Re:Taxation of Carried Interest
by colanderman on Sunday June 10, 2018 @03:06PM
(#17279670)
Since when do you pay taxes on capital losses?
[ Parent
| on HN ]
You don’t. But you lose the money. Risking $10 to make $10 is much different that risking $10 to make $0.10.
You are more willing to invest at 1:1 odds than you are 100:1. Especially since the odds actually don’t reflect the actual risk of the investment itself. 100:1 on a sure thing is better than 1:1 on something that is very high risk. However, no investment is a sure thing. There is a non-zero level of risk in any investment, so if the payoff doesn’t match the risk, you simply will put the money under your mattress.