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Dear Toppy, NO ONE is saying a shift of the tax code to the flat tax would be EASY. We are discussing the MERITS of the flat tax.
Thanks.
Capital gains & income averaging.
- Thread starter Supposn
- Start date
Dear Toppy, NO ONE is saying a shift of the tax code to the flat tax would be EASY. We are discussing the MERITS of the flat tax.
Thanks.
Supposn wrote:
LTCG sales transaction is a pretax transaction; (i.e. the profit from that sale were not previously taxed) there’s no logical reason that sales income should not be taxed and taxed at the regular rate.
Respectfully, Supposn
Dixie wrote:
Again, there IS a reason, I explained it earlier with an analogy about a charter bus to NY. A wealthy capital investor has absolutely NO reason to take a risk with his money and invest in some new venture, if the reward for doing so is going to be taxed the same as income. There are many less risky ways for the wealthy person to utilize their assets, and probably even make more profit with less tax liability. Now we can chew the fat on this as long as you like, and we can ponder and pontificate on our respective viewpoints, but all we need to do is look at the current situation in our country, the reality of our current tax policies, and how they have affected investment the past 20 years or so. It's hard to argue with reality.
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Dixie, USA does not lack sources of funds that could be invested within our nation.
Both the foreign and USA’s business persons participate within our financial markets and transfers of wealth because they sense some opportunity to profit from shuffling their stocks and bonds portfolios. USA’s tax reductions for LTCG has not significantly increased numbers and amounts of stock market transactions.
Potential investors do not expect satisfactory return on investments for new ventures. Regardless of the extraordinarily reduced tax rates applied to LTCGs, the probability and expected return from more risky ventures do not justify so many of the ventures that have been considered.
You and some other members of this group are proponents of further reducing taxes upon LTCGS.
I advocate improving out commercial environment:
Throughout of our nation there’s infrastructure projects that would fully justify government’s investments. I advocate our government invest in to our own nation.
I advocate replacing the reduction of taxes for LTCG which is economically net detrimental with was the more populist and economically advantageous income averaging.
I’m a proponent of a proposal to reduce USA’s trade deficit of goods that was first introduced to the Senate in 2006. The self funding proposal would increase our GDP and the sum of USA’s aggregate imports plus exports. All net expenditures would be paid by U.S. purchasers of foreign goods,
Refer to “Reduce the trade deficit; increase GDP & median wage”
posted at 7:54Am, April 20, 2011.
Respectfully, Supposn
LTCG sales transaction is a pretax transaction; (i.e. the profit from that sale were not previously taxed) there’s no logical reason that sales income should not be taxed and taxed at the regular rate.
Respectfully, Supposn
Dixie wrote:
Again, there IS a reason, I explained it earlier with an analogy about a charter bus to NY. A wealthy capital investor has absolutely NO reason to take a risk with his money and invest in some new venture, if the reward for doing so is going to be taxed the same as income. There are many less risky ways for the wealthy person to utilize their assets, and probably even make more profit with less tax liability. Now we can chew the fat on this as long as you like, and we can ponder and pontificate on our respective viewpoints, but all we need to do is look at the current situation in our country, the reality of our current tax policies, and how they have affected investment the past 20 years or so. It's hard to argue with reality.
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Dixie, USA does not lack sources of funds that could be invested within our nation.
Both the foreign and USA’s business persons participate within our financial markets and transfers of wealth because they sense some opportunity to profit from shuffling their stocks and bonds portfolios. USA’s tax reductions for LTCG has not significantly increased numbers and amounts of stock market transactions.
Potential investors do not expect satisfactory return on investments for new ventures. Regardless of the extraordinarily reduced tax rates applied to LTCGs, the probability and expected return from more risky ventures do not justify so many of the ventures that have been considered.
You and some other members of this group are proponents of further reducing taxes upon LTCGS.
I advocate improving out commercial environment:
Throughout of our nation there’s infrastructure projects that would fully justify government’s investments. I advocate our government invest in to our own nation.
