4 ms·
Yes, but the difference is that borrowing against your unrealized investments is a way of dodging taxes. I think the tax code can handle that level of subtlety
by knodi123 5y ago
Yes, but the difference is that borrowing against your unrealized investments is a way of dodging taxes. I think the tax code can handle that level of subtlety without paying attention to your flippant reductio ad absurdum.
- imgabe 5y agoSure and borrowing $750k to buy a house is a nifty way for me to get $750k without having to pay income taxes on $750k worth of income. What an amazing loophole that gives me completely free money and no taxes! What the government could do is stop loaning out money at 0% (i.e. printing free money which inflates assets, like stocks held by wealthy people). If the prime rate increased, the rate banks would charge on asset-backed loans would also increase, which would make it less attractive than just selling the asset and paying the capital gains tax.
- knodi123 5y ago> Sure and borrowing $750k to buy a house is a nifty way for me to get $750k without having to pay income taxes on $750k worth of income. That's now how borrowing money to buy a house works.
- imgabe 5y agoYeah and “free money you never pay taxes on” is not how borrowing against stocks works either