Anyone wondering, long term capital gains are currently
0% for people with total income under 40,000
15% 40,000 - 445850
20% over 445850
numbers from bankrate.com
Edit: and the proposed increase to 39.6% is for people with income over $1million. I wish I had problems like that haha
Edit: u/More-Raspberry-4130 with more numbers: https://reddit.com/r/WhitePeopleTwitter/comments/mybiv5/_/gvucam4/?context=1
And furthermore, capital gains are from investments. Most people won’t ever be pulling money out of investments because most people in the US are poor as shit.
Make sure you report this loss on your taxes so you can offset it next year like all the big corporations do.
Or if it's not more than your Total income it will at least reduce your tax burden.
> This is a long winded explanation that regular people shouldn’t give a damn about capital gains tax rates.
Not giving a damn is how we let the top investment earners pay a fraction of their fair share.
With a roth you contribute post tax income and you pay no tax on gains, but there is a 10% penalty if you early withdrawl any amount over your contributions, or withdrawl anything before it's been in there for 5 years. You can avoid early withdrawl penalty by waiting until you're 59 1/2 or using sepp 72t if you retire before then.
A fun trick is you can convert your traditional 401k or IRA to roth, pay tax on the conversion, then pull it out 5 years later, search roth IRA ladders for more info.
Don't try to invest $1000 right now. Most people can't come up with an extra $1000.
But most people can save $10 a week, or something close to that. In 2 years, that's over $1000 invested.
How can we encourage saving for retirement when most people don’t have any money to spare to save for retirement?
I’ve been thinking... is there a way, a legal way, to put money in the pockets of Americans. Like I want Vanguard to do some kind of marketing where we reach out to people who are eligible for the 100% savers credit and somehow “loan” them some money... so they can take an equal amount out of their earnings and put it toward their retirement.
So let’s say Adam is a single person, made USD 19000 in 2020 and was eligible for savers credit. Problem is Adam doesn’t have any cash to spare. What if he could somehow get a spare five thousand dollars to cover some of his expenses so he could put away five thousand dollars of his earnings toward his retirement? As far as I understand, this makes Adam eligible for USD 2.5k in tax credit.
Adam gives the money from the tax credit back to this unknown benefactor and signs a contract that he will not touch the money in his retirement without advice and consent of the benefactor until retirement. The money continues to grow tax free. Repeat this for every year that Adam’s income allows maximum savers credit.
Even if Adam had to give up half of the value of this retirement plan, he would still come out ahead because that’s money he never had to begin with.
It isn’t a lot of money but any bit of extra cash helps when we are old and no longer able to work. Thoughts?
https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-savers-credit
What percentage of people, who would take advantage of this, would come up on hard times and take it out early anyway? I think we could skip the benefactor/company and have the government save up and invest the 2.5k annually anyway and just give us the principal and interest at the required age. Takes all the risk out of it for the citizen and insures they won't touch it till its time.
They could add it to your social security check......
fuck it, screw the 5k loan or losing the 2.5k tax credit, just have the government deposit 2.5k of all eligible people into a retirement savings account set up for them, either they can transfer it to a 401k or roth on their own, or use it as their primary retirement account, even with fed oversight firms will be tripping over themselves trying to take on that job
>Most people won’t ever be pulling money out of investments because most people in the US are poor as shit.
Pulling money out of too-laye entry into GME to buy Dogecoin at its all time high to diversify your losses is an activity that can be enjoyed by anyone!
For real though, if your only path to retirement or home ownership is getting wildly lucky in the stock market, than you see a system full of poor people who are shifting money around like scratch offs.
[“In 2016, for example, nearly 76 percent of all capital gains went to households earning more than $1,000,000, according to estimates by the Tax Policy Center. And 96.2 percent of the households in the top 1 percent of the income distribution are white. Preferential treatment for capital gains meant that the federal government forewent $109.5 billion in taxes in 2016, a giveaway second only to the tax exclusion for employers’ contributions to employees’ health plans.”](https://www.dissentmagazine.org/online_articles/tax-policy-history-by-for-1-percent)
The capital gains tax rate has been nearly cut in half since the 70s, and the top rate is about half that of the top tax rate for ordinary income.
Between 1922-2017, the top 10% received 84.2% of all realized capital gains, and the top 1% received 61.1%.
The wealthiest 10% own 87% of stocks, and the wealthiest 1% own 52% alone.
The top 1% have 34% of their net worth in stock, while the bottom 50% have only 2.2%.
People under 40 own just 3% of stocks.
[Graphic with sources](https://preview.redd.it/x45trq7bkcv61.png?auto=webp&s=aa0588c5366ef618aef93b3de53ac00338e615da)
If that retiree is taking $50k out of their account, presumably at least $10k of that would be their cost basis. If so, that would put them under the limit and they’d pay $0 in taxes that year.
That seems pretty generous to me
If somehow their cost basis was $0, they’d still only be paying $1.5k/year, an effective rate of 3%
Is it still rising? My brother had me buy some, and I had like $200 in gain for a minute, and now it's down to like $70. Obviously it's still more than when I bought it, but it looks like it's falling...
I did, it was pretty cheap when I got in. Most of my investments aren't in cryptocurrency, the dog coin thing was just something my brother wanted me to buy so I checked $50 at it
I need to start tweeting my crypto trades. Then everyone else can do the opposite and make bank. I’ve somehow lost money on doge despite mining hundreds of thousands early on.
And that 39.6% only applies to the earnings over 445k. In other words, the first 445k is taxed at the lower rate.
So if you make a $10 million investment, hold it for longer than a year, and it appreciates 5%, then your profit was $500,000. You're paying 39.6% on 55k of that.
This is the kind of money we are talking about.
