Capital gains & income averaging.

Supposn

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Jul 26, 2009
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Capital gains & income averaging.

Long term capital gains are not economically more or less beneficial than incomes derived from entrepreneurs’ steadily nurturing and reinvesting into their enterprises.

I am not opposed to speculators but I’m opposed to using tax policy to favor any business model over others. Unlike the proponents of the long term capital gains tax loopholes, I prefer our government promote transparent open markets that we all may be able to trust.

Refer to the topic “Capital gains income’s tax discount is unjustified”, posted at 11:02, April 16, 2012.

There was an “income averaging” provision within our income tax regulations that mitigated progressive tax rate’s excesses when applied to the filing’s year’s taxable income.
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
 
I advocate elimination of the long term capital gains loophole and restoring the income averaging,

Respectfully, Supposn

why not eliminate all taxes on business activity so businessmen will make all decisions capitalisticially, i.e., based on improving our standard of living rather than on what some idiot soviet liberal bureaucrat guesses will serve some special interest.
 
I advocate elimination of the long term capital gains loophole and restoring the income averaging,

Respectfully, Supposn

why not eliminate all taxes on business activity so businessmen will make all decisions capitalisticially, i.e., based on improving our standard of living rather than on what some idiot soviet liberal bureaucrat guesses will serve some special interest.

Edward Baiamonte, if a nation taxes any net incomes, it should tax all net incomes.

I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of individuals’ income taxes.
Historically it’s been our experience that otherwise entrepreneurs declare little or no personal incomes but they’ll live very well upon their enterprise’s expense accounts.

Respectfully, Supposn
 
Good plan! Chase all our high earners out of the country! Great! Do that! See how your taxes skyrocket to pick up the slack.
 
Good plan! Chase all our high earners out of the country! Great! Do that! See how your taxes skyrocket to pick up the slack.

California Girl, there’s a logical fault within your message.
If U.S. investors are earning consistently high incomes in the USA, why would they wish to leave our nation?

Respectfully, Supposn
 
I advocate elimination of the long term capital gains loophole and restoring the income averaging,

Respectfully, Supposn

why not eliminate all taxes on business activity so businessmen will make all decisions capitalisticially, i.e., based on improving our standard of living rather than on what some idiot soviet liberal bureaucrat guesses will serve some special interest.[/QUOTE]


Edward Baiamonte, if a nation taxes any net incomes, it should tax all net incomes.

I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of individuals’ income taxes.
Historically it’s been our experience that otherwise entrepreneurs declare little or no personal incomes but they’ll live very well upon their enterprise’s expense accounts.

Respectfully, Supposn

why not eliminate all taxes on business activity so businessmen will make all decisions capitalisticially, i.e., based on improving our standard of living rather than on what some idiot soviet liberal bureaucrat guesses will serve some special interest.[/
 
Edward Baiamonte, if a nation taxes any net incomes, it should tax all net incomes.

I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of

sssindividuals’ income taxes.
Historically it’s been our experience that otherwise entrepreneurs declare little or no personal incomes but they’ll live very well upon their enterprise’s expense accounts.

Respectfully, Supposn


why not eliminate all taxes on business activity so businessmen will make all decisions capitalisticially, i.e., based on improving our standard of living rather than on what some idiot soviet liberal bureaucrat guesses wievenue ll serve some special interest.[/


Beecause the nation requires tax revemd







2to trh
 
Beecause the nation requires tax revemd
2to trh

if I disagreed I'll pay you $10,000.

What you want is to eliminate all business tax, since tax cost is passed on like any other cost, so that business can make economic decisions and end the recession rather than tax avoidence decisions.
 
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Clinton raised the long term cap gains tax rate to 28%, and nobody really cared. The economy took off anyway, and we had high GDP growth and good job creation. The Gingrich lead repub Congress lowered it down to 20% in 1997 and the economy continued to boom. And of course Bush lowered it to 15% in 2003 after a recession and the 9/11 attack and the economy picked up significantly. Many economists would credit the CG rate cut as at least a factor. Point is, sometimes it matters more than at other times.

