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Politics : Formerly About Advanced Micro Devices
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To: steve harris who wrote (103054)4/8/2000 10:06:00 AM
From: Bill Jackson  Read Replies (1) of 1575761
 
Steve, If you are in a loss position and sell before your year end to freeze the loss, you then must wait for a time before you buy back the same shares....30 days, I think, but I have never done that so I am not sure.
As far as I know if you sell it you make a profit and right now 66% of that profit is taxed as ordinary income.
So an incremental $1000 on which I pay aboot 54% as ordinary income or $540 taxes is turned into a $660 gain on which I pay 54% or $$356 for an effective capital gains tax of 35.6%. We also have what is called 'flow through' share purchases, where you buy common stock in a provincial public company and you are allowed to deduct the purchase price from your taxes in stages over three years. Once you have deducted the full price then any proceeds have a zero cost base and are taxable with the 66% rule, but that income is deferred. Used by a lot of retiring people in high brackets(all Canadians) who defer taxes on earned income in high pay years into capital ganis after retirement at the 66% rate staged over years. I suspect there are similar schemes in the USA for high bracket people. The problem here in Canada is the too much government and too many civil serpents all employed for life at high union scales for minimal work...I could go on, but boring.....come the revolution.

Bill
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