> This makes sense kind of, though. If you haven't realized any of your gains, what are you paying the tax with? True, but only in a philosophical sense. It's

> This makes sense kind of, though. If you haven't realized any of your gains, what are you paying the tax with? True, but only in a philosophical sense. It's an issue of pricing, and pricing securities assets to original purchase value is a falsehood. People are very happy when their stock price increases dramatically, or their home value increases; they don't say 'well, those aren't my assets; all I have is the $100 price I bought it at X years ago.' People are happy when it's securities for which they only have future options to buy.