Capital Gains Tax Scam

[Travlyr]

The Capital Gains Tax is just another scam by our tax and cheat overlords. Here is how it seems like it works. Establish a value for capital. Example: Land. The base is determined by the purchase price. One hundred acres of land purchased in 1970 for $1000/acre = Cost Basis of $100,000. Sell in 2012 for $10,000/acre because the Fed inflated the dollar 10X = Sale price of $1,000,000. Capital gain of $900,000 taxed at 15% for a tax of $135,000. It is still 100 acres of land. That did not change. The value of the land did not change because the Fed inflated the money supply. Yet the tax and cheat fellows get their take. It is a double win for them. Inflate the money supply and then tax the inflation. Wow.

Allodial Title To Land For The Win!

 

[cubical]

absolutely. I wish Paul would say this during one of the debates. It is simple and it shows how corrupt our system is.

 

[Arklatex]

I'm going to borrow that.

 

[donnay]

The Capital Gains Tax is just another scam by our tax and cheat overlords. Here is how it seems like it works. Establish a value for capital. Example: Land. The base is determined by the purchase price. One hundred acres of land purchased in 1970 for $1000/acre = Cost Basis of $100,000. Sell in 2012 for $10,000/acre because the Fed inflated the dollar 10X = Sale price of $1,000,000. Capital gain of $900,000 taxed at 15% for a tax of $135,000. It is still 100 acres of land. That did not change. The value of the land did not change because the Fed inflated the money supply. Yet the tax and cheat fellows get their take. It is a double win for them. Inflate the money supply and then tax the inflation. Wow.

Allodial Title To Land For The Win!

Absolutely! +rep

 

[Travlyr]

absolutely. I wish Paul would say this during one of the debates. It is simple and it shows how corrupt our system is.

It is totally corrupt. High finance is nothing more than Money for Nothin' and your Chicks for Free

 

[Roy L]

The Capital Gains Tax is just another scam by our tax and cheat overlords. Here is how it seems like it works. Establish a value for capital. Example: Land. The base is determined by the purchase price. One hundred acres of land purchased in 1970 for $1000/acre = Cost Basis of $100,000. Sell in 2012 for $10,000/acre because the Fed inflated the dollar 10X = Sale price of $1,000,000. Capital gain of $900,000 taxed at 15% for a tax of $135,000. It is still 100 acres of land. That did not change. The value of the land did not change because the Fed inflated the money supply. Yet the tax and cheat fellows get their take. It is a double win for them. Inflate the money supply and then tax the inflation. Wow.

You might have a good argument if you had used some example other than land. Aggregate land value slightly outpaces GDP growth, which is inflation PLUS population growth PLUS increase in real standard of living. Moreover, individual land parcels most often yield large capital gains as a result of zoning changes, which are entirely from government, and vastly exceed inflation. I don't happen to support capital gains taxation even if the cost base were indexed to inflation (which it certainly should be), because it reduces market liquidity. The Japanese example is instructive: in the 1980s they increased the capital gains tax rate on real estate to put a brake on their land bubble (so they said). The result was that landowners hoarded their land, opting for low-taxed rent income over high-taxed capital gain income, market inventory dried up, and prices soared higher than ever.

The other reason your argument fails is that it is not government that increases the money supply. It is private banks. You just do not know any monetary economics.

Allodial Title To Land For The Win!

Allodial land title is perhaps the most evil and destructive concept ever devised by the human mind.

 

[donnay]

You might have a good argument if you had used some example other than land. Aggregate land value slightly outpaces GDP growth, which is inflation PLUS population growth PLUS increase in real standard of living. Moreover, individual land parcels most often yield large capital gains as a result of zoning changes, which are entirely from government, and vastly exceed inflation. I don't happen to support capital gains taxation even if the cost base were indexed to inflation (which it certainly should be), because it reduces market liquidity. The Japanese example is instructive: in the 1980s they increased the capital gains tax rate on real estate to put a brake on their land bubble (so they said). The result was that landowners hoarded their land, opting for low-taxed rent income over high-taxed capital gain income, market inventory dried up, and prices soared higher than ever.

The other reason your argument fails is that it is not government that increases the money supply. It is private banks. You just do not know any monetary economics.

Allodial land title is perhaps the most evil and destructive concept ever devised by the human mind.

Without allodial titles you are nothing more than a glorified renter.

 

[Travlyr]

Allodial land title is perhaps the most evil and destructive concept ever devised by the human mind.

That's weird. Moreso than a nuclear bomb?

