RE:RE:RE:New Capital Gains Taxes for Individuals
mugs19 wrote: "50 % was already obscene, 66% is downright MAFIA."
For clarification, Capital Gains are not taxible at a 50% tax rate. It means that 50% of the capital gains is taxable at whatever tax rate you fall under. Example if you have 10,000.00 in capital gains, 5,000.00 is taxable.
The new category will be: If you have $250,000.00 in capital gains, 66% will be taxable ($165,000.00) at whatever the tax bracket you fall into. I'm not sure if any changes have been made to capital gains less than the 250,000.00. I think this is a new category created...
mugs
They did not propose changes to any of the "tax rates", only to amount of capital gain that is subject to tax.
Before their change, 50% of a capital gain of $250,000 or more was subject to tax. After the change, 66% of a capital gain of $250,000 or more is subject to tax.
The "tax rate" at this level is currently 48%.
So on a million dollar capital gain;
Tax under the old scheme is $1,000,000 x 50% x $48% = $240,000.
Tax under the new scheme will be $1,000,000 x 66% x 48% = $316,800.
An additional $76,800 on just $1,000,000 of capital gains.
If the budget passes in the House, the new tax scheme becomes effective June 25 this year.
"The government can't give anything to anyone without first taking it from someone else." Unknown author.
jmo
glta
go ATH go