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Taxing unrealized capital gains is like asking a company to pay taxes in advance on accounts receivable that may never get paid. Oh, you billed a million dollars? You owe $250,000, whether the vendor pays or not.
Let’s say a stock goes up massively in a year. A founder’s stake in the company rises $100M in value. He has to pay $25M in unrealized capital gains (25% currently proposed). The next year a global pandemic hits and he loses the gains, and more. He has never sold anything,…
US wants to tax unrealized gains eh Looks like everyone will be coming for our worthless jpegs after all 😂
Under President Biden's proposed 'unrealized gains tax,' individuals would be taxed on the increase in company value even if the gains are not realized. This tax would apply to both public and private companies, potentially discouraging public offerings and leading to increased privacy in ownership. Critics argue that taxing unrealized gains is akin to taxing companies on potential future revenue, creating financial burdens and uncertainties for stakeholders.