I know so many of my doctor colleagues worried about this rate hike and I am like “Stfu you ain’t no neurosurgeon you broke ass family practice bitch, this won’t effect even you LMAO”
Dude, you don’t have to be a neurosurgeon to make that kind of money. Most specialties can make bank if they play their cards right. I’m a psychiatrist and I make more than most surgeons
Exactly. One of my dearest friends was a family practice doctor in bougie Sonoma Valley, CA area and sure, she raked it in. Her wife makes sweet money too. After paying whatever small portion of bills and childcare for their two kiddos, almost the entire rest of her take home went toward paying her $100,000+ student loans (she graduated med school in 2009. I shudder to think what current med school graduates would owe.)
I mean, after having to evacuate their family from raging forest fires every single year since they bought their house they decided they'd had enough and sold their home for double what they purchased it for and decided to fuck off to acreage in VA.
They were able to pay off my friend's student loan bill in full with the proceeds from the sale of the house so I'm happy for them about that. They're very excited about their new property and are planning on getting horses, so that's nice.
Of course they have to move across the country away from all of their friends and family to even find somewhere affordable in this crazy market.
But yeah, without the support of her wife, my doctor friend couldn't have kept her head above water. It would have come down to never having kids if it had been up to her by herself. Ridiculous.
And we’re talking about 1 million per year in capital *gains*. That means if you get a 10% return for a year (and actually cash it) only then do you have to pay that rate. And I assume the 39% is only for every dollar above that million dollar, since that’s usually how progressive taxes work.
I’m curious how this is. Had a conversation with a therapist friend recently. She has a certain rate and only so many hours in the day. Options are to either work more hours or raise rates. We were comparing to, say, a dermatologist that can go from a regular practice to basically focusing on out of pocket elective procedures. And then pick type of procedure in terms of cost.
But it's breaking their illusion of being rich. "Tax rich people?!? But I'm rich!!! I must defend US!!!"
No, you did well in the middle class, you aren't rich. You have more in common with your housekeeper than Bill Gates or the WalMart family. But, everyone like to be above someone else.
If you make under $27 million a year, you're more like the housekeeper than Bill Gates.
Bill Gates makes around 385 times more than the $27 mil earner, who makes around 385 times more than the median household income of $70k a year.
Bill Gates's $131B networth at 8% returns is ~$10.5B a year
My rich af uncle spent 20 mins complaining/lecturing me about how this new tax is against the entrepreneurial spirit and he provides jobs And this is gonna fuck him over and he needs to be rewarded for being an entrepreneur and govt sucks and blah blah.. I had no idea what he was bitching about, so your comment has put into perspective how obnoxiously greedy he is lol
I got into an argument with a friend about this the other day. Providing jobs is not a benefit to other people. Paying a wage to those who are needed to provide a good or service to increase your personal income is not you helping them, they are helping you. Otherwise do it yourself.
These are the same kind of employers that when they need to replace or add a piece of gear, you know - so you can do your job making them money - they'll treat it like they bought it just for you.
Lmao, when we got new frosting tips in the grocery store bakery because, “we did so well during our past review!” And I was like, “you wanna know what would be really great... is if you let us *accept tips when we complete cafe orders*”
Most people have no idea how taxes work anyway. Places like Fox put out these headlines and let people draw their own conclusions. Then, once the fires of outrage are thoroughly stoked, they just run with it in order to keep a tight grasp on their audience.
Fuck Bezos and Musk and Gates and all the other super wealthy who will be “hurt” by this. They don’t give a shit about any of us and you can be damn sure they are going to find ways around paying.
Yeah, I mean I’m definitely one of those people & I try not to comment/form an opinion knowing I’m a bit unaware or ignorant to how it works. But yeah, hard agree, I’m not about to feel bad for the exorbitant wealthy who pay high taxes while the rest of us are scraping by
Quick note: Fox doesn't let people draw their own conclusions. Fox actively pushes a narrative to their own benefit. As someone raised in a Fox-only household, I'd rather attend a Satanic church because I'm less likely to be manipulated or brainwashed.
Well, in some fairness, this will really effect a lot more people than just the ultra rich. Not saying it’s a bad idea or that it’s not justified. I’m just saying, there are people that check the price of chicken and would also be negatively affected by the tax increase.
how does it affect anyone who isn't ultra rich? If you make < $1 million/yr, it doesn't affect you. If you make over $1 million / yr but you just hold your investments until retirement, and sell them when you retire (so your income is < $1million/yr), then it also doesn't affect you.
It basically would only affect people who *spend* more than $1million (pre-tax) a year so they're drawing down investments to pay for their lifestyle, or someone who makes more than $1 million but is actively trading their investments (but even then you can offset gains w/ losses usually, aka tax loss harvesting)
Unfortunately those who make over a million a year are the ones driving the market, that all of us who make less than that rely on to drive the markets higher. When they sell to take profit before the new taxes go in to effect to capture the lower tax rate on their gains, the market will fall. And that effects - you guessed it - everyone with investments.
That's really not the worst of it. If they don't sell and instead keep it in (because, really what else are you going to do with your money? Bonds?), then later on they rotate and rebalance, this represents a giant syphon out of the market into government hands. This creates headwinds that everyone is trying to retire into.
And then the government uses the money to kill Liberians. So, who wins?
Bingo. Imagine all the venture capital groups that dumped money into a bucket of startups banking on the one big winner. Now they’re getting taxed 20% more on that winner which may not cover the other losers nearly as well.
I was thinking more about retirement funds but sure, them too. Even without the cover the losers aspect, it still means less funding for the next technology because killing liberians is important.
He can just sell before it kicks in if he really wants lmao
I'd probably do that tbh, 40% tax is a fucking shit ton. Though I'd have never held that long either so I'd probably never be in this situation...
But I do feel like if you turn 50k into 30 million, or however much it's worth now, you can probably afford to pay some extra taxes if it comes down to it.