I advocate replacing the reduction of taxes for LTCG which is economically net detrimental with was the more populist and economically advantageous income averaging.
I’m a proponent of a proposal to reduce USA’s trade deficit of goods that was first introduced to the Senate in 2006. The self funding proposal would increase our GDP and the sum of USA’s aggregate imports plus exports. All net expenditures would be paid by U.S. purchasers of foreign goods,
Refer to “Reduce the trade deficit; increase GDP & median wage”
posted at 7:54Am, April 20, 2011.
Respectfully, Supposn
Dixie - In Memoriam
New member
Where did I say we lacked sources? I said the sources are not motivated.
Many capital investors are not the least bit interested in the stock market. You see, you are falling into the trap of the leftist rhetoric, that all wealthy people are out there trying to make profits and increase their wealth. I am asking you, WHY does a rich person NEED to increase their wealth???? The answer is, a RICH person, DOESN'T need to increase their wealth, or make profit. They already did that, it's how they became RICH! Now.... IF there is an OPPORTUNITY for them, which could benefit them significantly with relative risk, they may or may not take it... the bottom line is, they aren't going to invest if the conditions are not optimal, because rich people tend to be smart that way.
Most high-level industrial and manufacturing investors know and understand it will take a period of time to get ROI, that's not the issue. Many times, they are moving money from a security or trust, where it then becomes a capital gains asset, and subject to taxation. There is no incentive for the investor to move the money out of a secure sheltered and risk-free environment, to be devoured in taxes and financial regulatory fees, or whatever. It's easier for the wealthy person to do nothing....maybe when things turn around a bit?
I personally think we should eliminate capital gains tax, estate tax, and corporate tax entirely. Replace the income tax with a national sales tax, and I am happy. Our government needs to start operating on what we take in, and stop trying to punish economic performance and success. We need to END the class war, and adopt a system where we ALL contribute equally, and ALL have skin in the game. Consumption tax is the ONLY way to do that.
Then you should support elimination of capital gains taxes and corporate taxes.
The more you tax something, the less of the activity you can expect.
This is not the federal government's function or purpose! Infrastructure projects are the responsibility of the people and their state, not the federal government.
One has nothing to do with the other! If we are going to continue to have income taxes, we need to have income averaging, and no cap gains taxes. You can't make determinations on economics of the unknown, you have no idea how much income tax revenue would be generated if we eliminated the capital gains tax!
Huh? You've lost me now. The trade deficit is a completely different matter, but I would think any sincere plan to reduce our trade deficit, would have to involve increasing our exports, which requires capitalist investment.... presently stifled by cap gains tax rates.
Who's interested in the stock market?
Dixie, I’m not personally acquainted with anyone that’s extremely wealthy but I have and am acquainted with some persons that are very far from poor.
These are not stingy people but if we should hear coins drop to the floor they’d be among the very first to stoop and pick the coins up. Their need or lack of need for money is not their entire motivation but thus far I haven’t encountered one adult among them that wasn’t interested in the stock market.
I’m not privy to their decision but from what’s been observed, those who can afford to play do not drop out of every deal that’s less than an optimum prospect.
Actually optimum prospects are sufficiently so rare as to be practically non-existent.
Logically wealthier persons can afford greater risks if the probability of success and the expected return on investment justify undertaking the risk.
I repeat that the wealthier people seem to be among the very first to stoop and pick loose change off of the floor.
Respectfully, Supposn
Dixie, I’m not personally acquainted with anyone that’s extremely wealthy but I have and am acquainted with some persons that are very far from poor.
These are not stingy people but if we should hear coins drop to the floor they’d be among the very first to stoop and pick the coins up. Their need or lack of need for money is not their entire motivation but thus far I haven’t encountered one adult among them that wasn’t interested in the stock market.
I’m not privy to their decision but from what’s been observed, those who can afford to play do not drop out of every deal that’s less than an optimum prospect.
Actually optimum prospects are sufficiently so rare as to be practically non-existent.
