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re: “The rich avoid tax by taking loans against their stocks!”
Posted on 6/13/26 at 9:47 pm to Victor R Franko
Posted on 6/13/26 at 9:47 pm to Victor R Franko
Agree. Unfortunately a lot of these people listen to the wrong pundits who give very bad advice. Dave Ramey comes to mind.
I see people refusing to fund retirement accounts or match company contributions for really bad reasons. They could be better off but are hard headed and can't grasp the subject.
I see people refusing to fund retirement accounts or match company contributions for really bad reasons. They could be better off but are hard headed and can't grasp the subject.
1
Posted on 6/13/26 at 9:53 pm to Ag Zwin
quote:
And, by the way, the appreciated value of those stocks that collateralized the loan is fully taxable. Primary residence appreciation is not. So, if anything, common proles have proportionally more opportunity to avoid taxes than 12-Zero Elon.
They get the same 250/500 tax free brosef.
Posted on 6/13/26 at 9:54 pm to Ag Zwin
If you have a broadly diversified portfolio why don't you just match winners and losers in what you take out so you have no realized gains?
Posted on 6/13/26 at 9:55 pm to Jorts R Us
quote:
proportionally
Did I type that word too fast for you?
Posted on 6/13/26 at 9:59 pm to Ag Zwin
quote:
Did I type that word too fast for you?
No but the proportionality is meaningless here. They can access the same capital as any other American and then some. That's the point.
And ftr, I'm not bitching about the rich. Just found that to be a rather meaningless observation you made.
Posted on 6/14/26 at 5:26 am to Victor R Franko
quote:
This isn't legal unless they're waiting the required 30 day waiting period necessary to allow the loss offset. I'm sure that's what you meant.
It’s not what I meant, but it might be true.
Posted on 6/14/26 at 5:27 am to Ag Zwin
If you go read most of the "elon is a trillionaire" messages on X that are making the rounds, the number of people who think he has a checking account with $1T in it is astounding.
Posted on 6/14/26 at 5:32 am to holdem Tiger
quote:
new basis rule
Step up in basis upon death is not new. It’s only been around since the 1920s.
Posted on 6/14/26 at 6:03 am to theballguy
quote:
Same percentage as what I pay. At a minimum.
Percentage of what? Income? They are paying a higher percentage of income than the middle class are. Do you mean to reclassify capital gains as ordinary income?
America’s rich are taxed as heavily as the rich in Scandanvian countries. The reason they can afford expansive welfare systems is because they tax the affluent and the middle class more. This is an excerpt from a recent Matthew Yglesias substack…
quote:
If you compare the United States to the famously high-tax Nordic countries, the major difference is not in the top statutory income tax rates. The top American combined state and local tax rate is generally a little higher than it is in Norway and a little lower than in Denmark and Sweden. New York and California, where a large share of our billionaires live, have unusually high top income tax rates, so the richest people are paying Nordic-level marginal rates.
The big difference is that the Nordic top rates kick in at between 110 percent (Sweden) and 180 percent (Norway) of average income versus 880 percent of average income in the United States. Obviously if we lowered the threshold for the top income tax bracket down to the Norwegian level, that would generate a ton of extra revenue — including extra revenue from billionaires — and that could pay for all kinds of things.
But nobody in the United States wants to ask the middle class to pay more, so we keep seeing efforts to kind of redefine the billionaire situation to make it seem like they’re paying unusually low tax rates when they actually aren’t.
Posted on 6/14/26 at 6:09 am to dovehunter
quote:
Agree. Unfortunately a lot of these people listen to the wrong pundits who give very bad advice. Dave Ramey comes to mind.
I see people refusing to fund retirement accounts or match company contributions for really bad reasons. They could be better off but are hard headed and can't grasp the subject.