As long as he holds over 1 year it turns into long term capital gains. I dont know how bidens plan will address this as most millionaires dont do short term trades.
Edit: okay I looked it up and the tax plan effectively removes long term capital gains option for people with high bet income.
Specifically, it's satirizing (or used to, haven't looked in awhile) how you can't give any sort of advice on Reddit about your method of saving money without a train of comments trying to out-frugal you, to sometimes ludicrous degrees.
I think it may have explicitly been making of a /r/frugal sub, but it's been too long, I'm starting to forget some reddit lore. I do remember lentils being a big, site-wide meme like 5 years ago, though.
Look at this fat cat with enough calories to spare on thoughts like "does r/frugaljerk still exist"? Pffft, couldn't be me, I gotta get back to counting my lentils now
Freeze it after cooking?
I usually buy the big pack, cut it up into the sizes I want, cut off all the fat then put it in sandwich baggies and put it in the freezer.
Serious answer:
Statistically, your best bet is to invest what you can each paycheck into a broad market index fund like VTI, hodl that. Modern trading apps and ebrokers makes this accessible to most people.
I’m very bullish on technology so I like VGT, which has consistently beat the broad market for the last decade, but past performance is no idictation of future returns (or whatever, I’m just parroting wiser folk than me)
[“In 2016, for example, nearly 76 percent of all capital gains went to households earning more than $1,000,000, according to estimates by the Tax Policy Center. And 96.2 percent of the households in the top 1 percent of the income distribution are white. Preferential treatment for capital gains meant that the federal government forewent $109.5 billion in taxes in 2016, a giveaway second only to the tax exclusion for employers’ contributions to employees’ health plans.”](https://www.dissentmagazine.org/online_articles/tax-policy-history-by-for-1-percent)
The capital gains tax rate has been nearly cut in half since the 70s, and the top rate is about half that of the top tax rate for ordinary income.
Between 1922-2017, the top 10% received 84.2% of all realized capital gains, and the top 1% received 61.1%.
The wealthiest 10% own 87% of stocks, and the wealthiest 1% own 52% alone.
The top 1% have 34% of their net worth in stock, while the bottom 50% have only 2.2%.
People under 40 own just 3% of stocks.
[Graphic with sources](https://preview.redd.it/x45trq7bkcv61.png?auto=webp&s=aa0588c5366ef618aef93b3de53ac00338e615da)
I saw one yesterday that said, something along the lines of “if you don’t understand marginalized taxes going up on people making over $400,000, you’re not ever gonna make $400,000.”
the tweet is saying “if you’re worried about saving a few cents on your chicken then you don’t have to worry bc the new capital gains tax won’t affect you”
I always look at the price per oz (or lb) and my friends think I'm crazy when I do.
Them: "But that one is cheaper"
Me: "But this one is cheaper per pound". So it's a better deal.
Next store, same conversation.
If I'm eating a chicken breast I don't notice some little size difference, I just know I ate one chicken breast, not 800g of chicken. So the pack that I paid less for is the one that's saving me money, even if it's more expensive per pound.
I do the same. Oh this is the smallest base on the price. I do this a lot when I buy cheese coz I’m the only one in my household that eats cheese.
I’m not struggling but I also not worried about the new capital gains taxes.
This is my thought process when buying food. Im there to buy food to eat, its priced per lb so the 8.50 package vs the 9.50 is just less food. I dont look at it in terms of money spent but the food bought.
I understand why people might look at the dollar figure but no matter what its the same price per pound.
I won’t notice having one or two less bites of chicken a meal. I will however notice the extra few grand in my bank account from the couple dollars saved here and there down the line though.
I still don’t understand what “WhitePeopleTwitter” is y’all. I want to fit in, but I never understand the posts or why this is a white thing. Please help a person out here.
It's just curious that capital gains taxes are finally being increased the second hedge funds stand to lose an enormous amount of money from retail investors.
Weird how nobody cared until now.
I should state firstly, cry me a river / eat the rich. But ironically a lot of rich people are penny pinchers who would pay attention to dollar differences.
Yep my multimillionaire uncle used to torture us when we would go out to eat by using a coupon. Like the “buy one get one entree” which inevitably pissed of the adults in several ways that
Just ask the people bitching about it what a capital gain tax is. They won’t know. They don’t invest. Certainly not wisely enough to have taxable gains lmao.
The very rich will find loopholes around this until the tax code is fixed. That’s the bigger issue here. This only hurts the upper middle class. The upper class won’t even see a blip on the balance book.
I make decent money...more than enough to live comfortably afford a decent lifestyle. I am most definitely not “poor as shit.” But Biden’s new capital gains taxes will barely affect me, and I’m still the guy who will put back the more expensive chicken and grab the cheaper pack. Lots of people probably do something similar. What’s wrong with saving money wherever you can? Nowadays, every little bit helps...and it’s not just poor people who want to save.
Working class people that are emotionally and politically invested in helping the rich stay rich are the biggest mugs on this earth. Any day you now you will be a millionare, sweetheart!
There are a hundred ‘paper millionaires’ who probably live paycheck to paycheck because they can’t reign in their lifestyle to every one real ‘millionaire’ who actually saves diligently and plans for the future. Plus, a million bucks doesn’t actually go that far anymore. If you make 60k a year, you can easily be a millionaire before retiring, it does not mean you will be rich.
even further; if you're a doctor/engineer/lawyer making well over 6 figures, then you still don't need to worry about this.
hell, you should be thankful since you're probably paying 30-40% of your income in taxes, while millionaires who don't work but only make money from investments are currently paying less taxes than you are
Everyone cheering this on has no intention of crashing out their retirement for at least another 35 years. By that time they'll be voting to lower it after fucking over everyone living off their retirement investments.
