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You might be OK with being taxed in the form of some of your stocks, but would you want to be taxed partial ownership of your real estate based on increase in i

You might be OK with being taxed in the form of some of your stocks, but would you want to be taxed partial ownership of your real estate based on increase in its market value? What about private high-risk equity in a venture you started by risking all of your own money? It could go to zero (or millions) in a decade, but for now the government becomes an increasing shareholder because of its current YoY volatility... Taxing non-income wealth increases by any means incentivizes the government to manipulate the prices of those assets -- and more than any other entity, the government possesses the power to do so through regulation and legislation. It also makes the government the eventual largest capital owner, which could create all sorts of unintended consequences. It could sit on those assets indefinitely (like it does its liabilities) instead of selling and using the money to fund itself. There's a special kind of poverty that exists when the government owns almost everything. Also, there's a big difference between legal worth at a given time and fungible value at that time. The difference (or lack thereof) between the two could itself create all sorts of opportunities for gaming the system when fungible value becomes a basis for being taxed.

teachingassist 5y ago
OK. You seem to be agreeing that this would be a fine system with those caveats. So: Exemptions specifically covering residency already exist in finance law. If you go bankrupt, you can still live in your house (only if you owned it, mind). The government, as soon as practical, can auction the stock it receives. Thus identifying its value and releasing the funds.
- TimTheTinker 5y ago
  > You seem to be agreeing that this would be a fine system with those caveats. I'm not advocating anything in particular. I'm only pointing out some potentially serious issues with the proposed system. Sure, primary residence could be excluded. But that doesn't change anything about what I said, except perhaps blunt the initial impact on the middle class. > The government, as soon as practical, can auction the stock it receives. Thus identifying its value and releasing the funds. Perhaps that could be part of the tax law. I doubt it would stay that way... once the government can own stocks and portions of real estate, I'm sure it will seek to incrementally increase its benefit from doing so. I shudder to imagine politician-beaurocrats as the most powerful hedge fund managers of tomorrow.
  - teachingassist 5y ago
    > once the government can own stocks and portions of real estate, I'm sure it will seek to incrementally increase its benefit from doing so. There's nothing stopping the government from owning these things already (governments own plenty of real estate, in particular), so this seems like undue cynicism.
    - TimTheTinker 5y ago
      There's a big difference between agencies owning buildings within which to do business (or the BLM owning vast swaths of land for environmental preservation) and the IRS maintaining a real estate asset class. In fact there's almost no comparison to be made between the two.
      - teachingassist 5y ago
        Regarding the government's ownership of real estate, I suggest you are simply mistaken, e.g.: https://www.forbes.com/sites/bisnow/2017/04/11/solving-the-mystery-of-government-owned-real-estate/?sh=317b07cf2bd0 https://www.forbes.com/sites/bisnow/2017/04/11/solving-the-m...
        TimTheTinker 5y ago
        That article is talking about local governments, not the federal government.
        teachingassist 5y ago
        Ctrl-F "federal government" suggests otherwise. This is now really a bad faith argument. You've moved the goalposts (again), and declared that your new goal wasn't met (when, in fact, you just ignored that part). It's OK to admit you were wrong <3
        TimTheTinker 5y ago
jbay808 5y ago
It would be OK with me as long as I could buy back the government's stake in my house from the government by paying the tax in dollars.
lupire 5y ago
Huh? The government owns a percentage. The asset doesn't really matter. It would be a lein, to pay back at exit, not a voting share or whatever.
- TimTheTinker 5y ago
  How is that different from capital gains tax? Unless you mean a series of leins incurred once a year based on price increases. But then an asset with high YoY volatility but no long-term gain would cause the lein sum to approach the value of the asset over many years, despite no material increase in price at exit. That makes no sense - the government profiting off of volatility alone. If that's not what you mean, how is what you mean different from standard capital gains tax?

teachingassist 5y ago

OK. You seem to be agreeing that this would be a fine system with those caveats. So: Exemptions specifically covering residency already exist in finance law. If you go bankrupt, you can still live in your house (only if you owned it, mind). The government, as soon as practical, can auction the stock it receives. Thus identifying its value and releasing the funds.

TimTheTinker 5y ago
> You seem to be agreeing that this would be a fine system with those caveats. I'm not advocating anything in particular. I'm only pointing out some potentially serious issues with the proposed system. Sure, primary residence could be excluded. But that doesn't change anything about what I said, except perhaps blunt the initial impact on the middle class. > The government, as soon as practical, can auction the stock it receives. Thus identifying its value and releasing the funds. Perhaps that could be part of the tax law. I doubt it would stay that way... once the government can own stocks and portions of real estate, I'm sure it will seek to incrementally increase its benefit from doing so. I shudder to imagine politician-beaurocrats as the most powerful hedge fund managers of tomorrow.
- teachingassist 5y ago
  > once the government can own stocks and portions of real estate, I'm sure it will seek to incrementally increase its benefit from doing so. There's nothing stopping the government from owning these things already (governments own plenty of real estate, in particular), so this seems like undue cynicism.
  - TimTheTinker 5y ago
    There's a big difference between agencies owning buildings within which to do business (or the BLM owning vast swaths of land for environmental preservation) and the IRS maintaining a real estate asset class. In fact there's almost no comparison to be made between the two.
    - teachingassist 5y ago
      Regarding the government's ownership of real estate, I suggest you are simply mistaken, e.g.: https://www.forbes.com/sites/bisnow/2017/04/11/solving-the-mystery-of-government-owned-real-estate/?sh=317b07cf2bd0 https://www.forbes.com/sites/bisnow/2017/04/11/solving-the-m...
      - TimTheTinker 5y ago
        That article is talking about local governments, not the federal government.
        teachingassist 5y ago
        Ctrl-F "federal government" suggests otherwise. This is now really a bad faith argument. You've moved the goalposts (again), and declared that your new goal wasn't met (when, in fact, you just ignored that part). It's OK to admit you were wrong <3
        TimTheTinker 5y ago

jbay808 5y ago

It would be OK with me as long as I could buy back the government's stake in my house from the government by paying the tax in dollars.

lupire 5y ago

Huh? The government owns a percentage. The asset doesn't really matter. It would be a lein, to pay back at exit, not a voting share or whatever.

TimTheTinker 5y ago
How is that different from capital gains tax? Unless you mean a series of leins incurred once a year based on price increases. But then an asset with high YoY volatility but no long-term gain would cause the lein sum to approach the value of the asset over many years, despite no material increase in price at exit. That makes no sense - the government profiting off of volatility alone. If that's not what you mean, how is what you mean different from standard capital gains tax?