Logically wealthier persons can afford greater risks if the probability of success and the expected return on investment justify undertaking the risk.
I repeat that the wealthier people seem to be among the very first to stoop and pick loose change off of the floor.
Respectfully, Supposn
Dixie - In Memoriam
New member
You said it all right there... IF the probability of success and expected return justify the risk. Capital gains taxes factor AGAINST return and success, and make the risk not worth it. That is the whole point here. We can't expect to make it LESS attractive for a capital investor, and yet he is still going to take the risks... it doesn't work. Oh sure, some really greedy people may try to exploit some opportunity to make a buck, that's going to always happen, in good times or bad. But the kind of spontaneous economic growth and job creation we need, is just not going to happen in this environment. We have to ENCOURAGE investment, not discourage it with more taxation. We need to be APPLAUDING capitalist investment and finance, not morphing it into some kind of mythical boogey-man or source of all evil in the world. The people who have the kind of capital to get us out of the mess we are in, are currently being pelted with tomatoes and told they are a bunch of crooks and thieves, and don't pay their fair share! How fucked up is that?
USFREEDOM911
MAKE AMERICA GREAT AGAIN
I know a family who used to be farmers.
The older couple lived through the depression, worked that farm and made it productive enough that their two sons were able to live on the farm and work with them.
A company had been after them for years, to buy the land from them for housing development; but the father wanted to continue farming.
After a few years, it got harder and harder for the farm to make a profit and eventually they sold the farm to the company, for a really good chunck of change.
One of the sons took his mother shopping and she was still buying dented cans; because they're cheaper.
So maybe, people who are picking up that change got rich; because they learned early on that while a penny is only worth 1 cent, 100 of them make a dollar.
Shifting security investments W/tax due to appreciated value,
If a potential enterprise doesn’t promise sufficient profit, is not a particularly good reason to subsidize the enterprise.
The second factor you describe, (taxes that would be due upon cashing in an on a security) could have been avoided by two methods that come to mind immediately.
The major assets of middle income earners, (if they have appreciable net assets), are their homes and their tax deferred retirement funds). Some middle income earners are self- employed and own their enterprises. If cash were needed to the needed for an investment that qualified as a tax deferred investment, there’d be no tax consequences from selling one of their deferred investments to purchase a more attractive investment.
I digress to note that that tax considerations are of little advantage to owners of tax deferred funds.
Rather than selling a security, an investor could use it as loan collateral. I’m not thrilled with that remedy. If you use a volatile security as collateral, you’re vulnerable to margin calls.
Respectfully, Supposn
If a potential enterprise doesn’t promise sufficient profit, is not a particularly good reason to subsidize the enterprise.
The second factor you describe, (taxes that would be due upon cashing in an on a security) could have been avoided by two methods that come to mind immediately.
The major assets of middle income earners, (if they have appreciable net assets), are their homes and their tax deferred retirement funds). Some middle income earners are self- employed and own their enterprises. If cash were needed to the needed for an investment that qualified as a tax deferred investment, there’d be no tax consequences from selling one of their deferred investments to purchase a more attractive investment.
I digress to note that that tax considerations are of little advantage to owners of tax deferred funds.
Rather than selling a security, an investor could use it as loan collateral. I’m not thrilled with that remedy. If you use a volatile security as collateral, you’re vulnerable to margin calls.
Respectfully, Supposn
Governments' functons?
Supposn wrote:
Throughout of our nation there’s infrastructure projects that would fully justify government’s investments. I advocate our government invest in to our own nation.
It’s contrary to conservatives’ positions but I prefer a big government that works rather than a small government that doesn’t.
I regret that by subsidizing only new or reconstructed roads, tunnels and bridges, the states permitted their existing infrastructure to decay. Bridges require replacement because the states didn’t repaint them. A dime could purchase a dime’s worth of paint or a dollar’s worth of subsidized roadway.
But if the Eisenhower administration hadn’t done it, we still wouldn’t have a national road system.
