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>We need a massive tax on investment property, something that'll require the house to become completely unaffordable to re-sell, so investing will have negative

>We need a massive tax on investment property, something that'll require the house to become completely unaffordable to re-sell, so investing will have negative returns due to taxation. Or far easier, just eliminate the Section 1031 like-kind exchange (U.S. tax provision that allows tax on realized gains on investment property to be deferred indefinitely). There's really no policy justification for it since long term capital gains already have a favorable tax rate, and in fact like kind exchanges for personal (non-real-estate) property have already been recently eliminated.

lsllc 4y ago
The big banks & investment funds will figure a way around it, meanwhile individuals and small businesses trying to grow will struggle. I know people who've used a 1031 exchange to sell a smaller location and move to a bigger/better version of the same. How about limiting 1031 exchanges to small business(es) (for some definition of small businesses that's actually meaningful).
- lotsofpulp 4y ago
  > The big banks & investment funds will figure a way around it What does this mean? How would they be able to postpone paying capital gains tax if the government said they had to pay capital gains tax at time of sale? How about eliminating it, removing an avenue for corruption and extra costs for auditing said avenues for corruption, and giving cash to someone if the goal is for the government to help someone?
  - lsllc 4y ago
    The same way that Trump, Bezos et. al. seem to be able to avoid paying taxes on most of their wealth, in that they generally find a way to recover profits without it being considered "income". https://www.propublica.org/article/billionaires-tax-avoidance-techniques-irs-files https://www.propublica.org/article/billionaires-tax-avoidanc... All I'm saying is that by eliminating the 1031 exchange, I suspect it'll hurt far more individuals and small businesses (resulting in stifled growth) and the "big boys" will simply use some other vehicle to continue avoid the taxes.
    - ryathal 4y ago
      There is currently no tax on wealth in the United States, so there is no tax to avoid on wealth.
amf12 4y ago
> Or far easier, just eliminate the Section 1031 like-kind exchange I don't agree this is the best way. Section 1031 benefits the usual homeowners as well as the investors. Do you own a primary home and want to upgrade? Too bad because when you sell, you will have less money to buy a bigger house. Most people will opt to upgrade when they can and rent out their old home, which won't solve the supply issue.
- medvezhenok 4y ago
  Section 1031 does not apply to primary residences, there's the primary residence exemption ($250K per person / $500K per couple) for that. So it would not affect the usual homeowners.

lsllc 4y ago

The big banks & investment funds will figure a way around it, meanwhile individuals and small businesses trying to grow will struggle. I know people who've used a 1031 exchange to sell a smaller location and move to a bigger/better version of the same. How about limiting 1031 exchanges to small business(es) (for some definition of small businesses that's actually meaningful).

lotsofpulp 4y ago
> The big banks & investment funds will figure a way around it What does this mean? How would they be able to postpone paying capital gains tax if the government said they had to pay capital gains tax at time of sale? How about eliminating it, removing an avenue for corruption and extra costs for auditing said avenues for corruption, and giving cash to someone if the goal is for the government to help someone?
- lsllc 4y ago
  The same way that Trump, Bezos et. al. seem to be able to avoid paying taxes on most of their wealth, in that they generally find a way to recover profits without it being considered "income". https://www.propublica.org/article/billionaires-tax-avoidance-techniques-irs-files https://www.propublica.org/article/billionaires-tax-avoidanc... All I'm saying is that by eliminating the 1031 exchange, I suspect it'll hurt far more individuals and small businesses (resulting in stifled growth) and the "big boys" will simply use some other vehicle to continue avoid the taxes.
  - ryathal 4y ago
    There is currently no tax on wealth in the United States, so there is no tax to avoid on wealth.

amf12 4y ago

> Or far easier, just eliminate the Section 1031 like-kind exchange I don't agree this is the best way. Section 1031 benefits the usual homeowners as well as the investors. Do you own a primary home and want to upgrade? Too bad because when you sell, you will have less money to buy a bigger house. Most people will opt to upgrade when they can and rent out their old home, which won't solve the supply issue.

medvezhenok 4y ago
Section 1031 does not apply to primary residences, there's the primary residence exemption ($250K per person / $500K per couple) for that. So it would not affect the usual homeowners.