequences.
As Bannon says, catastrophic consequences.
Too many still do not understand that.
29:12 A prince that gladly heareth lying words, hath all his servants wicked.
Obama often used the phrase “spending in the tax code”.
He believed everything you earned belonged to the government, but they let you keep some of it. Kind of like slavery.
Nearly everybody in DC thinks that way. You hear them all the time talking about “paying for a tax cut”. As if it’s all theirs!
The “squad” must be loving this asinine idea.
Let’s break it down for, oh, I dunno…………..maybe a bartender. Let’s say “Sandy” the barmaid sells $40 worth of drinks and she’s expecting a 20% tip. She’s worked hard don’t you know……mixin’ those cosmos.
Good ol’ Uncle Sam sends Sandy a tax bill based on her current sale of martinis. But wait! The deplorable decides to stiff Sandy and leaves zip, zero, nada. But guess what? Sandy still owe income tax on the eight bucks she never earned after all!!! Geez, that’s so not fair.
That my friends, is the economic lesson that the wealthy Mrs. Yellen and Lessgo Brandon are proposing.
They love the idea and propose it because THEY don’t fear us.
This governance abomination ends when THEY walk softly in hopes not to awaken our wrath.
Sell your house to your cousin and he sells his house to you, both at actual value. Then reverse that and each of you buys back his house for $1000 less.
Just wait ’til we get digital money that can incorporate negative interest! Thirty five trillion dollar deficit doesn’t look so bad then. Plus you lose money you never held in your hand! Everything will be plastic!
When the value goes down do we get a loss to off-set the gains, Nooooooo. One way IRS.
Do we still have to pay the capital gain when we sell the house. Of course.
This is commie unreality finance, but take it seriously because the wash-sale system eliminating valuable losses in a very arbitrary manor has already been in place for years.
So anyway you print it, the irritating rat suckers are still a bunch of conniving, evil thieves?
80M votes for Lessgo Brandon? A democrat mandate on all of these kooky ideas?
Don’t think so.
INFLATION – by feral reserve (sp) money printing is the ” hidden ” tax.
The Creature From Jekyll Island – A second Look At The Federal Reserve : G. Edward Griffin
( Seek and find authors many great and easy to understand talks … they’re everywhere)
See documentaries:
Bill Still’s The Money Masters
James Corbett’s Century of Enslavement- The History of the Federal Reserve
Book: Ellen Brown’s Web of Debt
I’m employed by rich people. They can do without their private jet. I, however, cannot do without a job.
This is not a bug, it’s a feature.
This is such a shell game. And how many people don’t see it as such.
This is as close to outright “gimme your money and starve” as you can get.
This is near the top of the things that make me ready to lay what’s left of me down.
I see nothing wrong with taxing the rich and the super rich on their wealth. Do you realize the top 1% own more of America’s assets than at anytime in our history? Or that’s its been on an upward swing for the last 30 years with no sign of stopping. Sorry, why can’t people understand the difference between average people, (or even above average people) who have $1 million in assets, and someone who has $1,000 million or in Bezos case 200,000 million.
we used to tax rich people very heavily from 1933-1973, which is exactly when the USA had its greatest percentage of wealth increase. If you’re a member of the super-rich, Hey, I can understand you being upset. If you’re one of 95% who isn’t, I can’t understand the anger. Anyway, defending Rich Billionaire Hollywood Producers and Silicon Valley execs isn’t going to get “Conservatives” anywhere. They’re with the Left.
So the more successful an individual is, the less of his product/profit he gets to keep?
Sounds like some kind of equity at work: I guess since what I “got to keep” over the decades of working for a paycheck seldom amounted for more than $30,000 at the most, we could set that as a target.
No millionaire or billionaire will ever get to keep more than $30,000. Should do wonders for the employment market. I didn’t graduate with an economy degree like Sandy-the-bartender, but even I suspect that there wouldn’t have been anyone in a position to hire me if that had been the way things worked.
Seems like you don’t really understand the fallacies of this scheme. It is an our-and-out scam. They are desperate to create an us vs. them division. In reality, only the government wins.
The government makes the rules to ensure only IT wins.
Its either going to be
#cancelcitizens
Or
#cancelgovernment
We are becoming subjects rather than citizens.
And on our way to becoming slaves in their new digital gulag.
Not easy to simply Tax the Rich when it’s these super wealthy that are writing the tax codes. Note that there’s always a loophole in there somewhere that makes it possible to avoid paying most, if not all taxes. Used to be that the incentive to not pay heavy taxes was to reinvest into the businesses that created the wealth in the first place. Business expands and this leads to more jobs. See the old adage about a rising tide raises all boats. Now we see the rich simply taking there gains to off shore tax havens where nobody benefits. The issue is not to increase the amount of tax collected. The issue is government spending that’s driving down the value of the dollar earned. When my dollar earned approaches a value of zero then so does the value of my labor. At this point I am not much more than a worthless slave.