The federal government promoted the cross continent railroad and it came into existence.
I doubt if we’ll have high-speed trains until the federal government promotes it.
I’m not unconditionally devoted to any single concept. Judgments of valid but contrary concepts and principles as they affect any issue must be weighed. Every proposed or existing law or regulation must be justified upon their own merits.
Respectfully, Supposn
Supposn wrote:
Throughout of our nation there’s infrastructure projects that would fully justify government’s investments. I advocate our government invest in to our own nation.
It’s contrary to conservatives’ positions but I prefer a big government that works rather than a small government that doesn’t.
I regret that by subsidizing only new or reconstructed roads, tunnels and bridges, the states permitted their existing infrastructure to decay. Bridges require replacement because the states didn’t repaint them. A dime could purchase a dime’s worth of paint or a dollar’s worth of subsidized roadway.
But if the Eisenhower administration hadn’t done it, we still wouldn’t have a national road system.
The federal government promoted the cross continent railroad and it came into existence.
I doubt if we’ll have high-speed trains until the federal government promotes it.
I’m not unconditionally devoted to any single concept. Judgments of valid but contrary concepts and principles as they affect any issue must be weighed. Every proposed or existing law or regulation must be justified upon their own merits.
Respectfully, Supposn
Dixie - In Memoriam
New member
Who's talking about subsidizing? We're talking about whether or not to charge a tax on investment. It's not a subsidy if we don't charge the tax, that's playing loose with the definitions here.
In the case of capitalist investment, we need to do all that we can do to encourage it, and all we can do to prevent discouraging it. It's really that simple, whether you are jealous of rich people or not, whether you are paranoid that rich people are going to screw the little guy out of all his money... it doesn't matter, if we don't encourage and promote capitalist investment, we won't have any.
Okay, why are you telling me about what middle income earners can do, and what do tax deferred investments have to do with capital investments? Most of these are done by groups of very wealthy people, but when you have an environment where the money is subject to capital gains tax, these groups of investors are harder to come by, they prefer to keep their money in secure tax deferred bonds or whatever. It seems as if you are still trying to find some way to justify raising the cap gains taxes, even though you know it is contrary to everything that makes sense.
It is pointless for us to say, "wealthy people will do this or won't do that..." They are as different as you and I. But one thing is for certain, the kind of wealthy people who tend to invest in the financing of new enterprise, aren't motivated at this time. An objective analysis of why, has to include capital gains tax rates. We must also consider the reason we aren't seeing a lot of growth in manufacturing, has to do with the corporate tax rates, which are some of the highest in the world. In both cases, the private investors and financiers, as well as those who seek to start a corporation, are more inclined to do so in another country, where there is no capital gains or corporate tax, and usually has cheaper labor anyway.
Did you know, we have something like $4 trillion in American wealth, invested in other countries. They can't bring it home, it's subject to cap gains tax if they do. Imagine what an economic boon we would have, if we eliminated the cap gains taxes, as well as the corporate taxes? Every corporation in the world would want to locate here... hundreds of billions of foreign investments would return to our country and go to work here, providing jobs, economic growth, prosperity.... and ironically enough, more income and sales tax revenues.
zero chance, apparently you like pissing in the wind. I don't
Long term capital gains and Income averaging.
Long term capital gains and Income averaging.
Dixie, the long term capital gain tax reduction favors one classification of income, or business model, and unjustifiably shifts greater portions of our tax burdens upon all others.
I do not contend entrepreneurs choosing to reinvest and nurture their enterprises are of greater economic benefit, but it’s not of lesser benefit than cashing out of the enterprise. The capitalist system is based upon such determinations be market determined. Reductions for sales of non stock-in-trade items continuously owned by the sellers for a year or more are certainly government subsidies of such sales. The government is favoring a particular business model.
The liquidity of our nation’s financial markets is of lesser economic benefit to our nation. Sales of goods and services rather than transfers of wealth contribute to our nation’s GDP. (GDPs in turn support nations’ median wages).