 

[HOLLYWOOD]

(The health care law contains a new 3.8% tax on "unearned income" for taxpayers. Unearned income includes capital gains.) To be hit by the 3.8 percent capital gains tax, you first have adjusted gross income of $200,000+ if you are single. The capital gain is on the sale that exceeds the first $250,000 if this is a primary home(for singles).

So tack on another 3.8% for that $~750K portion

 

[Travlyr]

Without allodial titles you are nothing more than a glorified renter.

QFT! Either own your place like a King owns a kingdom, or pay the rent to the King who does own it.

 

[onlyrp]

If you don't like or don't believe your land appreciated, don't own it.

 

[onlyrp]

QFT! Either own your place like a King owns a kingdom, or pay the rent to the King who does own it.

or move to a country where land is free and pay neither.

 

[The Northbreather]

Whats the deal with the three year period that one must wait to sell a home less they incur the capital gains tax?

The way I understand it is that if you build or buy a house or purchase land and then sell it for a profit you will be taxed if you do so in less than three years.

 

[angelatc]

Whats the deal with the three year period that one must wait to sell a home less they incur the capital gains tax?

The way I understand it is that if you build or buy a house or purchase land and then sell it for a profit you will be taxed if you do so in less than three years.

Its designed to differentiate investment sales from homeowners who sell their primary residences. Very generally speaking, buying and selling a home for a profit incurs the capital gains tax, while buying and selling a home that you bought to live gets exempted.

As far as I know, undeveloped land doesn't get the exemption.

 

[The Northbreather]

Its designed to differentiate investment sales from homeowners who sell their primary residences. Very generally speaking, buying and selling a home for a profit incurs the capital gains tax, while buying and selling a home that you bought to live gets exempted.

As far as I know, undeveloped land doesn't get the exemption.

But why does it exist, especially with building and selling a home? It seems to me that you can build and sell a home for a profit relativity easily. Is it because the profit is considered income?

 

[angelatc]

But why does it exist, especially with building and selling a home? It seems to me that you can build and sell a home for a profit relativity easily. Is it because the profit is considered income?

No. According to the IRS income is money you make at a job. Capital gain is money you make from investing. If you buy land and build a house and sell it without ever living in it, you likely did it as an investment.

I have a feeling that this is turning into a philosophical question, and I want to warn you I have no interest in exploring the angst that goes along with the "all taxation is theft" position. I agree to an extent, but it's also a reality.

Therefore, in answer to your question, "But WHY does it exist?" I submit only that it exists because Congress decided that people who bought their houses to live in should get exempted from paying capital gains taxes on the appreciation, while people who made money speculating on land values for investment purposes would pay a tax.

 

[Roy L]

That's weird. Moreso than a nuclear bomb?

Certainly. Irresponsible landowning -- "allodial" means unconditional -- inherently inflicts evil on people. It violates innocent people's rights, and kills many millions of them every year. A nuclear bomb is merely a tool that can be (and has been) a deterrent to killing.

 

[Roy L]

Without allodial titles you are nothing more than a glorified renter.

Thank you for expressing your view clearly: you evidently consider those who do not own land -- "renters" -- to be less than human, without rights or any claim to dignity or respect. Why else would you consider it such a horrible fate to be a "glorified renter"?

With allodial titles, you are nothing more than a glorified thief:

THE BANDIT

Suppose there is a bandit who lurks in the mountain pass between two countries. He robs the merchant caravans as they pass through, but is careful to take only as much as the merchants can afford to lose, so that they will keep using the pass and he will keep getting the loot.

A thief, right?

Now, suppose he has a license to charge tolls of those who use the pass, a license issued by the government of one of the countries — or even both of them. The tolls are by coincidence equal to what he formerly took by force. How has the nature of his enterprise changed, simply through being made legal? He is still just a thief. He is still just demanding payment and not contributing anything in return. How can the mere existence of that piece of paper entitling him to rob the caravans alter the fact that what he is doing is in fact robbing them?

But now suppose instead of a license to steal, he has a land title to the pass. He now charges the caravans the exact same amount in “rent” for using the pass, and has become quite a respectable gentleman. But how has the nature of his business really changed? It’s all legal now, but he is still just taking money from those who use what nature provided for free, and contributing nothing whatever in return, just as he did when he was a lowly bandit. How is he any different now that he is a landowner?

And come to that, how is any other landowner, charging rent for what nature provided for free, any different?

 

[Roy L]

QFT! Either own your place like a King owns a kingdom, or pay the rent to the King who does own it.

You seek to exercise unjust privilege to violate the rights of your fellow men without making just compensation; and as excuse, you claim the only alternative to being a thief is being a victim.

 

[AnythingButPaper]

I tell you, If governments are good at one thing it is coming up with innovative taxing schemes.