That rate is going up to 20% in 2013 anyway, under current law. But the real question is whether or not raising that rate to match the ordinary marginal tax rate would have a deletorious effect at a time like this. I look at the expected increase in revenue relative to the possible hit to the economy and have to believe it's just not worth it for now. Banks require collateral before they make business loans for startups, which is where most new jobs come from. Angel investors are needed, you don't want to disincentivize them at a time when the economy is struggling.
 
Angel investors are needed, you don't want to disincentivize them at a time when the economy is struggling.

yes you disincent when you tax capital gains leaving less capital for new ventures like Apple Google HP Intel etc etc.

In the industry they say they need as many shots on goal as possible.

The liberal, in his blind hatred, envy, and ignorance is forced to disregard this obvious fact.
 
I advocate elimination of the long term capital gains loophole and restoring the income averaging,

Respectfully, Supposn

why not eliminate all taxes on business activity so businessmen will make all decisions capitalisticially, i.e., based on improving our standard of living rather than on what some idiot soviet liberal bureaucrat guesses will serve some special interest.

Edward Baiamonte, if a nation taxes any net incomes, it should tax all net incomes.

I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of individuals’ income taxes.
Historically it’s been our experience that otherwise entrepreneurs declare little or no personal incomes but they’ll live very well upon their enterprise’s expense accounts.

Respectfully, Supposn

I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of individuals’ income taxes.

Will you be eliminating taxes on dividends?
 
I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of individuals’ income taxes.

Will you be eliminating taxes on dividends?

its idiotic and liberal to tax business since they merely pass on the cost to us like they do for all costs. This is a concept over the liberal IQ.
 
Edward Baiamonte, if a nation taxes any net incomes, it should tax all net incomes.

I’m a proponent of keeping the top rate of corporate income taxes equal to the top rate of individuals’ income taxes.
Historically it’s been our experience that otherwise entrepreneurs declare little or no personal incomes but they’ll live very well upon their enterprise’s expense accounts.

Respectfully, Supposn

Will you be eliminating taxes on dividends?

Toddsterpatriot, you ask a good question; that goes a long way to getting a handle on any topic. Let us digress and discuss the accounting of dividends.

I have never been able to accept the logic when an accountant explained that corporations pay dividends with post tax dollars; (i.e. that corporate income was not figuratively but actually paid once by the corporation and a second time by the dividend recipient).

Rather than correcting our illogical corporate accounting practice, the conservative remedy was to create an additional illogical loop hole within our individual taxation; taxes are waived or extremely reduced for dividend income. On principal I’m opposed to special strokes for special folks.

I’d rather dividends be paid from pre-taxed dollars which reduce corporate taxable incomes and dividends be treated as ordinary income.

If this to a net extent reduces government’s tax revenue while increasing individuals’ taxes, so be it. There must be some benefit to a tax system with logical integrity.

Respectfully, Supposn
 
Capital gains & income averaging.

Long term capital gains are not economically more or less beneficial than incomes derived from entrepreneurs’ steadily nurturing and reinvesting into their enterprises.

I am not opposed to speculators but I’m opposed to using tax policy to favor any business model over others. Unlike the proponents of the long term capital gains tax loopholes, I prefer our government promote transparent open markets that we all may be able to trust.

Refer to the topic “Capital gains income’s tax discount is unjustified”, posted at 11:02, April 16, 2012.

There was an “income averaging” provision within our income tax regulations that mitigated progressive tax rate’s excesses when applied to the filing’s year’s taxable income.
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

I think its reasonable to differentiate between short term capital gains and long term capital gains.

However I am much less convinced that there is any reason to tax labor income at higher rates than capital gains.

One way to tax capital gains (regardless of how long they've been vested) is to tax only on the profit MINUS the CPI inflation that has occured while the investment was in place.
 
...less convinced that there is any reason to tax labor income at higher rates than capital gains...
Depends on what your goal is. If you want money going into the treasury then you tax each as much as you can until revenue drops. You can get away with a higher rate on labor. Obama acknowlegded this back during the primaries (from here):

GIBSON: And in each instance, when the rate dropped, revenues from the tax increased; the government took in more money. And in the 1980s, when the tax was increased to 28 percent, the revenues went down.

So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?