The vast instances and amounts of sales transactions classified as qualifying for Long term capital gains, (LTCG) tax reduction are transfers of wealth rather than goods or service products.
Only a portion within the minority of sales transactions qualified as LTCG, are capital goods. If as you contend the purpose of LTCG tax reduction is to promote USA’s capital investment, it fails to effectively accomplish its purpose.
LTCG tax reduction is a tax inequity that decreases tax revenues and increases the federal deficit.
I advocate replacing LTCG regulations with rewritten and renacting “income averaging" tax provisions. It would actually accomplish everything that the LTCG provisions promises, it would do so in a more populist and superior manner.
Respectfully, Supposn
Long term capital gains and Income averaging.
Dixie, the long term capital gain tax reduction favors one classification of income, or business model, and unjustifiably shifts greater portions of our tax burdens upon all others.
I do not contend entrepreneurs choosing to reinvest and nurture their enterprises are of greater economic benefit, but it’s not of lesser benefit than cashing out of the enterprise. The capitalist system is based upon such determinations be market determined. Reductions for sales of non stock-in-trade items continuously owned by the sellers for a year or more are certainly government subsidies of such sales. The government is favoring a particular business model.
The liquidity of our nation’s financial markets is of lesser economic benefit to our nation. Sales of goods and services rather than transfers of wealth contribute to our nation’s GDP. (GDPs in turn support nations’ median wages).
The vast instances and amounts of sales transactions classified as qualifying for Long term capital gains, (LTCG) tax reduction are transfers of wealth rather than goods or service products.
Only a portion within the minority of sales transactions qualified as LTCG, are capital goods. If as you contend the purpose of LTCG tax reduction is to promote USA’s capital investment, it fails to effectively accomplish its purpose.
LTCG tax reduction is a tax inequity that decreases tax revenues and increases the federal deficit.
I advocate replacing LTCG regulations with rewritten and renacting “income averaging" tax provisions. It would actually accomplish everything that the LTCG provisions promises, it would do so in a more populist and superior manner.
Respectfully, Supposn
Dixie - In Memoriam
New member
Why do you keep calling it "long term" capital gains? People file tax returns each year, if they have capital gains, they are claimed in that year, there is no term other than that. Except in the case of capital gains in large amounts, like over $10k, where the tax man literally shows up at your doorstep for your quarterly payment on the amount. Income averaging is used when someone has a windfall in one year, which they don't expect to have every year.
No it doesn't. Reducing the cap gains tax allows for more investment and job creation.... now if capital gains did not do that, I could perhaps see your point, but it does. So you have something here, which has a direct effect on the number of new jobs created, the amount of new business and enterprise, and subsequently, the amount of income and sales taxes which would be collected as a result. It can be argued that having a capital gains tax, unjustifiably shifts greater portions of tax burdens upon all others, by killing the potential for even greater tax revenue.
I think we should favor business models which, by design, create more jobs and wealth. In fact, it's kind of retarded for us to be bitching about no economic growth or investment, while contemplating how much to raise capital gains tax. What is ironic is, you have allowed your own greed and envy to justify this nonsense, which is killing jobs and the economy, but you claim to be combating greed. It's the equivalent of shooting holes in the boat to let some of the water out.
No argument on where we get our GDP, but how can we have sales of goods and services if the money isn't there to put the business or industry in play? You can't have sales from companies which never exist. This is where you seem to be missing the boat. Sure, a lump sum securities withdrawal of $100 million doesn't really do anything for our GDP, but that money is used to build a factory, which in turn, hires 200 people, who will earn incomes, which will be taxed. The paychecks will be cashed, the people will spend their money in stores, where they will pay sales taxes. Those 200 people who now have a job, are no longer a drain on our resources, but are now contributing to paying taxes and purchasing goods and services, improving our GDP.