Disagree with your statement about Dave Ramsey. He's talking to people who are and will always be in financial troubles. I think he's simplifying things for those that are not disciplined and will never advance their financial education or knowledge. I liken it to the US government having to keep Social Security and not dissolve it. There are those in our society who will never save. No matter what, money flows through them and they never save or accumulate. They're financial children and personally I don't want to live in such a wealthy society that doesn't at least care the minimum for our financial fools. We just have to do it. The people you mention in your second statement are who I'm talking about. I'm also talking about real working people that have paid into the system, not fraud or illegal stuff.
You seem to be financially aware and disciplined, this doesn't apply to people like you. You're capable of determining your own financial future and self determined decisions.
Posted on 6/14/26 at 6:10 am to Ag Zwin
I just read something recently about a meeting between Biden’s CIA and Putin’s people that occurred three months before the invasion. The purpose of the meeting was to get the ground rules straight, between Russia and the US, on the Ukraine war. We were in on it.
Posted on 6/14/26 at 6:52 am to Swampcat
quote:
What is a HELOC/ LOC?
Home Equity Line of Credit.
Draws have to go to improving substantially the property securing the HELOC (or trace the interest to an investment property).
LOC just remove the HE.
This post was edited on 6/14/26 at 6:52 am
Posted on 6/14/26 at 6:59 am to Penrod
Getting the government to decide what is fair is a fatal mistake. Every time.
Posted on 6/14/26 at 7:16 am to Ag Zwin
Folks, anyone can do this! If you build up a healthy savings account, then you can take out a "share loan". You borrow money from your own account. In this case the rich take a credit line out and only pay interest on what they take each month against their stock. I assume the interest is quite low due to 100% colateral of stock. It's likely they pay the interest to themselves just like we would on a "share loan". You just have to have a healthy savings accout. Did this when I was a teenager many decades ago.
Posted on 6/14/26 at 7:21 am to Bestbank Tiger
quote:
Also dumb because they have to pay the loan at some point. However they come up with the money is going to be taxable.
So one loophole is whole life insurance. The money can grow tax free then you borrow against the insurance plan and your death benefit pays it off when any residual going to your beneficiaries.
Posted on 6/14/26 at 7:32 am to McLemore
quote:
Home Equity Line of Credit. Draws have to go to improving substantially the property securing the HELOC (or trace the interest to an investment property).
This isn’t true of my Heloc.
Posted on 6/14/26 at 7:33 am to theballguy
quote:
Anyone who has a portfolio worth more than $1B should definitely be taxed for this. I'd go as far as $5M but billionaires gotta start paying their fair share.
You want a wealth tax? Because that is basically what it is. If someone had to pay taxes on the worth of their stock portfolio they likely would have to sell stocks in order to pay taxes on them. That hurts buisness and the market. No thanks.
Maybe I'm wrong but I kinda doubt those who are worth Billions have that money sitting around in checking or savings accounts. They are likely invested in stocks, real estate, buisnesses etc.
This post was edited on 6/14/26 at 7:34 am
Posted on 6/14/26 at 7:39 am to Penrod
quote:
This is 1/2,000 of Elon’s shares. This is not taxing all of his unrealized gains, just the ones he needs to sell to support his lifestyle. It would not crash markets, or even cause a blip.
You are talking about one person, how many people would be charged a wealth tax, even if it was just on stock holdings? Because wealth in the market is not liquid it would have to be sold to pay taxes on it. Maybe Elon alone wouldn't make a blip but imagine thousands or tens of thousands of people having to sell stocks to pay the government.
Also I would imagine that majority of Elon's wealth isn't in the market. It is likely in his company that he is CEO of, property he owns, etc. Which is that much more difficult to liquidate.
Posted on 6/14/26 at 7:42 am to catholictigerfan
quote:
You are talking about one person, how many people would be charged a wealth tax, even if it was just on stock holdings?
I wasn’t talking about a wealth tax.
Posted on 6/14/26 at 7:44 am to catholictigerfan
quote:
Also I would imagine that majority of Elon's wealth isn't in the market
That was true last week, but the vast majority of Musk’s worth is now in public stocks.
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