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Politics : Formerly About Advanced Micro Devices
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To: combjelly who wrote (800240)8/7/2014 4:47:39 PM
From: i-node  Read Replies (2) of 1583493
 
Capital gains used to be taxed like any other income.

I don't know where you got this idea but you're FOS. In the US, capital gains have almost ALWAYS received favorable tax treatment. The only exception I can recall is that the Reagan TRA86 did away with the reduced capital gains rate, but only because overall tax rates were flattened. As everyone realized would happen, within a few years the ordinary income rates were back up where they started, sans capital gains rates. In the early 90s under Clinton, LTCG rates were reduced as they had to be.

You cannot sensibly tax LTCG at the higher rates of ordinary income. We know that. It just doesn't work.

People still invested in the stock market. Granted, not at quite the same rate as now. But that was mainly because it was difficult to buy stocks unless you bought a lot or knew a broker.

Taxes never entered the equation.

As one who has dealt with this issue professionally, I again say you're FOS. Certainly, one of the most frequent phone calls a CPA gets from clients concerns qualifying for capital gains treatment on sales of property -- whether it is stock, farmland, business property, or a personal residence - people are always extremely concerned about taxes. For most people two-earner couples taxes are their single biggest financial concern. If you think people don't think about it, you ought to hang out at your CPAs office the last couple weeks of any tax year.
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