5 ms·

The locations really weren't generally known internally. A few days before the announcement, there was a company-wide all-hands meeting with Jeff where we presu

by mabbo 8y ago

The locations really weren't generally known internally. A few days before the announcement, there was a company-wide all-hands meeting with Jeff where we presumed we'd find out. Nada. Nothin'. No details. We were all left in the dark as much as anyone else. So the real question here is "which employees, and what did they know?". Or even better, will they be living in these condos for a few years, or selling them in 3 months?

saiya-jin 8y ago
Isn't in US some heavy taxation on capital gains from quick property sales to prevent this type of speculation? Ie in France it's progressively lowering after 5-6 years, it gets down to reasonable levels in I think 22 years. The result is much less volatility on the market.
- ojbyrne 8y ago
  Short term capital gains are taxed at the same rate as ordinary income. Long term capital gains (greater than 1 year) get taxed at a lower rate.
  - djrogers 8y ago
    For homes, you need to have lived in the house as your primary residence for 2 of the past 5 years in order to qualify for long-term capital gains.
    - TomVDB 8y ago
      This is not true at all. You need to live there for 2 of the past 5 years to claim your $500k capital gains exclusion. Otherwise the normal short-term/long-term capital gains rules apply. https://www.thebalance.com/sale-of-your-home-3193496 https://www.thebalance.com/sale-of-your-home-3193496
- deleted 8y ago
  [deleted]
- danielvf 8y ago
  There is a long-term capital gains tax break for holding a certain number of years. However with real estate you can sell one property and use the money to buy another within a certain amount of time and not have a taxable event. (See https://www.irs.gov/businesses/small-businesses-self-employed/like-kind-exchanges-real-estate-tax-tips https://www.irs.gov/businesses/small-businesses-self-employe... )
  - irq11 8y ago
    So it’s worse than having a policy that is neutral on flipping: our tax system actually encourages it. We shoud tax short term capital gains on property at 100 percent. Nobody should be able to profit by driving up the cost of housing.
    - wutbrodo 8y ago
      I'm surprised to see you downvoted so heavily; I thought HN was generally familiar with Georgism (which I'm pretty much a full-throated supporter of), and what you're suggesting is a softer version of Georgism (limited to short term gains). The principle behind capitalism is that you create value and get a portion of the value thereby created as income/return. Land value appreciation very much doesn't fall into this category, unlike every other investment in which 1) the capital serves an allocative purpose and 2) is being put into productive use by someone else. Land value gains are generally extractive (and destructive, through the inefficiency it introduces) of the wealth created by nearby economic activity. I know someone who bought a bought a house in Beverly Hills in the 70s for $30k: forty years and a ~million dollars of value growth later, they sold it and collected four decades of extraction from the economic activity of the area around them. There's no universe in which this is sensible policy, and as you rightly point out, encouraging it through tax policy is even more insane. I think it's something about homeownership that makes people hyper-defensive about this topic and unable to think clearly. I can't say I relate, given that my dad's career (and an outsize portion of his portfolio) in real estate doesn't prevent me from seeing the issue clearly.
      - mbrumlow 8y ago
- deleted 8y ago
  [deleted]
- romed 8y ago
  In the US you may exclude up to half a million dollars of gains from your taxable income if you owned and lived in a property for at least two years. Otherwise gains on the sale of real property are taxed as ordinary income.
  - ryanwaggoner 8y ago
    If you hold it for longer than a year, long-term capital gains rates apply, which are generally lower than ordinary income rates.
  - drewmol 8y ago
    Specifically, 250K for single filers, 500K for married couples. Also, if you're married by Dec 31st, the IRS counts that the same as being married all year in terms of filing status eligibility, so it may pay off to get hitched before you sell and divorce after ;-)
  - walshemj 8y ago
    That's harsh in the UK your primary residence is exempt totally.
    - gowld 8y ago
      It's not harsh, it's acknowledging that windfall income is unearned. That half a million exemption (or half that for unmarried people) is in addition to deductions for all depreciation and expenses.
- deleted 8y ago
  [deleted]
liftbigweights 8y ago
> Or even better, will they be living in these condos for a few years, or selling them in 3 months? They could rent it out. If LIC is expecting an influx of highly paid workers, rents are bound to increase significantly over the next few years and if things work out, the condo prices will increase even more. Why not hold onto it for a few years collecting rent and then cash out with a nice long term capital gains tax treatment on possibly significant capital gains?
- Nav_Panel 8y ago
  It's a tossup though. LIC's (relatively recent) zoning means the HQ2 announcement might lead to a wave of new construction in the area, which could cause rents to drop.
conanbatt 8y ago
Does it matter.
- nsgi 8y ago
  Yes. If they sell them in three months they're using insider information for financial gain. If they live there they could have just been making an early start on finding somewhere convenient to live. Whatever the rules are there's definitely a moral difference.
  - mbrumlow 8y ago
    I am no lawyer. But I think insider information is only with respects to stocks. Also. I find no moral issue with this at all. Nor do I think it is somehow unfair. Even so Jeff him self could and I think did pick a place located near some of his houses. We really need to stop getting outraged when somebody else gets ahead. This is just pure jealousy and is very toxic. Pissing I somebody else's limonaid is not going to make yours taste any sweeter.
    - otterley 8y ago
      > But I think insider information is only with respects to stocks. Technically it's "securities," which is a broader array of financial instruments than stocks. But I'm not sure that real estate, particularly real estate that one might use as a primary residence, is considered a qualifying security with respect to SEC insider trading laws.
      - kenneth 8y ago
        Real estate is not a security, unless you buy a derivative of it (like equity in a REIT)
      - fierro 8y ago
        lol real estate itself is not a security
  - conanbatt 8y ago
deleted 8y ago
[deleted]

by mabbo 8y ago

saiya-jin 8y ago

Isn't in US some heavy taxation on capital gains from quick property sales to prevent this type of speculation? Ie in France it's progressively lowering after 5-6 years, it gets down to reasonable levels in I think 22 years. The result is much less volatility on the market.