It doesn't matter what you believe are "vast instances" or that you keep referring to capital gains as "long term" capital gains, or "(LTCG)" ...as if adding the words "long term" somehow changes your point. 'Transfers of wealth' is another cute little catch phrase you seem to think invokes some negative image of greedy fat cat shifty bastards moving their money around in the dead of night, and we are all supposed to find sympathy for your viewpoint, by working ourselves into a rage over what rich people are doing. The bottom line is, capital gains taxes effect the amount of money wealthy people take out of security investments, for the sake of entrepreneurship, new business, jobs, expansions, etc.
Now you are simply repeating yourself, and your points have not been made. Cap gains encompass virtually ALL capitalist investment. If there isn't any, or it's inadequate, it's because the capital gains tax rate is too high. Reduction in tax rates for capital gains, actually would result in an INCREASE of tax revenues in the long run, by creating more tax paying jobs and taxable sales, and you have offered nothing to contradict this. You keep evaluating based on nothing more than class envy and static tax rates and revenues, without regard for growth. Do you understand and comprehend what economic growth is, and what it does, and why it's important? If we eliminated the capital gains tax, and it had no effect on anything else, then it would be a reduction in tax revenue overall, that's common sense... but that would not be the case. Such a measure would open up capital investment like we've not seen in decades, and the result would be rampant job creation, and economic prosperity... which in turn, produces MORE tax revenue than whatever amount you gave up in cap gains taxes.
You've said this several times now, I get it. The thing is, we still have income averaging, if I'm not mistaken... but that has nothing to do with capital used for investment into a new business or corporation. Income averaging has nothing to do with capital gain, unless the gain is a one-time deal, which most investments aren't. Again, we need to be finding ways to ENCOURAGE economic growth and that starts with ENCOURAGING wealthy people to take their money out of the safe and secure trusts and bonds, and put the money to work creating new jobs and sparking economic growth. This is done by reducing or eliminating the capital gains taxes.
Long Term Capital Gains vs Income Averagiing
Dixie, it’s been many years since I’ve prepared any income tax returns but (if my memory hasn’t completely failed me), it was only long term capital gains that was taxed at the reduced rate. Short term capital gains were owned by the seller for less than a year and taxed at the seller’s regular tax bracket’s rate.
You’re correct about the old “tax averaging” tax regulation provision only benefitting taxpayer’s that enjoyed a “windfall”. It was not to benefit taxpayers that had comparatively constant income levels that didn’t increase much more than the rate of our dollar’s inflation. You ignored this thread’s first message?
Respectfully, Supposn
Excerpted from message #1:
This tax reduction rewarded but was not limited to wealthy investors or those that sold their homes. It benefitted lottery or quiz program winners, sport or entertainment figures, inventors or anyone else that hit ANY KIND of financial jackpot within the taxable year for which they were filing an income tax return. It compensated those who were lucky or daring or devoted years for study or practice of their chosen professions.
It was of no particular benefit to those with comparatively level annual incomes; (such as a Buffett or Romney or your mailman).
I advocate elimination of the long term capital gains loophole and restoring the income averaging
Respectfully, Supposn
Dixie, it’s been many years since I’ve prepared any income tax returns but (if my memory hasn’t completely failed me), it was only long term capital gains that was taxed at the reduced rate. Short term capital gains were owned by the seller for less than a year and taxed at the seller’s regular tax bracket’s rate.
You’re correct about the old “tax averaging” tax regulation provision only benefitting taxpayer’s that enjoyed a “windfall”. It was not to benefit taxpayers that had comparatively constant income levels that didn’t increase much more than the rate of our dollar’s inflation. You ignored this thread’s first message?
Respectfully, Supposn
Excerpted from message #1:
This tax reduction rewarded but was not limited to wealthy investors or those that sold their homes. It benefitted lottery or quiz program winners, sport or entertainment figures, inventors or anyone else that hit ANY KIND of financial jackpot within the taxable year for which they were filing an income tax return. It compensated those who were lucky or daring or devoted years for study or practice of their chosen professions.
It was of no particular benefit to those with comparatively level annual incomes; (such as a Buffett or Romney or your mailman).
