3 ms·

> Of course, as your company continues to appreciate, you will be forced to continue reducing your ownership stake Why? In an hypothetical world where gettin

> Of course, as your company continues to appreciate, you will be forced to continue reducing your ownership stake Why? In an hypothetical world where getting a loan on an asset is impossible (or taxed the same as realizing the gains), you still don't get taxed on unrealized gains. You can leave your stock alone and you aren't forced to sell anything. Of course if you decide that now that you are worth a billion you must live like a billionaire, then yes, you will have to sell stock, reduce your influence in the company and pay tax on the gains. I don't see any problem with this? It offers a way for the stock owner to choose if they want to use the stock as power (don't touch it) or as cash (sell it), only taxing you when you opt for the later. edit: I realised I might have misread your post as defending the system allowing one to use unrealized gains to back a loan, hence enabling the buy/borrow/die loophole, when you are in fact defending against taxing unrealized gains. To me the obvious fix is to prevent those loans as discussed above: force people to choose how they want to use their assets, if they choose to use them to live like kings then they must pay tax.

travisb 2y ago
The fix in your edit isn't an obviously workable fix though. When talking about the rich, it's best to talk about private corporations -- because that's really how the operate. Firstly, do you want to prevent corporations from taking loans against their assets? Preventing that seems like it would be quite detrimental. Secondly, how do you differentiate legitimate corporate expenses from personal expenses? Is a billionaire having one of their corporations rent a yacht from another of their corporations for a business meeting with another CEO who just happens to also be their friend a legitimate business expense or a personal expense? What if the yacht rental company rented it to the CEO's company instead?

travisb 2y ago

The fix in your edit isn't an obviously workable fix though. When talking about the rich, it's best to talk about private corporations -- because that's really how the operate. Firstly, do you want to prevent corporations from taking loans against their assets? Preventing that seems like it would be quite detrimental. Secondly, how do you differentiate legitimate corporate expenses from personal expenses? Is a billionaire having one of their corporations rent a yacht from another of their corporations for a business meeting with another CEO who just happens to also be their friend a legitimate business expense or a personal expense? What if the yacht rental company rented it to the CEO's company instead?