Discussion about this post

User's avatar
J. Austin Campbell's avatar

I'm not sure Julie's objection to the tax basis step-up issue is correct. It's conflating two separate problems: how much you owe in taxes, and when you owe them. If you had a property that was purchased for $25k, when the owner died and passed it a descendant it was worth $500k, and then five years later the descendant sells it for $550k, the descendant will pay taxes on $50k of gains. The $475k vanishes into the abyss of the tax basis step up. A separate question is when the taxes are paid. A proposal that says only the person inheriting the property I referenced above would owe taxes on $525k of gains if they sell (sale price - original purchase price) should not implicate the ability of someone to inherit property even that has massively increased in value, as there's no immediate tax bill (only on sale). On the other hand, a modification to the code that also makes taxes immediately payable on sale would create that problem, but to my current understanding (having not seen exact text of the bill), the Democrats are currently proposing the former, not the latter. So to that end, I'm not sure what Julie's objection is: you wouldn't pay taxes unless you sell, so unless the plan was to sell anyways, this is unchanged from the current treatment. It just means when you eventually sell, you are taxed in full on the gains from time of purchase, regardless of who purchased or when it occurred.

Expand full comment
Sherri Priestman's avatar

I don’t normally pay much attention to military matters or leaders, but today’s newsletter prompted me to read James Fallows on the same topic. It was interesting for more insight into the Chinese perspective.

https://fallows.substack.com/p/the-importance-of-the-milley-call/comments

Expand full comment
5 more comments...

No posts