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To: rairden who wrote (18497)	5/18/1999 8:57:00 PM
From: sea_biscuit	Read Replies (1) \| Respond to of 25814

Never let the tax tail wag the investment dog! A few lines from "It's WHEN You SELL That Counts", by Don Cassidy, are of relevance here [emphasis mine]: ----EXCERPT---- Granted that no one likes to pay taxes; but paying taxes on capital gains and on such taxable investment income as dividends and interest is a reality for all investors. It is not a surprise. Nor is it an unfair mid-game change of rules. Therefore, it is illogical to balk at selling a stock at a gain just because the transaction triggers a tax liability. There are only three logical extensions of refusing to take a gain on a stock to avoid paying income taxes. The investor must have bought the stock in the hope : 1. Of losing money (federal taxes are reduced 28 cents for every dollar lost) 2. That the stock's price would not change. 3. That the stock would be held for the remainder of the buyer's life. The first two alternatives are nonsensical and deserve no further comment. Despite tax reform, the third reason is a clever tax dodge because a legatee's basis is stepped up to the value on the date of the decedent's death. So an investor can "enjoy" the big loophole only by dying with capital gains unrealized. What a clever way to finally beat Washington! The objection to paying income taxes due on realizing a gain is just another rationalization for not making a sale decision; it is especially appealing to the rationalizer because it is conveniently external to self. It can be blamed on "them"; on the government, or on the "system"... ----END EXCERPT----