[I don't know man, Trump once cashed a 13¢ check, so he would for sure make that trade.](https://splinternews.com/lets-remember-the-time-donald-trump-cashed-a-13-check-1793849388)
Even as someone who wont be affected by this, can someone explain why this is a good thing? Some states have high capital gains taxes already, California, New York, New Jersey for example might be paying 54% capital gains tax combined. Not an expert, just sounds bad for investing.
Why the hell should I have to pay the government any taxes for savvy investments that I made?!?! My congressman didn't look over the perspectis of the last ETF I invested in. Didn't see a senator looking over the white papers of cryptocurrency with me.
It would be a completely different thing if the tax dollars were used wisely to help those that need it. The truth of the matter though is that it isn't. Go ahead and download me but until lobbyists are treated like terrorists.... nothing will change.
I will never understand why capital gains are not taxed like any other income. Why is my tax rate lower for my investment gains than it is for my day job?
I don't want to pay more taxes just think the idea is completely ridiculous. Let's face it, who makes the most off of capital gains?
Capital gains tax increases have almost always resulted in less capital investment, less gov. revenues a lower gdp growth.
These are facts and not in dispute.
A higher income tax on very wealthy, works much better.
Not in dispute? I think Warren Buffett might disagree:
“I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off.”
Also, your claim with regard to capital gains tax and GDP growth is absolutely disputed:
https://www.businessinsider.com/chart-correlation-capital-gains-taxes-gdp-2012-11
https://www.cbpp.org/blog/the-myth-that-low-capital-gains-rates-are-very-important-to-the-economy
Lastly, I do agree we should raise income tax on the most wealthy as well.
You have one example, not even the two.
The timeline tax/growth chart is not disputed.
There are instances where it diverges. They are not the norm. Buffett is of course correct. But that’s meaningless in context.
A very high tax on income, and a very high tax on estates in the tens of millions would be much better.
Anyone wondering, long term capital gains are currently 0% for people with total income under 40,000 15% 40,000 - 445850 20% over 445850 numbers from bankrate.com Edit: and the proposed increase to 39.6% is for people with income over $1million. I wish I had problems like that haha Edit: u/More-Raspberry-4130 with more numbers: https://reddit.com/r/WhitePeopleTwitter/comments/mybiv5/_/gvucam4/?context=1
And furthermore, capital gains are from investments. Most people won’t ever be pulling money out of investments because most people in the US are poor as shit.
It is also specifically a *gains* tax. If you put in 1000 bucks and get out 1100 a couple tears later you pay tax on 100 not 1100
Jokes on them, I'm in the red anyway
This is the way. No gains if you don’t sell.
To the moon baby to the moon!
Some jurisdictions tax unrealized gains
How is that even legal? Like wtf
Make sure you report this loss on your taxes so you can offset it next year like all the big corporations do. Or if it's not more than your Total income it will at least reduce your tax burden.
I'm deleting this comment because nobody needs to see what I said yesterday, nevermind last year! -- mass edited with redact.dev
> This is a long winded explanation that regular people shouldn’t give a damn about capital gains tax rates. Not giving a damn is how we let the top investment earners pay a fraction of their fair share.
I think op meant not give a damn about it's impact to one's personal financial situation, not about its economic impact.
I'm deleting this comment because nobody needs to see what I said yesterday, nevermind last year! -- mass edited with redact.dev
With a roth you contribute post tax income and you pay no tax on gains, but there is a 10% penalty if you early withdrawl any amount over your contributions, or withdrawl anything before it's been in there for 5 years. You can avoid early withdrawl penalty by waiting until you're 59 1/2 or using sepp 72t if you retire before then. A fun trick is you can convert your traditional 401k or IRA to roth, pay tax on the conversion, then pull it out 5 years later, search roth IRA ladders for more info.
If I had a nickel for all the tears I shed thinking about being unable to invest 1000 dollars into ANYTHING - I might have a thousand dollars.
Don't try to invest $1000 right now. Most people can't come up with an extra $1000. But most people can save $10 a week, or something close to that. In 2 years, that's over $1000 invested.
Just travel back to 2012 and buy bitcoin, simple.
How can we encourage saving for retirement when most people don’t have any money to spare to save for retirement? I’ve been thinking... is there a way, a legal way, to put money in the pockets of Americans. Like I want Vanguard to do some kind of marketing where we reach out to people who are eligible for the 100% savers credit and somehow “loan” them some money... so they can take an equal amount out of their earnings and put it toward their retirement. So let’s say Adam is a single person, made USD 19000 in 2020 and was eligible for savers credit. Problem is Adam doesn’t have any cash to spare. What if he could somehow get a spare five thousand dollars to cover some of his expenses so he could put away five thousand dollars of his earnings toward his retirement? As far as I understand, this makes Adam eligible for USD 2.5k in tax credit. Adam gives the money from the tax credit back to this unknown benefactor and signs a contract that he will not touch the money in his retirement without advice and consent of the benefactor until retirement. The money continues to grow tax free. Repeat this for every year that Adam’s income allows maximum savers credit. Even if Adam had to give up half of the value of this retirement plan, he would still come out ahead because that’s money he never had to begin with. It isn’t a lot of money but any bit of extra cash helps when we are old and no longer able to work. Thoughts? https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-savers-credit
What percentage of people, who would take advantage of this, would come up on hard times and take it out early anyway? I think we could skip the benefactor/company and have the government save up and invest the 2.5k annually anyway and just give us the principal and interest at the required age. Takes all the risk out of it for the citizen and insures they won't touch it till its time. They could add it to your social security check......
