Unless you know something I don't, this is when they sell a position. If you tax the delta in wealth on the way up (absent an exit that creates a taxable gain),

Unless you know something I don't, this is when they sell a position. If you tax the delta in wealth on the way up (absent an exit that creates a taxable gain), what do you do if wealth decreases? I.e. If I hold 100 shares of AMZN at $1,000 and it doubles to $2000 without me selling, and I owe taxes on the increase in net wealth from $100k to $200k.. what happens if AMZN drops by 25% the next year. Also, what does this do to the predictability of tax receipts for federal budgeting?