Two things:
To your point about not understanding the difference between the “average” person and super rich, that just shows you haven’t been paying attention the last 70 years. Every F’ing time we appease these tyrants they abuse the inch we give. In a Utopian society, surrrre, let’s do this crap. With Joe Biden and Xi/Soros/Rothchild running the show… F THAT.
By the way, you do realize those uber rich people are the one’s backing all this. That means their loophole is already built into the plan. And before you know it, $200K per year is the new SUPER RICH!!!
Wake up
Covid: Phase One
BLM Riots: Phase Two
Vaccine Mandates: Phase Three
Tax Plan: Phase Four
More nightmares to come: Climate Change Compliance (we’ve heard Compliance a lot lately)
It’s the Small Business/American Dream/ Middle Class Purge. Pile on Rent Moratoriums to attack how average people can work hard and build wealth. Homes and small business are about all that’s left to us
Ever think that the SSA is butting heads with all those booming boomers retiring. Thus the clot shot to take down the elderly? Might just realize they will run out of funds in a few years!
Even if you took 100% of the wealth of anyone who has a net worth over a billion dollars, you’d still not have the money to run the country for a year. Yes, the US government spends THAT much. That’s why we’re trillions in debt.
That’s why they’ll turn their sights larger. You can’t have a middle class in the communist reset
Ten years ago, Bill Whittle posted the following video illustrating your point in this Firewall episode:
“Eat the rich”
Im retired, live within my means, and Im debt free. If it were all to go away tomorrow, so be it. I love my Lord and Savior Jesus Christ, and no one can take that away from me.
F the whole mess.
Let’s go Brandon…..
F— Joe Biden!
#FIFY
Yep just say what you mean! Just simple President Trump plain talk!
There is no such thing as an increase (or decrease) in value of possessions. In fact there is no such thing as seller value — only the buyer can set the value — and it is the highest price somebody is willing to pay at the present time. Your house can be worth $1 today and $100 tomorrow based on similar real estate transactions but if when you sell the highest price you can get is 50 cents, then you lost value on your investment because the buyers in the market didn’t want to pay the price.
There is no way an economy of a free people can withstand the government determining asset value and taxing you based on their arbitrary dictats.
“Indeed, if you tax some unrealized gains, you could in extreme cases force people to sell assets like a home to pay the tax on income that they did not make.”
that would be my situation exactly.
a long held family home would have to be sold to pay the appreciation,
leaving me homeless and a nice property on the market.
almost like that’s the plan….
Welcome to your free, government housing in the blue city near you. Agenda 21, Agenda 2030.
“Almost like that’s the plan..”
C’mon man!
Klaus Schwab of the World Economic Forum predicts ‘you will own nothing -and be happy’
“…or else.”
Thin edge of a VERY Thick Wedge…
Hope when my house is seized by the IRS I’ll be able to rent it back from the CCP. I’d rather not move all my shop tools. And I just finished building a pizza oven.
The shop tools would be a major problem in our house as well. My husband’s collection probably resembles yours.
Heh, my historical place has been a manufacturing facility for close to 40 years. Worked at home long before it was stylish. Learned the big boy tax loopholes and applied them to poor boy life.
Impressive discussion, members here hit all the salient points. I think we know where this is going so take the information and move forward. We have a lot of leverage. Get into the founding father’s mindset and shove off. The enemy is only human.
The enemy human??? I’d debate you on that one?
Mortal might have been a better word choice, heh. I believe there was a movie line on my mind when I posted that. I had to wrack my brain a bit but believe it came from the movie ‘Matrix’.
Ironically, there’s a lot of that movie out in the real world these days, from the Communists turning us into batteries to any ‘citizen’ in the matrix being a potential agent of the machine. On and on.
What you say is true. Spooky even. Life imitating art in a manner of speaking. I believe Schwab and Co have been watching too many of these movies.
I hope everyone in America is getting as sick as I am of hearing Build Back Better.
Break (your) Back Better.
If one can understand the difference between dynamic and static then Marxism completely falls apart. Thus this fundamental reality must be ignored. Everything the far left, which has completely engulfed the democratic party and its followers, believes and pushes as talking points depends on a static world that can be sliced and diced any which way we vote. Problem is that takes time and time is not part of their equation and must be dismissed as irrelevant.
The watchmaker has time up his sleeve
The hours tick away
They tick away
Evil.
In a nutshell.
Biblical, even.
Whenever Bolsheviks come up with a plan to “tax the rich” somehow it always bites me in the arse. And wallet.