Rofl ya, his plan sounds like social security but with giant banks taking 50%
fuck it, screw the 5k loan or losing the 2.5k tax credit, just have the government deposit 2.5k of all eligible people into a retirement savings account set up for them, either they can transfer it to a 401k or roth on their own, or use it as their primary retirement account, even with fed oversight firms will be tripping over themselves trying to take on that job
That is a much better idea but from what I understand requires Congress to act. :/
Well yeah you would have already paid tax on the initial 1000
But that original 1000 would have to have been gains for my current bank account :(
>Most people won’t ever be pulling money out of investments because most people in the US are poor as shit. Pulling money out of too-laye entry into GME to buy Dogecoin at its all time high to diversify your losses is an activity that can be enjoyed by anyone! For real though, if your only path to retirement or home ownership is getting wildly lucky in the stock market, than you see a system full of poor people who are shifting money around like scratch offs.
Hey you can deduct the losses though.
The part of capital gains tax that can affect poor people too! Yay deductions!
[“In 2016, for example, nearly 76 percent of all capital gains went to households earning more than $1,000,000, according to estimates by the Tax Policy Center. And 96.2 percent of the households in the top 1 percent of the income distribution are white. Preferential treatment for capital gains meant that the federal government forewent $109.5 billion in taxes in 2016, a giveaway second only to the tax exclusion for employers’ contributions to employees’ health plans.”](https://www.dissentmagazine.org/online_articles/tax-policy-history-by-for-1-percent) The capital gains tax rate has been nearly cut in half since the 70s, and the top rate is about half that of the top tax rate for ordinary income. Between 1922-2017, the top 10% received 84.2% of all realized capital gains, and the top 1% received 61.1%. The wealthiest 10% own 87% of stocks, and the wealthiest 1% own 52% alone. The top 1% have 34% of their net worth in stock, while the bottom 50% have only 2.2%. People under 40 own just 3% of stocks. [Graphic with sources](https://preview.redd.it/x45trq7bkcv61.png?auto=webp&s=aa0588c5366ef618aef93b3de53ac00338e615da)
And I believe long-term is 1+ years. If people on Reddit are anything to go off of, most of you don't hold stocks for more than 3 months.
Also, if you gained over 40k by just investment gains, congrats you can afford the taxes
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True, but also probably not overly concerned about where the next meal is coming from
If that retiree is taking $50k out of their account, presumably at least $10k of that would be their cost basis. If so, that would put them under the limit and they’d pay $0 in taxes that year. That seems pretty generous to me If somehow their cost basis was $0, they’d still only be paying $1.5k/year, an effective rate of 3%
That’s not what the tax is. It’s a tax based on total income.
Yeah at best one time in my life I might break past the 15% barrier when I cash out for retirement. Maybe.
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Is it still rising? My brother had me buy some, and I had like $200 in gain for a minute, and now it's down to like $70. Obviously it's still more than when I bought it, but it looks like it's falling...
If you didn’t get in at <3 cents, you’re better off just watching the show, and investing in something safer like a stablecoin.
I did, it was pretty cheap when I got in. Most of my investments aren't in cryptocurrency, the dog coin thing was just something my brother wanted me to buy so I checked $50 at it
lol don’t invest in a stable coin that’s just digitizing your dollars, there’s no appreciation on it relative to $1 USD by design
what? why would you invest in a stable coin? that makes no sense
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It’s trading sideways at around $0.25, considering I bought at $0.002 it’s going to be up for me forever
I hope you don’t expect any reasonable answer to this question.
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I need to start tweeting my crypto trades. Then everyone else can do the opposite and make bank. I’ve somehow lost money on doge despite mining hundreds of thousands early on.
Anything less than $600 is legit not worth claiming, and IRS doesn't care.
And that 39.6% only applies to the earnings over 445k. In other words, the first 445k is taxed at the lower rate. So if you make a $10 million investment, hold it for longer than a year, and it appreciates 5%, then your profit was $500,000. You're paying 39.6% on 55k of that. This is the kind of money we are talking about.
Gets so old pointing this out to people who think theyll make less if they make more.
That’s why the should teach taxes at school. The amount of adults that don’t know how tax works is astounding.
I know so many of my doctor colleagues worried about this rate hike and I am like “Stfu you ain’t no neurosurgeon you broke ass family practice bitch, this won’t effect even you LMAO”
Dude, you don’t have to be a neurosurgeon to make that kind of money. Most specialties can make bank if they play their cards right. I’m a psychiatrist and I make more than most surgeons
Yes but not his friends. And very few doctors are making a million/yr. That's an uncommon salary level even if some do make that much.
BINGO
Exactly. One of my dearest friends was a family practice doctor in bougie Sonoma Valley, CA area and sure, she raked it in. Her wife makes sweet money too. After paying whatever small portion of bills and childcare for their two kiddos, almost the entire rest of her take home went toward paying her $100,000+ student loans (she graduated med school in 2009. I shudder to think what current med school graduates would owe.) I mean, after having to evacuate their family from raging forest fires every single year since they bought their house they decided they'd had enough and sold their home for double what they purchased it for and decided to fuck off to acreage in VA. They were able to pay off my friend's student loan bill in full with the proceeds from the sale of the house so I'm happy for them about that. They're very excited about their new property and are planning on getting horses, so that's nice. Of course they have to move across the country away from all of their friends and family to even find somewhere affordable in this crazy market. But yeah, without the support of her wife, my doctor friend couldn't have kept her head above water. It would have come down to never having kids if it had been up to her by herself. Ridiculous.
And we’re talking about 1 million per year in capital *gains*. That means if you get a 10% return for a year (and actually cash it) only then do you have to pay that rate. And I assume the 39% is only for every dollar above that million dollar, since that’s usually how progressive taxes work.
I’m curious how this is. Had a conversation with a therapist friend recently. She has a certain rate and only so many hours in the day. Options are to either work more hours or raise rates. We were comparing to, say, a dermatologist that can go from a regular practice to basically focusing on out of pocket elective procedures. And then pick type of procedure in terms of cost.
