Treasure Secretary Mnuchin wants to change capital gains taxes. What are capital gains?
treasury secretary Steven mnuchin is weighing a change in the Wake capital gains or tact he wants to adjust the gain from the sale of a stock or a house or other assets for inflation so what the heck are capital gains hi I’m Adam USA Today let’s say you buy a stock hold it for more than a year and sell it for a profit the long-term capital gain is the difference between the purchase price and the selling price let’s say you invested $10,000 into stock 10 years ago a 100 bucks a share and you sold it today for 200 – are doubling your money the value of your stock is 20000 and that adds up to a profit of $10,000 under current tax rules it would pay a capital gains tax on the full $10,000 but under the treasury proposal the adjusted cost of your stock after inflation might be say 13000 since your cost went up your capital gains will go down so instead of being tax on $10,000 you’d be on the hook for 7000 games on this very rough estimate let’s assume you’re in the highest tax bracket for the capital gains tax is 20% under the old rules your tax it would be $2,000 but if the new rule goes into effect you’d only have it bill of about $1,400 critics including leading Democrat like New York Senator Chuck Schumer have Panda proposal they say it only benefits wealthy Americans and Analysis by the Wharton School at the University of Pennsylvania president alma mater found at the top 1% of income earners we received about 86% of this tax cut this is also shows you as tax revenues will fall by 100 billion over the next decade that is 100 billion that would need to be found elsewhere in the budget or increase the national debt so it’s a rule ever goes into effect and there’s no guarantee it will it will definitely favor the so-called 1% the Americans that have the most sizable investments in stocks real estate and other assets that rise in valueUSA Today’s Adam Shell explains what exactly capital gains are and why Treasury Secretary Mnuchin’s proposal to change them has a lot of people concerned.
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