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what if every interest increase from investments counts at the end of the year as "income" and is taxed at the normal 35% everyone else pays? Whether you let it
by gremlinsinc 5y ago
what if every interest increase from investments counts at the end of the year as "income" and is taxed at the normal 35% everyone else pays? Whether you let it stay in investments or pull it out? Then we wouldn't need to worry about collecting taxes only when pulling from retirement funds/etc because it's all taxed annually based on increase.
- gnicholas 5y agoIt seems like a simple solution! It gets tricky when you think about illiquid assets, especially those with few comparables, like fancy paintings or luxury real estate. Now you could say “well, we’ll just do this for XYZ types of assets, but not do it for the types of assets that are hard to value.” But if you do that, you create distortions that would lead people to have a huge preference for certain asset classes over others. Also, if you tax people on gains they have in good years, you have to also give people refunds in years when they lose money. Well, you don’t have to, but if you don’t then people will be much less likely to engage in risky ventures.