Problems With Tax on Unrealized Capital Gains

Some politicians are proposing a tax on unrealized capital gains. I'm covering how that would work and what problems that would cause for you.

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Mike Bernard, CFP® offers advisory services through KFG Wealth Management, LLC dba Korhorn Financial Group. This information is for general financial education and is not intended to provide specific investment advice or recommendations. All investing and investment strategies involve risk, including the potential loss of principal. Asset allocation & diversification do not ensure a profit or prevent a loss in a declining market. Past performance is not a guarantee of future results.
Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, and CFP® (with plaque design) in the United States to Certified Financial Planner Board of Standards, Inc., which authorizes individuals who successfully complete the organization’s initial and ongoing certification requirements to use the certification marks.

[gingerkilkus]

These frequent tax code changes are disrupting my long-term investment strategies. Are there ways to structure my investments to be more resilient to potential tax code modifications?

[laurenhomel]

This is very scary and exactly what they want. You will own nothing...

[mikesgarage]

So then we could deduct unrealized losses?

[markmyjak]

This is all BS. There 9850 people who are worth $100M+. The government thinks they can balance the budget on the backs of 9850 wealthy people. It will fall to less and less. You will have to sell assets to pay. Unintended consequences will fall on to employees. Meaning your job is gone. Your job is gone because your employer had to close the business to sell everything to pay the wealth tax. The other problem is that everyone is trying to sell and there are no buyers.

[SteveGrin]

All tax is theft. Taxing you on an investment that you purchased with money you paid tax on is double theft. Finally, the government would be killing the goose that lays the golden eggs. Sure, they would get a bump in revenue at the start, but it would eventually go to zero, especially when everyone that's making the big gains would be leaving.

[Sky]

should be allowed to subtract inflation from the capital gains

[mikesgarage]

A vote for CommieLA is like eating a gun.

[daveschmarder-]

The 16th amendment made collecting income taxes legal. I'm not a member of Congress. I'm only an honest person, but I would expect that taxing wealth would require an amendment to the constitution too.
I would expect a number of people would give up their citizenship and move to a low tax place such as the E U.
This was mentioned two years ago and it stopped. It is just a talking point of one of the political parties.

[sz]

Vote for Trump is the only way to stop it!

[LizTrollingerCLS-estM-F]

This is a proposed tax on people with 100 Million+ in assets - I don't think this was mentioned in the video.

[rudeboy]

Taxing people on money they haven’t made yet. Sounds about right…

[dr.michaellittle]

Until there is actual legislative language on this, you’re just in hot pursuit of the uncertain.

[jameshoscila]

So how would you ever have a LONG-term gain this way?

[datbio]

100% this does not make a single sense to the public other than government collecting more in tax. They can just simply print more money.

[johnneal]

Common sense, no one will invest, saving money with a interest bearing account would cost half of your gain .so just rip the sheets off an look !

[IngridWiemer]

"Unrealized capital gains tax" is intended for people with a net worth of 100 million or more (and 80% liquidity)...don't mislead people with an example of a $5, 000 gain.

[redjetsen]

If this ever became legislation that might pass,
capital outflows would increase before it is enacted.

[razorsedge]

Does the phrase ring a bell-"You'll own nothing and be happy.'

[bernardopedro]

not american and I don't support Kamala as well, but isn't this policy for people with a networh of 100M+?

[phillyedhrj]

Unrealized gain is really an increase in FMV not income until you sell it.