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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (24690)	9/19/2012 2:34:10 PM
From: TimF	Respond to of 42652

If you get compensated by a delayed share in the profits rather then upfront cash, that's equivalent to getting a smaller amount of upfront cash (ordinary income), and then investing it and getting a return (capital gain). ... Capital gains are often on income that's already been taxed. Also they are on gains that are not really gains but just inflation, so taxing it at the "same rate" is really anything but, in fact you can have an infinite rate on capital gains (no actual gain, some actual tax, its either infinite or its a divide by zero error). Beyond that high rates on investment income is economically harmful, the only way to avoid the harm and have every rate be the same is to cut ordinary income rates. I'd be fine with that, but then we would have to cut spending (which I'd also be fine with but many would not). Message 28004624

To: TimF who wrote (24690)	9/19/2012 2:34:52 PM
From: John Koligman	Read Replies (1) \| Respond to of 42652

This paragraph from your first link sums it up nicely for me... "Critics of current law think it is unfair that these private equity partners are taxed at capital gains rates, whereas other high-income individuals like doctors and lawyers pay the much higher tax rates for ordinary income. It is a reasonable point, and some reform may well be appropriate. But as the tax situations of Abe through Earl illustrate, it is not obvious what the best approach would be. Not all problems have easy answers."