Re:We are publishing the tax secrets of the .001%
by fairity on Tuesday June 08, 2021 @12:23PM
(#27437272)
Hm, is it possible to define a range for "crazy high interest"? As the debtor, I'd be willing to pay up to the difference in long-term and short-term capital gains (~15%). I guess where I'm going with this is: I don't understand why the average person ever pays short-term capital gains tax.
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Re:We are publishing the tax secrets of the .001%
by jedberg on Tuesday June 08, 2021 @12:32PM
(#27437404)
> I don't understand why the average person ever pays short-term capital gains tax.
Because the risk of holding the stock is more than the difference in short vs long term capital gains.
If the stock is worth $1000 in gains, I know I can sell it and lock in the gains today and pay my normal income rate. If I have to hold it for another 6 months, there is a huge risk that it drops more than the 5-10% difference in the tax rate for the average person.
Re:We are publishing the tax secrets of the .001%
by sokoloff on Tuesday June 08, 2021 @12:52PM
(#27437656)
I pay STCG on option contracts written and on (profitable) short sales (where the holding period is defined to be short-term).
Other positions have a defined thesis and, if that thesis gets invalidated, I close out the position sometimes at a gain. I do try to make most of my gains be LTCG, but trying too hard to optimize capital gains rates can lead to poorer investment decision-making/asset allocation.