I advocate elimination of the long term capital gains loophole and restoring the income averaging
Respectfully, Supposn
Dixie - In Memoriam
New member
Capital gains are capital gains, as far as taxes are concerned. You file an income tax return for a given year, and if you had capital gains in that year, you get a form 10-99, in which you will pay either a 15% capital gains tax or higher income tax on any distributions. There is no exception made for long or short term, those distinctions apply to the type of investment only, they have nothing to do with tax liability.
Unless they've changed the tax code in the past several years, you can still use the income averaging method. If not, that is a provision we need to bring back, because it allows people to mitigate the blow of taxation on huge windfalls. As far as corporate investors go, income averaging has little to do with it, and offers no advantage. The problem is not a sudden windfall, it is the distribution of capital, which an ROI is not expected for some time, if ever... as there are risks to investments.
There is no "capital gains loophole" ...we charge a 15% tax on capital gains distributions, and we should consider reducing or eliminating it. The "capital" has already been taxed, the "gains" are not really gains, but distributions of capital... transfers of wealth... for the sole purpose of capitalistic economic expansion and growth, which means jobs and GDP, and tax revenue.
Unless they've changed the tax code in the past several years, you can still use the income averaging method. If not, that is a provision we need to bring back, because it allows people to mitigate the blow of taxation on huge windfalls. As far as corporate investors go, income averaging has little to do with it, and offers no advantage. The problem is not a sudden windfall, it is the distribution of capital, which an ROI is not expected for some time, if ever... as there are risks to investments.
There is no "capital gains loophole" ...we charge a 15% tax on capital gains distributions, and we should consider reducing or eliminating it. The "capital" has already been taxed, the "gains" are not really gains, but distributions of capital... transfers of wealth... for the sole purpose of capitalistic economic expansion and growth, which means jobs and GDP, and tax revenue.
Income averaging
Dixie, I‘ve encountered mention that “income averaging” is still an option for farmers and ranchers but it was repealed for all of the rest of us.
[Progressive income taxes are an inequity that’s the root cause of many other inequities later introduced into our tax regulations. We wish that weaning our selves off of progressive rates could be simply done. It ain’t that easy.]
I point out that both income averaging and long term capital gains, (LTCG) mitigate that inequity when it occur due to a boon of annual income. I additionally explain other occurrences where income averaging introduces more equitable taxation (but LTCG) does not do so.
I disagree with your contention that with regard to those investing into corporations would gain no advantage from income averaging.
(Refer to message #1)
Respectfully Supposn
Dixie, I‘ve encountered mention that “income averaging” is still an option for farmers and ranchers but it was repealed for all of the rest of us.
[Progressive income taxes are an inequity that’s the root cause of many other inequities later introduced into our tax regulations. We wish that weaning our selves off of progressive rates could be simply done. It ain’t that easy.]
I point out that both income averaging and long term capital gains, (LTCG) mitigate that inequity when it occur due to a boon of annual income. I additionally explain other occurrences where income averaging introduces more equitable taxation (but LTCG) does not do so.
I disagree with your contention that with regard to those investing into corporations would gain no advantage from income averaging.
(Refer to message #1)
Respectfully Supposn
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Dixie - In Memoriam
New member
You keep talking about income averaging, which does not really apply in this debate. It is mostly used by middle class tax payers, who have some kind of windfall in one year, which would put them in the top marginal bracket, if not for the ability to use this method. This may or may not still be part of the tax code, I would have to check, but it simply has nothing to do with industrial financiers, and capitalist investment. The kind of people who have the money to make things happen, are not the typical 'income average' type, in fact, they claim very little income on their tax return, as most of their wealth comes from stock dividends.
The problem is, the wealthy have no enthusiasm about using their wealth to start new business at this time. That's a fact of life we all need to be adult enough to accept here, it's just not happening, they aren't doing what we need investors and financial tycoons to do. In an almost Orwellian manner, we are told everyday about the evil corporations, wall street, the wealthy, the rich... and they are turned into our mortal enemies. It is those people, who have the ability to bring us out of the dismal economic times we are in, and we need to be looking for way to turn that around.