“tax the rich”
Selectively.
Bill Gates,
Mark Zuckerberg, Jeff Bezos, et al, not included.
I am a long way from being a Billionaire! I live on my company retirement pension and Social Security. My house has appreciated quite nicely since I purchased it in 2011. I sure as hell don’t want to pay taxes on that annual appreciation. This is nothing more than pre payment of the death tax that President Trump did away with with his tax cut. They can’t wait for us to die and bankrupt our hairs! They want it up front before we pass.
The banks are going to own a lot of real estate if this goes through! Oh, and not to mention a lot of Stock Market holdings!
Second thought: At present capital gains on a primary residence is tax exempt. This maneuver will allow taxing assets never before taxed. Billionaire BS! this is aimed directly at all homeowners. I’ll rent!
Exactly. My late husband and I bought the house I live in for $84,000 in 2011. It’s present estimated value, based on current home sales in my area, is between $250,000-$300,000. I couldn’t either pay the tax on the “unrealized gain” or sell it and buy somewhere else without doubling or tripling my payment….a nonstarter.
For most average people, particularly those who don’t live in one area for decades, gains on sale are largely exempt, the 250/500K gain exemption covers most cases.
However, in high value real estate areas it may not. Also, federal and state rules can vary.
One way to avoid federal taxes is to be ‘poor’ in the year of sale, if not otherwise covered by the exemptions. That may not affect state taxes. See the cap gains tax tables for more info.
Lastly, since many people these days are working from home, beware of recapturing depreciation if taken as a business/work expense when selling. It gets subtracted from the home’s basis.
Very complex subject and IMO this proposition of taxing unrealized gains will end up opening another layer of bureaucracy on the taxpayer dime, expending government and, as many have mentioned, will eventually hit the middle class even if it starts with the wealthy. The lure of free money under color of law is simply too lucrative for government humans to ignore. History has proven this.
God be with us.
That’s what they WANT us to do! “You’ll rent everything and own nothing, and you’ll be happy”…
Also it won’t touch the billionaires, it’ll be aimed at us.
I was witness to a recent divorce case. The husband was the son of a billionaire. Examination of numerous trusts and tax filings disclosed that his billionaire father did not pay one dime in city, state or federal taxes.
Woe. Great way to stick it to the Middle Class. And the Realtors assoc. will go right along with it and pump the news that “house prices are going up” for the Pols.
New “Let’s Go Brandon” release today. This one includes talking points.
If they’d waited til tomorrow to release, they could’ve added this newest one.
I am surprised that this took so long. With 28 trillion of debt, we are already “taxing” the wages of persons who have not even been born.
Indentured citizens from the very first breath…
Assuming they Allow a first breath…
the crimals that stole the election are now
targeting our assets next.
its past time to form our own posse and enforce the constitution ourselves
an unrealized capital gain is not a capital gain, since it has not come into existence yet, if ever.
taxation is theft and the biden regime is illegal and illegitimate.
“…Why stand we here idle? What is it that gentlemen wish? What would they have? Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery?”
This plan all but fell apart today. At least for now.
OK, but this was so egregious and transparent, what was the other hand doing while we were responding to this Crap?
Eric: Link? Source?
Obviously the Laffer curve is not a factor in this.
A scheme to abolish private property more so than to gain appreciable revenue.
The value of your “stuff” would increase every minute of every day.
Ho-ho-ho.
Merry Christmas everyone.
The elite will work their way around this…unlike the small investors, IRA and 401k holders who would bear the burden of such taxation.
As intended.
Only the financial and political elite deserve to be economically secure.
The rest of us must be wholly dependent upon government.
We will own nothing and be happy.
The Democrats can really be imaginative when it comes to new ways to tax people to death. Several years ago Limbaugh was telling about a scheme they had come up with to tax you on your house even if it was paid off. They would check to see what the average house payment or monthly rent was in your area and multiply that times 12 to say you had “imputed income” of that amount that you owed taxes on.
e.g. If the average house payment in your neighborhood was $2000/month and your house was paid off, you’d owe Federal income taxes on $24,000 of imputed income. They were saying it wasn’t fair that others were paying house payments and you were not.
They are truly evil.
taxation on inflation
Add in financial repression, it is especially destructive for those on fixed incomes. And I mean seniors.
Nothing they want more than pesky conservative seniors DEAD.
Nothing truer.
Taxation causes inflation.
Inflation increases taxation.
Repeat.
One wonders how the US of A made it all the way from 1776 to 1913 without a Federal income tax. Which started at 1% of course and was “never going to go higher than that”. Yeah.
Washington DC wasn ‘t bloated by many alphabet agencies before 1913.
