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pigsteak wrote:excellent example vertical..but the frothy mouths will say you should pay your fair share which means being taxed on the taxed money.

I'm really confused, since I don't actually have any money. I thought the capital gains tax was applied to the money earned by an investment (i.e. the difference between the selling price and the buying price). Or do you actually have to pay tax on the original money invested?

what they are saying is this schwag.....you have a job and get paid. you pay your federal taxes then and take home the other $200. the bizarre point is that now where ever that $200 dollars goes into the economy it will almost always accrue another sort of tax....put it to work as an investment, then tax is paid on the additional capital earned. put gas in your car, get it taxed again. groceries, tax again. the lower capital gains tax is presumably because this money is "at risk" whereby you can lose it all, and our system wants to reward those who supposedly put money back into the economic cog machine. doesn't it seem burdensome to anyone else that you may pay tax on your earned money multiple times while it is in your pocket? I would vote for a zero rate on capital gains for all except the very wealthy.

wrong in a couple of ways

pigsteak wrote:the lower capital gains tax is presumably because this money is "at risk" whereby you can lose it all, and our system wants to reward those who supposedly put money back into the economic cog machine.

I would guess it is also an incentive to lessen the "day-trading" in an attempt to keep the system a little more stable.

Correct. SHort-term capital gains are taxed MUCH higher to discourage speculative investing. But its only 1-year to be considered long-term, so its not a big time commitment to get the reduced tax rate.

I hate politics and politicians. The only difference between a democrat and a republican is who they blame when they're stealing your money. Now that just sounds like some catchy saying but it is actually well thought out.

Savage wrote:Correct. SHort-term capital gains are taxed MUCH higher to discourage speculative investing. But its only 1-year to be considered long-term, so its not a big time commitment to get the reduced tax rate.

to be clear, short term cap gains are merely tax at your ordinary rate (ie what you pay on your wages) so i guess we can call that "extra high rate";)

pigsteak wrote:

Savage wrote:Correct. SHort-term capital gains are taxed MUCH higher to discourage speculative investing. But its only 1-year to be considered long-term, so its not a big time commitment to get the reduced tax rate.

to be clear, short term cap gains are merely tax at your ordinary rate (ie what you pay on your wages) so i guess we can call that "extra high rate";)

Pig, is it tax on the gains only? I get incentive stock options as part of my pay. They are taxed going in and then only gains are taxed coming out? Or will I get a surprise at tax time this year? This is the first time I've sold some of the options.

brad, options are a tad different as you know...you get granted the 'option" of buying at a certain price, but the gains are what are taxed when you exercise.

on another note, I see where president Clinton called Romney's business career at Bain Capital "stellar"....lol....who's kidding who now.....all millionaires fighting for the power people.