ojbyrne 8y ago
Short term capital gains are taxed at the same rate as ordinary income. Long term capital gains (greater than 1 year) get taxed at a lower rate.
- djrogers 8y ago
  For homes, you need to have lived in the house as your primary residence for 2 of the past 5 years in order to qualify for long-term capital gains.
  - TomVDB 8y ago
    This is not true at all. You need to live there for 2 of the past 5 years to claim your $500k capital gains exclusion. Otherwise the normal short-term/long-term capital gains rules apply. https://www.thebalance.com/sale-of-your-home-3193496 https://www.thebalance.com/sale-of-your-home-3193496
deleted 8y ago
[deleted]
danielvf 8y ago
There is a long-term capital gains tax break for holding a certain number of years. However with real estate you can sell one property and use the money to buy another within a certain amount of time and not have a taxable event. (See https://www.irs.gov/businesses/small-businesses-self-employed/like-kind-exchanges-real-estate-tax-tips https://www.irs.gov/businesses/small-businesses-self-employe... )
- irq11 8y ago
  So it’s worse than having a policy that is neutral on flipping: our tax system actually encourages it. We shoud tax short term capital gains on property at 100 percent. Nobody should be able to profit by driving up the cost of housing.
  - wutbrodo 8y ago
    I'm surprised to see you downvoted so heavily; I thought HN was generally familiar with Georgism (which I'm pretty much a full-throated supporter of), and what you're suggesting is a softer version of Georgism (limited to short term gains). The principle behind capitalism is that you create value and get a portion of the value thereby created as income/return. Land value appreciation very much doesn't fall into this category, unlike every other investment in which 1) the capital serves an allocative purpose and 2) is being put into productive use by someone else. Land value gains are generally extractive (and destructive, through the inefficiency it introduces) of the wealth created by nearby economic activity. I know someone who bought a bought a house in Beverly Hills in the 70s for $30k: forty years and a ~million dollars of value growth later, they sold it and collected four decades of extraction from the economic activity of the area around them. There's no universe in which this is sensible policy, and as you rightly point out, encouraging it through tax policy is even more insane. I think it's something about homeownership that makes people hyper-defensive about this topic and unable to think clearly. I can't say I relate, given that my dad's career (and an outsize portion of his portfolio) in real estate doesn't prevent me from seeing the issue clearly.
    - mbrumlow 8y ago
deleted 8y ago
[deleted]
romed 8y ago
In the US you may exclude up to half a million dollars of gains from your taxable income if you owned and lived in a property for at least two years. Otherwise gains on the sale of real property are taxed as ordinary income.
- ryanwaggoner 8y ago
  If you hold it for longer than a year, long-term capital gains rates apply, which are generally lower than ordinary income rates.
- drewmol 8y ago
  Specifically, 250K for single filers, 500K for married couples. Also, if you're married by Dec 31st, the IRS counts that the same as being married all year in terms of filing status eligibility, so it may pay off to get hitched before you sell and divorce after ;-)
- walshemj 8y ago
  That's harsh in the UK your primary residence is exempt totally.
  - gowld 8y ago
    It's not harsh, it's acknowledging that windfall income is unearned. That half a million exemption (or half that for unmarried people) is in addition to deductions for all depreciation and expenses.
deleted 8y ago
[deleted]

liftbigweights 8y ago

> Or even better, will they be living in these condos for a few years, or selling them in 3 months? They could rent it out. If LIC is expecting an influx of highly paid workers, rents are bound to increase significantly over the next few years and if things work out, the condo prices will increase even more. Why not hold onto it for a few years collecting rent and then cash out with a nice long term capital gains tax treatment on possibly significant capital gains?

Nav_Panel 8y ago
It's a tossup though. LIC's (relatively recent) zoning means the HQ2 announcement might lead to a wave of new construction in the area, which could cause rents to drop.

conanbatt 8y ago

Does it matter.

nsgi 8y ago
Yes. If they sell them in three months they're using insider information for financial gain. If they live there they could have just been making an early start on finding somewhere convenient to live. Whatever the rules are there's definitely a moral difference.
- mbrumlow 8y ago
  I am no lawyer. But I think insider information is only with respects to stocks. Also. I find no moral issue with this at all. Nor do I think it is somehow unfair. Even so Jeff him self could and I think did pick a place located near some of his houses. We really need to stop getting outraged when somebody else gets ahead. This is just pure jealousy and is very toxic. Pissing I somebody else's limonaid is not going to make yours taste any sweeter.
  - otterley 8y ago
    > But I think insider information is only with respects to stocks. Technically it's "securities," which is a broader array of financial instruments than stocks. But I'm not sure that real estate, particularly real estate that one might use as a primary residence, is considered a qualifying security with respect to SEC insider trading laws.
    - kenneth 8y ago
      Real estate is not a security, unless you buy a derivative of it (like equity in a REIT)
    - fierro 8y ago
      lol real estate itself is not a security
- conanbatt 8y ago

deleted 8y ago

[deleted]