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| ▲ | verteu 5 days ago | parent | next [-] | | True, though it's irksome how the chart conflates "Rich" with "High taxable income." These are not the same, which is exactly the problem! eg: The #1 most wealthy American is Larry Ellison, whose net worth increased $89B today with zero tax implications. | | |
| ▲ | tracker1 5 days ago | parent | next [-] | | What do you think should happen to you if your house is more valuable in a year than the year before, even if you aren't selling or otherwise leaving that house? | | |
| ▲ | verteu a day ago | parent | next [-] | | Probably nothing. It seems quite reasonable that unrealized capital gains would be treated differently for "a primary residence" vs "a multi-billion-dollar stake in a company controlled by the owner." A far better question is: Why does my company pay me in cash (40% marginal tax rate) instead of "equity shares of 'special partnership units' representing the value added by verteu's labor" (20% capital gains tax)? Or: "How did Mitt Romney's Roth IRA grow to $100,000,000 with a $7,000 annual contribution limit?" | |
| ▲ | a day ago | parent | prev | next [-] | | [deleted] | |
| ▲ | a day ago | parent | prev | next [-] | | [deleted] | |
| ▲ | happyopossum 5 days ago | parent | prev | next [-] | | This varies wildly depending state you live in - some states adjust property taxes for current value, some don’t (or do but with severe limits) | | |
| ▲ | tracker1 5 days ago | parent [-] | | But do they do income-like taxes on the added value? This seems to be what people (GGP) are wanting from the increase in stock values, ie, unrealized capital gains.. which is frankly terrifying. | | |
| ▲ | ambicapter 5 days ago | parent [-] | | They increase property taxes, so yeah, you're getting taxed on a capital gain that you haven't realized yet (and won't until you...sell your house). | | |
| ▲ | tracker1 5 days ago | parent [-] | | What do you think should happen to people's retirement accounts each year then? | | |
| ▲ | triceratops 5 days ago | parent [-] | | Nothing. Retirement accounts are tax deferred or tax free. What a weird question to ask. | | |
| ▲ | tracker1 4 days ago | parent [-] | | Well, if you want to tax the stocks that the wealthy own.. why wouldn't you want to tax the stocks that many regular people own? Where do you draw the line between the two? | | |
| ▲ | triceratops 4 days ago | parent [-] | | Wealthy people's stock in retirement accounts would also not be taxed. This can be considerable: Peter Thiel's Facebook investment was made in an IRA. I imagine there'd be some net worth number, excluding retirement accounts, that policy wonks could work up. You draw the line between "wealthy" and "regular" there. Or, more likely, several lines because there would be wealth brackets similar to income brackets. Without that it would be a regressive tax. | | |
| ▲ | tracker1 4 days ago | parent [-] | | Why not just tax when someone SELLS the stock, or leverages it for a loan instead? You know, when they actually use it? I'm actually against property taxes, or any kind of tax where you risk losing property just because you managed to live another year. | | |
| ▲ | triceratops 4 days ago | parent [-] | | I don't disagree with that. But it's a much bigger discussion. Abolishing all property taxes means city and county finances need fundamental re-working. |
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| ▲ | triceratops 5 days ago | parent | prev [-] | | I know what does happen. Property taxes go up. A wealth tax by another name. |
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| ▲ | twoodfin 5 days ago | parent | prev | next [-] | | Capital gains absolutely have tax implications. Just like my house rising $100K in (unrealized) value over a year. | | |
| ▲ | cherrycherry98 5 days ago | parent [-] | | Capital gains receive favorable treatment under US tax code but are also a realized gain by definition. That is you actually have to sell the asset and are taxed based on any profit earned. An increase in the estimates value of your real estate holdings does not trigger a capital gain. Your municipality, however, may use it as an excuse to increase their assessment of the value of your property, which is used to calculate the tax they charge. | | |
| ▲ | triceratops 5 days ago | parent [-] | | So you admit that many people do pay unrealized gains taxes on their largest asset (their house)? | | |
| ▲ | cherrycherry98 5 days ago | parent [-] | | Yeah it functions like a wealth tax, but the claim was that it was a capital gains tax, which it isn't. |
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| ▲ | cherrycherry98 5 days ago | parent | prev [-] | | His net worth increased due to asset appreciation. Nobody physically transferred him any money and it can fall back down tomorrow. Should he get a refund if Oracle stock tanks? | | |
| ▲ | verteu a day ago | parent | next [-] | | > Should he get a refund if Oracle stock tanks? Presumably it would function the same way as realized capital gains taxes (no refund on tax already paid)? | |
| ▲ | triceratops 4 days ago | parent | prev [-] | | He pays less next year because Oracle stock is worth less. Just like property taxes on people's houses. The math on taxing unrealized gains or losses doesn't work out for the reasons you pointed out. Property taxes, on the other hand, have been working for a long time. |
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| ▲ | triceratops 5 days ago | parent | prev [-] | | That doesn't answer the question I posed. First off it conflates "high-earning" with "wealthy". Plenty of early career doctors are high earners but have a negative net worth. They pay more taxes than someone with millions in net worth but lower "income". Secondly, just because the median earner pays a 2% average income tax rate while the top 1% pays on average 21% doesn't tell us anything about its fairness. It ignores income share. |
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