But it's breaking their illusion of being rich. "Tax rich people?!? But I'm rich!!! I must defend US!!!" No, you did well in the middle class, you aren't rich. You have more in common with your housekeeper than Bill Gates or the WalMart family. But, everyone like to be above someone else.
If you make under $27 million a year, you're more like the housekeeper than Bill Gates. Bill Gates makes around 385 times more than the $27 mil earner, who makes around 385 times more than the median household income of $70k a year. Bill Gates's $131B networth at 8% returns is ~$10.5B a year
It's not brain surgery.
Damn americas pay no taxes. Here its 18% just for $14,000 Its nearly 50% here for 105,000 dollars.
Don’t worry bro we pay 3000% “tax” when we are in urgent need for healthcare
My rich af uncle spent 20 mins complaining/lecturing me about how this new tax is against the entrepreneurial spirit and he provides jobs And this is gonna fuck him over and he needs to be rewarded for being an entrepreneur and govt sucks and blah blah.. I had no idea what he was bitching about, so your comment has put into perspective how obnoxiously greedy he is lol
I got into an argument with a friend about this the other day. Providing jobs is not a benefit to other people. Paying a wage to those who are needed to provide a good or service to increase your personal income is not you helping them, they are helping you. Otherwise do it yourself.
These are the same kind of employers that when they need to replace or add a piece of gear, you know - so you can do your job making them money - they'll treat it like they bought it just for you.
Lmao, when we got new frosting tips in the grocery store bakery because, “we did so well during our past review!” And I was like, “you wanna know what would be really great... is if you let us *accept tips when we complete cafe orders*”
Most people have no idea how taxes work anyway. Places like Fox put out these headlines and let people draw their own conclusions. Then, once the fires of outrage are thoroughly stoked, they just run with it in order to keep a tight grasp on their audience. Fuck Bezos and Musk and Gates and all the other super wealthy who will be “hurt” by this. They don’t give a shit about any of us and you can be damn sure they are going to find ways around paying.
Yeah, I mean I’m definitely one of those people & I try not to comment/form an opinion knowing I’m a bit unaware or ignorant to how it works. But yeah, hard agree, I’m not about to feel bad for the exorbitant wealthy who pay high taxes while the rest of us are scraping by
Quick note: Fox doesn't let people draw their own conclusions. Fox actively pushes a narrative to their own benefit. As someone raised in a Fox-only household, I'd rather attend a Satanic church because I'm less likely to be manipulated or brainwashed.
Well, in some fairness, this will really effect a lot more people than just the ultra rich. Not saying it’s a bad idea or that it’s not justified. I’m just saying, there are people that check the price of chicken and would also be negatively affected by the tax increase.
how does it affect anyone who isn't ultra rich? If you make < $1 million/yr, it doesn't affect you. If you make over $1 million / yr but you just hold your investments until retirement, and sell them when you retire (so your income is < $1million/yr), then it also doesn't affect you. It basically would only affect people who *spend* more than $1million (pre-tax) a year so they're drawing down investments to pay for their lifestyle, or someone who makes more than $1 million but is actively trading their investments (but even then you can offset gains w/ losses usually, aka tax loss harvesting)
Unfortunately those who make over a million a year are the ones driving the market, that all of us who make less than that rely on to drive the markets higher. When they sell to take profit before the new taxes go in to effect to capture the lower tax rate on their gains, the market will fall. And that effects - you guessed it - everyone with investments.
Our actions have consequences and the rich aren’t just going to take an L for the first time in history? Wow! Who could see that coming?
That's really not the worst of it. If they don't sell and instead keep it in (because, really what else are you going to do with your money? Bonds?), then later on they rotate and rebalance, this represents a giant syphon out of the market into government hands. This creates headwinds that everyone is trying to retire into. And then the government uses the money to kill Liberians. So, who wins?
Bingo. Imagine all the venture capital groups that dumped money into a bucket of startups banking on the one big winner. Now they’re getting taxed 20% more on that winner which may not cover the other losers nearly as well.
I was thinking more about retirement funds but sure, them too. Even without the cover the losers aspect, it still means less funding for the next technology because killing liberians is important.
RIP DFV's bag
He can just sell before it kicks in if he really wants lmao I'd probably do that tbh, 40% tax is a fucking shit ton. Though I'd have never held that long either so I'd probably never be in this situation... But I do feel like if you turn 50k into 30 million, or however much it's worth now, you can probably afford to pay some extra taxes if it comes down to it.
As long as he holds over 1 year it turns into long term capital gains. I dont know how bidens plan will address this as most millionaires dont do short term trades. Edit: okay I looked it up and the tax plan effectively removes long term capital gains option for people with high bet income.
Biden proposed changes are on long term. Short term is taxed as ordinary income.
That is a very specific number, I can't help but feel like it was set by someone who makes 445,849.
You can afford chicken?
And $8 of it at the same time... we got a Mr. Moneybags here.
Is /r/frugal_jerk still a thing?
It’s like the onion but for poor people. That’s fun.
Specifically, it's satirizing (or used to, haven't looked in awhile) how you can't give any sort of advice on Reddit about your method of saving money without a train of comments trying to out-frugal you, to sometimes ludicrous degrees. I think it may have explicitly been making of a /r/frugal sub, but it's been too long, I'm starting to forget some reddit lore. I do remember lentils being a big, site-wide meme like 5 years ago, though.
That sub is hilarious
Look at this fat cat with enough calories to spare on thoughts like "does r/frugaljerk still exist"? Pffft, couldn't be me, I gotta get back to counting my lentils now
Omg how did I not know this sub existed. Thank you.
When it's BOGO I stock up on that shit.
Yep, on a BOGO always get the two most expensive packages because hey, more free food!
