https://cryptonews.com/news/us-prop...ecome-penalty-for-being-successful-crypto.htm This is total BS...do we get to write off unrealized losses?
"Under the plan, the Treasury’s proposal is to be effective for taxable years beginning after December 31, 2022" The article says it was updated last summer but doesn't tell when it was first written. Is it safe to say that it doesn't apply to 2023? Has it actually passed?
I just looked it up. The proposed law would only apply to people with a net worth over 100M. It would be a very stupid law but I’m safe. Thank god. https://taxfoundation.org/blog/biden-billionaire-tax-unrealized-capital-gains/
Yes, this is about taxing the rich. Ultra high net worth people, especially those with "old money," or inherited wealth, don't work very much. Their wealth increases exponentially every year, with much of the increase arising out of the appreciation of stock and other assets that they own. As long as the don't sell those assets, they don't pay tax on their "income," and many people think this is unfair. I am not voicing my own opinion here. But the ultra wealthy, and their lawyers and accountants, have gotten very creative at finding ways to access that kind of wealth without selling the assets, and without triggering tax on the gain. It often involves borrowing against the assets, with loans that may not get paid off until after the borrower dies... and then the asset gets a stepped-up basis when it passes to the heirs.
"Infinite Banking" is a sales pitch for life insurance. The concept is that when you borrow against a whole life insurance policy, you become your own lender. There's a little bit more to it LOL But it's not just for the ultra wealthy https://www.nerdwallet.com/article/insurance/infinite-banking
The idea that the maybe the ultra-rich should be taxed on the increase in their wealth, even if much of it is derived from an increase in the value of assets that have not been sold, is not new. It has been kicked around in academia and think tanks for a long time. In 2021, ProPublica published a report about how the rich avoid taxes, and this has generated more chatter about finding new ways to tax the ultra-rich. See the attachment. As a tax professional, I find their arguments to be rather warped and naive. Maybe it's a good idea to change our tax system to tax the ultra-rich on unrealized capital gain. But the way the make their case is rather deceptive and manipulative.
Yeah, I know a guy whose business is to reach out to individuals with life insurance they cannot cash in (too early) but need money (generally health Issues). The business buys back the policy and pay the individual less their cut. They're always looking for investors to finance the policy purchases and offer guaranteed returns. Apparently that's only legal in the US.