OBAMA: Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness.
Then again, if the goal is simply revenge against cap. gains receivers, then taxing doesn't make as much sense as say, revolution and mass executions.
 
...less convinced that there is any reason to tax labor income at higher rates than capital gains...

Depends on what your goal is.

Spot on.

In fact, the argument for any policy depends on your goal.

And I propose that one's goal, ought to be based on what thye economy needs to find that balance between supply and demand.

IF, FOR EXAMPLE, there was a serious shortage of money for investment, my policy proposal would THEN BE that we tax labor at a higher rate than investment.

But clearly that is not the state of affairs our current economy finds itself in AT THIS TIME.

Economic policies ought to be based on what we think will work to keep our economy going.

NOT on some misinformed belief that there is ONE path to a health economy, but based on the theory that different economic cicrumstances demand different policy decisions.

Make sense?
 
...there was a serious shortage of money for investment, my policy proposal would THEN BE that we tax labor at a higher rate... ...Make sense?
No, partly because raising labor taxes won't encourage investing, and also becuase stock prices doubling in the past three years means there's already a lot of money available for investment.
 
the theory that different economic cicrumstances demand different policy decisions.[/B]

Make sense?

no its actually liberal and so idiotic. It assumes a soviet committee of liberal geniuses can figure out the right policy when they could not even see a huge housing bubble about to explode right under their noses. FDR kept the Depression going for 10 years, the soviets and Red Chinese keep their depressions going for 50 years because they did not know the right policy.

The economy is far too complex. As Adam Smith said, no one knows how to make a pin, let alone manage the entire economy. This will be over a liberals head: capitalism is best because it allows everyone to interact and indirectly contribute the wisdom of the masses to the best possible policies.
 
Capital gains & income averaging.

There was an “income averaging” provision within our income tax regulations that mitigated progressive tax rate’s excesses when applied to the filing’s year’s taxable income.
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

I think its reasonable to differentiate between short term capital gains and long term capital gains.

However I am much less convinced that there is any reason to tax labor income at higher rates than capital gains.

One way to tax capital gains (regardless of how long they've been vested) is to tax only on the profit MINUS the CPI inflation that has occured while the investment was in place.

Editec, long term capital gains, (LTCG) are taxed at extremely lesser rates than other incomes. Entrepreneurs choosing to reinvest and nurture their enterprises do not contribute less and those that cash out do not contribute economically more to our nation.
Granting more favorable tax treatment to a particular business model shifts a greater portion of our tax burdens upon all other industries and taxpayers. I advocate eliminating the extremely reduced rates favoring LTCG.

If the U.S. Congress determines it’s politically necessary or economically advantageous to enact a replacing tax reduction, I’m a proponent of re-enacting the income averaging provisions of our income tax regulations.

LTCG tax provisions always benefit sellers of non-stock-in-trade items continuously owned by the seller for at least a year prior to their date of sale. LTCG tax provisions benefit a very narrow segment of our taxpayers’ population.

Income averaging tax provisions do not benefit a taxpayer with current annual taxable incomes that are not significantly greater than that of the taxpayers’ prior year and the average annual taxable incomes for a given number of prior years.

Income averaging benefits a much broader (than LTCG) segment of our taxpayers’ population. But unlike LTCG, income averaging is fully affected by the numbers of lean years and their comparative amounts of taxable incomes.

Respectfully, Supposn
 
quote]GIBSON: So why raise it at all, especially given the fact that 100 million people in this country own stock and would be affected?

OBAMA: Well, Charlie, what I've said is that I would look at raising the capital gains tax for purposes of fairness.
Then again, if the goal is simply revenge against cap. gains receivers, then taxing doesn't make as much sense as say, revolution and mass executions.[/QUOTE]

ExPat_Panama, I would suppose a large proportion of common share holders, not proportion of shares held), are middle income earners whose shares are managed for them through their tax deferred funds. While their holdings remain in those funds, they derive no tax benefits due to the long term capital gains reduced tax rates.

If we were to restore the income averaging provisions of our tax regulations, we still would gain no benefit from those tax provisions while their holdings remain within tax deferred funds.

Respectfully, Supposn
 

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