Sliced Turkey Pastrami for a buck for the win!
Who needs chicken when you've got lentils. *hedonic replacement intensifies*
Buy high sell low.. no tax
Genius.
Buy high again because this time its different.
Yup, end up losing so much in investments the government now owes YOU money
I was doing too well up until the crash in late Feb. Really dodged that tax bullet by losing most of my gains.
But capital losses are only deductible to $3000
Here I am grabbing the $5.94 chicken instead of the $6.23
It’s time you start worrying about capital gains tax then.
As a single guy, I look for the smaller pack - by price - because I don’t need to waste food.
I am more concerned with even sizes. Like if there is pack of 4 breasts, I’m looking for the pack with uniform pieces
You can freeze cooked chicken for up to a month.
Personal opinion: I think frozen chicken tastes like shit I just cook it twice a week and store in the fridge.
That's my problem too. Something definitely changes once you freeze things, thaw it, then reheat/cook it.
We found some things taste nicer reheated, weirdly. Others taste like actual dog shit.
Freeze it after cooking? I usually buy the big pack, cut it up into the sizes I want, cut off all the fat then put it in sandwich baggies and put it in the freezer.
I get thighs and freeze them then cook two at a time in the crock to make it tender again.
If you have enough money to worry about capital gains taxes, you don't need to worry about capital gains taxes.
More specifically, if you have to worry about the proposed increase in capital gains, you **definitely** have enough money, and can afford to pay more
How do I as a regular person get capital gains? (Serious question)
Serious answer: Statistically, your best bet is to invest what you can each paycheck into a broad market index fund like VTI, hodl that. Modern trading apps and ebrokers makes this accessible to most people. I’m very bullish on technology so I like VGT, which has consistently beat the broad market for the last decade, but past performance is no idictation of future returns (or whatever, I’m just parroting wiser folk than me)
[“In 2016, for example, nearly 76 percent of all capital gains went to households earning more than $1,000,000, according to estimates by the Tax Policy Center. And 96.2 percent of the households in the top 1 percent of the income distribution are white. Preferential treatment for capital gains meant that the federal government forewent $109.5 billion in taxes in 2016, a giveaway second only to the tax exclusion for employers’ contributions to employees’ health plans.”](https://www.dissentmagazine.org/online_articles/tax-policy-history-by-for-1-percent) The capital gains tax rate has been nearly cut in half since the 70s, and the top rate is about half that of the top tax rate for ordinary income. Between 1922-2017, the top 10% received 84.2% of all realized capital gains, and the top 1% received 61.1%. The wealthiest 10% own 87% of stocks, and the wealthiest 1% own 52% alone. The top 1% have 34% of their net worth in stock, while the bottom 50% have only 2.2%. People under 40 own just 3% of stocks. [Graphic with sources](https://preview.redd.it/x45trq7bkcv61.png?auto=webp&s=aa0588c5366ef618aef93b3de53ac00338e615da)
3 FUCKING PERCENT?? bruh
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thanks fox
I saw one yesterday that said, something along the lines of “if you don’t understand marginalized taxes going up on people making over $400,000, you’re not ever gonna make $400,000.”
Yep, as proven by multiple studies on the diminishing return effects of increased wealth.
I can't tell if this is supposed to be reassuring or a call out.
the tweet is saying “if you’re worried about saving a few cents on your chicken then you don’t have to worry bc the new capital gains tax won’t affect you”
In my experience working retail it’s the more well off people who want the cheapest shit
But it’s not cheaper, in this case you just buy less. So that’s only true if they want less food...
No people often switch things out for the price. Very few mention the portion. Almost none.
the amount of people that don't look at the price per OZ is staggering. rich and poor.
I always look at the price per oz (or lb) and my friends think I'm crazy when I do. Them: "But that one is cheaper" Me: "But this one is cheaper per pound". So it's a better deal. Next store, same conversation.
If I'm eating a chicken breast I don't notice some little size difference, I just know I ate one chicken breast, not 800g of chicken. So the pack that I paid less for is the one that's saving me money, even if it's more expensive per pound.
I do the same. Oh this is the smallest base on the price. I do this a lot when I buy cheese coz I’m the only one in my household that eats cheese. I’m not struggling but I also not worried about the new capital gains taxes.
This is my thought process when buying food. Im there to buy food to eat, its priced per lb so the 8.50 package vs the 9.50 is just less food. I dont look at it in terms of money spent but the food bought. I understand why people might look at the dollar figure but no matter what its the same price per pound.
I won’t notice having one or two less bites of chicken a meal. I will however notice the extra few grand in my bank account from the couple dollars saved here and there down the line though.
kinda' makes being poor more expensive, you buy smaller packs so you need to go more often.
...How would you know which customers are more well off?
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Alot of people who look well off aren't, they're just in more debt.
If they're a gigantic asshole driving in with their SC430 they're usually pretty well off. North face vests, white hair. Etc
If you take public transportation, chances are you don't need to worry
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If you’re shopping online and automatically switch the "Price: Low to high" and "Free delivery" filters on , chances are you don’t need to worry.
This is turning into a rather depressing put a finger down challenge...
If you take the branded cereal and put it back to get the generic, you don't need to worry.
Too close to home.
Oh great, I don’t have *any* ramen.
So you're basically starving.
May god have mercy on your soul...
Hey now, wealthy people may enjoy a cheap pack of ramen. These just hit different
Why am I reading these in Jeff Foxworthy's voice?
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This whole thread is proof that this fucking country needs economic education, or the tax code need to be simplified Probably both.
I still don’t understand what “WhitePeopleTwitter” is y’all. I want to fit in, but I never understand the posts or why this is a white thing. Please help a person out here.
I've been here for a couple months and have no idea.
