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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: J_F_Shepard who wrote (622831)	8/4/2011 2:15:28 PM
From: TimF	Respond to of 1584667

.and it is more than a small portion of their income otherwise they would fight so fiercely for it..... Its not tiny, but its likely small. Remember these are the people who structure the deal. They can restructure them if need be. You could get it all taxed at ordinary income rates by eliminating the distinction between ordinary income and capital gains. But if you tax investment at such high rates you get less of it, and more of its outside the US or in tax shelters. The harm would be far more than the gain, probably even if you only considering federal revenue, definitely if your considering the overall effects on the economy. So that would be foolish and we shouldn't do it, but if we don't then a good portion of the income for the hedge fund managers is likely to be capital gains, one way or another.