The fed discovered a good scheme when they saw the income tax revenue rolling in. It had to be broadened for DC to grow.
The next best federal revenue enhancement scheme was income tax withholding from pay.
Build DC Better.
And keep it growing!
Here’s a good video on the Federal Income tax and the Federal Reserve:
Aaron Russo’s America Freedom to Fascism
https://www.bitchute.com/video/HXx6oWdIHvgr/
At 2:08 he shows a quote from US District Court Judge James C. Fox saying that the 16th amendment was never ratified by a sufficient number of states.
This gets you more quickly to YOU will own nothing and be happy!
Those who can afford to always ALWAYS find work arounds.
The plebs…us…no chance. We will forever be the ones that are caught in the nets.
I saw a tweet somewhere today from some lowlife Dem senator…the repulsive Wyden I think…who said primary residences would NOT be included.
Do I trust that? Absolutely not.
We been paying taxes on taxes on top of taxes there will be end to it.
Who is gonna stop them??
The $64,000,000,000 question, isn’t it?
Every day I see what Biden and Co. have done and think “it can’t possibly get any worse”. And yet it does. They seem utterly determined to destroy the US completely. I can’t conceive of that level of stupidity.
“It can’t possibly get any worse.”
To which Biden and Co. say,
“Hold my ice cream!”
So much damage in under a year, with three more to go under Biden and his successor.
Guaranteed to get much, much worse.
Growing up…I always thought what the King of England did to the colonies was something that happened historically. That people today would never do those kinds of things. Same with the actions of Nazi Germany. These were lies I told myself despite growing evidence(psychological experiments like the Milgram experiment) to the contrary. Now I see it full on. These are not historical enemies. This is the same evil that was stopped in 1776. It has never left. It has been fighting to destroy us ever since. I am convinced at this point that if a leading Leftist said: “We need to kill these Trump Supporters by lethal injection in order to stop the spread of racism and Covid-19 in this Public Health Emergency. This is for the improvement of Society.” that 90% of those voting Democrat today would go along with it and support it. While disturbing to realize…we must realize it. We must take back schools, education, corporate control of information, health agencies. I don’t know what that process looks like…but I am doing my best to prepare for the ultimate and inevitable complete societal breakdown ahead. I do it with a smile on my face. Because they will never win. They may win the outside world, but they will not within me.
The average American colonist paid 1/10th the taxes paid by the English. After fighting the Seven Years War in Europe and the F&I War her England was broke. The English spent blood and treasure defending the Colonies from the French and Indians. Thousands of Redcoats died in battle on American soil and the taxes levied here were to help offset some of the debt. It was a fair tax and we were ungrateful!
Might have been fair in theory, but not when the colonies had no say in the direction or decisions of government. It wasn’t that the tax wasn’t fair, it was that it was without representation.
Hopefully your are being sarcastic.
The IRS will have to hire many more people, and the more corrupt, the better.
WEF: “Welcome to 2030, where you will own nothing and be happy”
I’m sure they have war-gamed all of this out and know exactly how they are going to bankrupt the American people.
Can I get a tax credit for having unrealized children?
Oooooo good one.
?
This wealth tax is in addition to the minimum global tax of 15% Biden is in favor of
https://www.cbsnews.com/news/global-minimum-tax-rate-15-percent-biden-administration/
Some years ago (when the budget was only $3.5T), Bill Whittle did a video on taking the wealth and revenue of all the billionaires and corporations to pay that year budget. Fascinating to watch.
?
They always announce ther ultimate intentions. Believe them.
The Marxists want to count their chickens before they are hatched. They want to pay Paul before they have robbed peter. They want to spend money before it is printed. LOL They want a receipt for money they didn’t pay. These Gadianton Robbers and their new math are Insane !!
Can’t be true…
I HEARD the president say his $3.5 trillion spending bill will not cost anything!
Wait…then he claimed that the bill would pay for itself by taxing the hell out of the rich…
And now he’s proposing a tax on something that doesn’t actually exists.
Soon we’ll have to pay a “fee”, or “upcharge”, or “surcharge” or whatever they call it on our “potential future earnings”!
Your child will be born with a huge tax debt before they even begin to breathe!
At least maybe then they’ll outlaw killing preborn children because it reduces “anticipated revenue spending levels”.
It’s yet another way that they can hurt Donald Trump.
Imo their huge spurt of radicalism is because he scared the bejeepers out of them.
With they way they have been able to manipulate the economy over the past 60 years they could make the value of your assets whatever they want.
Family Farmers and Main Street small business and home owners will be wiped out by this
Most MLB,NFL,NBA etc. are purposely, not profitable along the way, but can be valued at 100 million plus. Tickets and beers are going to get really expensive.
That is exactly the intended outcome.