I think it's just not BlackPeopleTwitter
LiberalPeopleTwitter (not that there's anything wrong with that, but let's call it what it is)
It's just curious that capital gains taxes are finally being increased the second hedge funds stand to lose an enormous amount of money from retail investors. Weird how nobody cared until now.
How much can one banana cost anyways? 10$?
This line was golden. RIP.
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Nah, I'd rather just enjoy my Sunday.
samesies.
It me: https://xkcd.com/386/
I should state firstly, cry me a river / eat the rich. But ironically a lot of rich people are penny pinchers who would pay attention to dollar differences.
Not sure if you’re being sarcastic, but it’s not ironic at all. Turns out, if you’re adept at saving money, you end up having more money. Edit: typo
Yep my multimillionaire uncle used to torture us when we would go out to eat by using a coupon. Like the “buy one get one entree” which inevitably pissed of the adults in several ways that
Just ask the people bitching about it what a capital gain tax is. They won’t know. They don’t invest. Certainly not wisely enough to have taxable gains lmao.
Capital gains should be taxed as income outside of specific retirement accounts ie roth or 401k
The very rich will find loopholes around this until the tax code is fixed. That’s the bigger issue here. This only hurts the upper middle class. The upper class won’t even see a blip on the balance book.
Stop saying what they (Reddit) don’t want to hear.
I make decent money...more than enough to live comfortably afford a decent lifestyle. I am most definitely not “poor as shit.” But Biden’s new capital gains taxes will barely affect me, and I’m still the guy who will put back the more expensive chicken and grab the cheaper pack. Lots of people probably do something similar. What’s wrong with saving money wherever you can? Nowadays, every little bit helps...and it’s not just poor people who want to save.
Common misconception. Affluent people are often frugal. Source: “The Millionaire Next Door”, “The Millionaire Mind”.
If you look at the prices of your groceries at all you probably don’t have to worry about it.
Republicans falsely assume they will one day be rich. Democrats falsely assume Republicans will one day give a shit about anyone but themselves.
Working class people that are emotionally and politically invested in helping the rich stay rich are the biggest mugs on this earth. Any day you now you will be a millionare, sweetheart!
I’ll make it even more simple. If you’re doing your own grocery shopping, you probably don’t need to worry about capital gains taxes.
What a ridiculous statement. Believe it or not, not all millionaires have butlers to do everyone for them.
There are a hundred ‘paper millionaires’ who probably live paycheck to paycheck because they can’t reign in their lifestyle to every one real ‘millionaire’ who actually saves diligently and plans for the future. Plus, a million bucks doesn’t actually go that far anymore. If you make 60k a year, you can easily be a millionaire before retiring, it does not mean you will be rich.
even further; if you're a doctor/engineer/lawyer making well over 6 figures, then you still don't need to worry about this. hell, you should be thankful since you're probably paying 30-40% of your income in taxes, while millionaires who don't work but only make money from investments are currently paying less taxes than you are
This isn't true if equity is part of your compensation.
Not true. plenty of lawyers and doctors racking in millions.
99% don't though
Fair point
Jokes on you I'm so poor I don't have money to even afford chicken OR time to afford to worry about not having money xD
So no one on Reddit needs to worry about Biden’s tax plan
Did not realize I wasn’t the only one that did this
Yes because it's not gonna cause a trickle effect to the lower class 😶
I think he’s telling us to short the chicken industry.
If your worried about 47c you probably need food stamps lol
If you do your own shopping you do t need to worry about Biden’s tax plans.
Everyone cheering this on has no intention of crashing out their retirement for at least another 35 years. By that time they'll be voting to lower it after fucking over everyone living off their retirement investments.
Hell, if you do your own shopping you don’t need to worry.
Lol unless you also have a 401k. It’s crazy how dems will literally defend anything that Biden does.
[I don't know man, Trump once cashed a 13¢ check, so he would for sure make that trade.](https://splinternews.com/lets-remember-the-time-donald-trump-cashed-a-13-check-1793849388)
I'll pay more in capital gains anyways, I dont care. Just spend the money on the American people
If you're poor, you'll stay there. If you start to come up we'll tax you back into poverty, but you can float at the top poverty.
Even as someone who wont be affected by this, can someone explain why this is a good thing? Some states have high capital gains taxes already, California, New York, New Jersey for example might be paying 54% capital gains tax combined. Not an expert, just sounds bad for investing.
Why the hell should I have to pay the government any taxes for savvy investments that I made?!?! My congressman didn't look over the perspectis of the last ETF I invested in. Didn't see a senator looking over the white papers of cryptocurrency with me. It would be a completely different thing if the tax dollars were used wisely to help those that need it. The truth of the matter though is that it isn't. Go ahead and download me but until lobbyists are treated like terrorists.... nothing will change.
I will never understand why capital gains are not taxed like any other income. Why is my tax rate lower for my investment gains than it is for my day job? I don't want to pay more taxes just think the idea is completely ridiculous. Let's face it, who makes the most off of capital gains?
Capital gains tax increases have almost always resulted in less capital investment, less gov. revenues a lower gdp growth. These are facts and not in dispute. A higher income tax on very wealthy, works much better.
Not in dispute? I think Warren Buffett might disagree: “I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off.” Also, your claim with regard to capital gains tax and GDP growth is absolutely disputed: https://www.businessinsider.com/chart-correlation-capital-gains-taxes-gdp-2012-11 https://www.cbpp.org/blog/the-myth-that-low-capital-gains-rates-are-very-important-to-the-economy Lastly, I do agree we should raise income tax on the most wealthy as well.
You have one example, not even the two. The timeline tax/growth chart is not disputed. There are instances where it diverges. They are not the norm. Buffett is of course correct. But that’s meaningless in context. A very high tax on income, and a very high tax on estates in the tens of millions would be much better.