But don't look to Obama or democrats to do that, they are Socialists, they want to destroy Capitalism, so it can be replaced by state-run government. The last thing they want to happen, is for capitalism to make a rebound!
LTCG Income
Dixie, I don’t know when I’ll get time to confirm it but I believe profit derived from the sale of anything owned by the seller for less than a year are short term profits taxed at the taxpayer’s income bracket’s regular rate.
Sales of non-stock-items owned by the seller for a year or more are long term capital gain transactions.
Long term capital gain sales profits are taxed at reduced rates. The actual reduced rates are dependent upon the taxpayer’s income bracket. For the taxable year of 2010 the maximum LTCG rate was 15%.
LTCG is a sales profit. It is not explicitly or otherwise a distribution of a corporations’ capital or any other classification of corporate distribution.
Being a sales profit, LTCG is a profit of income that was never previously taxed.
LTCG does not increase the nation’s GDP. (The GP bolsters the median wage).
LTCG tax reduction reduces USA’s tax revenue and thus increases our federal debt.
Respectfully, Supposn
Dixie, I don’t know when I’ll get time to confirm it but I believe profit derived from the sale of anything owned by the seller for less than a year are short term profits taxed at the taxpayer’s income bracket’s regular rate.
Sales of non-stock-items owned by the seller for a year or more are long term capital gain transactions.
Long term capital gain sales profits are taxed at reduced rates. The actual reduced rates are dependent upon the taxpayer’s income bracket. For the taxable year of 2010 the maximum LTCG rate was 15%.
LTCG is a sales profit. It is not explicitly or otherwise a distribution of a corporations’ capital or any other classification of corporate distribution.
Being a sales profit, LTCG is a profit of income that was never previously taxed.
LTCG does not increase the nation’s GDP. (The GP bolsters the median wage).
LTCG tax reduction reduces USA’s tax revenue and thus increases our federal debt.
Respectfully, Supposn
Just once would be a change.......without some moral, religious, or emotional bullshit as the reasons.....
Income averaging was discontinued many years ago, as far as I know.....I remember being fortunate enough to actually get to use it.....
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Reducing taxes is not the remedy.
Dixie, The private sector has investment money available but they’re reluctant to invest into a sick economy.
Reducing Taxes would to some extent increase investment but there’s a contra-acting financial force to consider. Supply side economics is Voodoo wishful thinking. Serious tax reduction will seriously reduce government’s tax revenue.
Reducing or eliminating the taxes upon long term or all capital gains is a welfare program for the benefit of the wealthy. It would be of net detriment to our nation’s economy.
Of all the economic proposals I’m aware of; the transferable Import Certificate proposal would more certainly and faster increase our GDP and median wage. All net expenses are paid for by U.S. purchasers of foreign goods. Because it’s self-funding, it leaves us free to seek any additional methods to improve our economy.
Refer to the topic “Reduce the trade deficit; increase GDP & median wage”,
posted at 7:54AM, April 20, 2011.
Respectfully, Supposn
Dixie, The private sector has investment money available but they’re reluctant to invest into a sick economy.
Reducing Taxes would to some extent increase investment but there’s a contra-acting financial force to consider. Supply side economics is Voodoo wishful thinking. Serious tax reduction will seriously reduce government’s tax revenue.
Reducing or eliminating the taxes upon long term or all capital gains is a welfare program for the benefit of the wealthy. It would be of net detriment to our nation’s economy.
Of all the economic proposals I’m aware of; the transferable Import Certificate proposal would more certainly and faster increase our GDP and median wage. All net expenses are paid for by U.S. purchasers of foreign goods. Because it’s self-funding, it leaves us free to seek any additional methods to improve our economy.
Refer to the topic “Reduce the trade deficit; increase GDP & median wage”,
posted at 7:54AM, April 20, 2011.
Respectfully, Supposn