Tax Bill

Discussion in 'The War Room' started by sub_thug, Dec 6, 2017.

  1. sub_thug Red Belt

    sub_thug
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    Well, it’s coming out that the Senate tax bill is treating all stock holdings as “First In First Out.” That means that you have to sell the first shares you get from a company first. For those that aren’t following, let’s say you work for Amazon, receiving 3 shares per year as part of your stock options. When you were given those shares when you started working there in 2000, they weren’t that valuable. Less than $100/share. Now, they are worth over $1100/share. When you sell them, you have to sell your oldest ones first, meaning that those are the ones worth the most. That also means that you’re paying more in capital gains tax that way. That’s a real bummer, harming the retirement savings of those that have been saving.

    This tax bill is a bad bill. Not in a left v right way, but just in an objectively bad policy kind of way. It takes effect next year, so maybe now is the time to dump all my stock and jump all in on bitcoin before someone else finds new ways to tax me...
     
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  2. hillelslovak87 Red Belt

    hillelslovak87
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    Now this is pod racing!!!
    What domestic programs you think will be decimated to pay for this giveaway to the rich that does nothing to address the offshoring of funds and labor?
     
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  3. panamaican Senior Moderator

    panamaican
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    I just read that there's some language in the bill that screws over companies with the corporate AMT, resulting in them essentially paying hundreds of billions more in taxes than expected and offsetting the benefits that come from a cut in rates.

    If both of these things are accurate, the GOP is doubling down on their f' ups. They rushed the bill and didn't give anyone else time to proofread it....but it doesn't look like they did a good job of reading it or writing it.
     
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  4. Voltron Blue Belt

    Voltron
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    We are all fucked unless you are a millionaire
     
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  5. cincymma79 Black Belt

    cincymma79
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    Point to that page
     
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  6. PainIsLIfe Gold Belt

    PainIsLIfe
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    ok, so you're also claiming it as a long term gain instead of short term so you'll pay less taxes on it.
     
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  7. PainIsLIfe Gold Belt

    PainIsLIfe
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    Has it even been put online?
     
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  8. Voltron Blue Belt

    Voltron
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    Come on man you think this tax bill was made to help the common folk?
    <DisgustingHHH>
     
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  9. sub_thug Red Belt

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    What it's going to do is cause me to move my money around a lot less. That's the issue. A lot more investors are going to hold positions on certain companies in order to avoid paying higher capital gains tax. So equity is going to stay put, and when money doesn't move around, young/rising companies won't get as much investment capital for them to put back into their companies/products. That's the whole point of being a publicly traded company. When you increase taxes like that, you are essentially stagnating the market via government constraints.
     
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  10. sub_thug Red Belt

    sub_thug
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    The thing is, as I alluded to in post #10, this doesn't even help the exceptionally rich if most of their total value is held in the stock market. This is the sort of stuff that causes the market to slow down. The people who are really crapping their pants right now are the major trading companies like AmeriTrade, E*Trade, T Rowe Price, Vanguard, etc. Right now, the market is the best that it's ever been, and people are making money hand over foot. Why shoot all that in the foot like this? Like I said in the OP, this isn't even a left/right thing. This is just a really bad policy.
     
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  11. 44nutman Black Belt

    44nutman
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    Don't sell, all the money the rich save, will trickle down to us serfs. So the money the 1% saves means they have more money the give to the poor.
    Kansas has the same policy and their economy is booming.
     
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  12. PainIsLIfe Gold Belt

    PainIsLIfe
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    What you can't reinvest you're long term capital gains? Since it's taxed less you should have more to invest in those new companies.
     
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  13. sub_thug Red Belt

    sub_thug
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    I can reinvest, but I'm paying more taxes because I'm having to sell my highest value stocks first. So I less to reinvest. That's the issue here. I think the best way to promote growth is to reduce the capital gains tax, incentivizing people to move their money around more frequently. But that's not what this bill does.
     
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  14. sub_thug Red Belt

    sub_thug
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    See posts 10 and 11
     
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  15. PainIsLIfe Gold Belt

    PainIsLIfe
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    No. You're paying tax on your longest held stock with is going to be at a lower tax rate than your marginal tax rate.
     
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  16. sub_thug Red Belt

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    Lower rate, yes. Higher monetary value because the oldest stocks yield the highest profits if you follow the mantra "Buy low, sell high."
     
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  17. PainIsLIfe Gold Belt

    PainIsLIfe
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    You're paying either nothing 15 or 20% on LT capital gains.

    You're paying your marginal tax rate on ST capital gains.

    It sounds like you just don't want to pay on your taxes that you've made the most money on, but you're going to pay that eventually unless you're in the low bracket.
     
    #17
  18. Bloodworth Silver Belt

    Bloodworth
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    Give the man his 4 years and ideas to make America better.

    That's the magic of the u.s.

    If it's a failure or you don't like results you can vote again.

    Let's check back in 3 years
     
    #18
  19. Cid Silver Belt

    Cid
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    Wouldn't they be worth the same as all the others?

    I'm nitpicking I'll admit.

    Appreciated value.
     
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  20. sub_thug Red Belt

    sub_thug
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    So I buy shares at $10/share and then I buy the amount of shares later at $70/share. I decide to sell half my shares at $100/share. In FIFO, I have to sell the oldest ones first, so I am paying capital gains tax on the profit of $90/share. But if I wanted to sell the newer ones first because I wanted that money to buy a home or reinvest it into another company, I’d only be paying capital gains tax on the profit of $30/share. So much less tax. As such, I am incentivized to leave my money where it is for as long as possible so that I pay less tax.
     
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