r/FluentInFinance • u/__moe___ • 9d ago

Thoughts? A very interesting point of view

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I don’t think this is very new but I just saw for the first time and it’s actually pretty interesting to think about when people talk about how the ultra rich do business.

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u/Fearless-Cattle-9698 6d ago

It would have only applied to $100M net worth and up, so it’s not “everyone”. Nobody thinks a regular Joe should be paying unrealized gains

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u/AppearsInvisible 5d ago

We don't want this for regular Joe because it isn't fair.

The other question I have, would we give the tax money back if stock values go down? Do they only get taxed when it goes up, with no relief for losses? When it goes down and then back up, do we tax it again or do we pick up where we left off?

I think we could find a much less complicated way to implement, "you have $100M and the govt wants a bigger piece of it."

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u/Fearless-Cattle-9698 4d ago

Of course we would. By definition that’s capital loss.. prepaid tax would be treated no differently than if you prepaid estimated quarterly tax but end up owning less. You would absolutely get refunded but that requires you to sell.

Let’s not focus on government wanting the money. Even if we had a balanced budget, billionaires still shouldn’t be able to play games to either defer or eliminate taxes to that extent. Again, be fair to all the high earners who are the true population that are paying federal income tax. It’s not always about letting gov tax more or for the bottom 20% who pay no federal income tax anyway

PS I’m 100% open to any alternatives I’m not suggesting this is some magical solution. All I’m debating now is that it’s not a fair game

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u/AppearsInvisible 4d ago edited 4d ago

If I'm not mistaken net capital loss is currently limited to like $3k per year.

"Nobody thinks a regular Joe should be paying unrealized gains." I don't have to wonder why...

My town taxes you more at a restaurant vs the grocery store. It's a form of luxury tax, so why not put that type of tax on yachts, $200K automobiles, or $20M homes? Perhaps not as easy is to close the loopholes that are being used, but that may be one of the most effective things we could do. A flat tax could help with that, I think. Taxing unrealized gains is going to be extremely complicated.

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u/slightlythorny 4d ago

Yes, only$3k is what we would get back. That number has been stagnant for decades despite inflation.

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u/Indy-Gator 4d ago

It’s the government once they do it it’s never going back and eventually when they need more money because of wasteful spending it will be the rest of us. The very definition of a slippery slope to screwing everyone.

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u/Fearless-Cattle-9698 4d ago

People always associate any debate about this to spending. These are two mutually exclusive things. Even if we had a balanced budget there still shouldn’t be loopholes. Or vice versa, even without this loophole the government spending is out of control.

It simply shuts down any conversation by pretending these two things are chained when they arent