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A comment on With corporate tax off table, U.S. Democrats turn to billionaires.

Re:With corporate tax off table, U.S. Democrats turn to bill... by jude- on Monday October 25, 2021 @12:26PM (#28989713)
The article says this will tax unrealized gains on assets held by "exceptionally wealthy individuals," but what does that mean? Do folks who have equity options at a startup get hit by this?
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Re:With corporate tax off table, U.S. Democrats turn to bill... by nrmitchi on Monday October 25, 2021 @12:31PM (#28989774)
According to the first paragraph of this article, it targets "the country's roughly 700 billionaires".

It seems pretty safe to say that regular individuals at the vast majority of start-ups would not be affected.

Really I think this question speaks to one of the core problems around taxation discussion of extreme-net-worth individuals; there is a huge difference between winning $20M in the start-up lottery, and being a literal billionaire.

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Re:With corporate tax off table, U.S. Democrats turn to bill... by morpheuskafka on Monday October 25, 2021 @12:30PM (#28989755)
Other articles are saying that the criteria for the tax to apply is $1 billion in assets, or three consecutive years of $100 million or more in income.

I didn't look into the exact wording of the tax, but it would presumably apply to equity options the same as any other option. However, it would only apply to those who met one of the two criteria.

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Re:With corporate tax off table, U.S. Democrats turn to bill... by rmk on Monday October 25, 2021 @12:37PM (#28989867)
This is a twist on a somewhat similar system used in the Netherlands, I think. Over there, you pay 4% (or something like that; some amount of gains are 'assumed') on the assets you are holding, such as stock, every year.

https://en.wikipedia.org/wiki/Taxation_in_the_Netherlands#Bo...

Here, the proposal is that if the asset is held and grows in value, then it will be taxed without it being sold (i.e., the unrealized gains will be taxed).

I very much doubt if this will pass without legal challenges, and it may not stand up to close scrutiny in court.

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Re:With corporate tax off table, U.S. Democrats turn to bill... by kevinventullo on Monday October 25, 2021 @12:45PM (#28989976)
That would be a wealth tax, which seems to be verboten in the US.
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Re:With corporate tax off table, U.S. Democrats turn to bill... by rmk on Monday October 25, 2021 @01:39PM (#28990749)
No, it's not a wealth tax. Wealth Tax is usually understood to be the tax imposed on wealth transfer, for example when a wealthy person dies and the estate passes on to his heirs. Wealth Tax is not verboten in the US, it's actually very much a fact (it's known as Estate Tax), and wealthy people spend considerable time and money dealing with it. The current wealth tax exemption limit is $11.7 Million (i.e., you don't pay a penny of estate tax if your estate is valued at this number or below). Estates larger than $11.7 million are subject to Estate Tax. And large gifts made during the lifetime of the person whose estate is taxed also bite into the exemption amount of $11.7 million.
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Re:With corporate tax off table, U.S. Democrats turn to bill... by kevinventullo on Monday October 25, 2021 @03:50PM (#28992273)
Wealth Tax is usually understood to be the tax imposed on wealth transfer, for example when a wealthy person dies and the estate passes on to his heirs

Agree to disagree. What you’ve described is an Estate Tax or Gift Tax, which are not the same thing as a Wealth Tax.

A Wealth Tax is usually defined as a tax on the net wealth a person holds; transfers are not necessary. This is how both Wikipedia and Investopedia define it.

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Re:With corporate tax off table, U.S. Democrats turn to bill... by rmk on Monday October 25, 2021 @08:50PM (#28995144)
In the USA, Estate Tax is synonymous with Wealth Tax, and it is the commonly-understood usage. There are very few countries that tax (financial) assets where no gain is realized (i.e., they are not sold or exchanged). The Netherlands (and a handful of other European countries) have the system of taxing unrealized gains, but this usage of 'Wealth Tax' is pretty much obsolete all over the world.
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Re:With corporate tax off table, U.S. Democrats turn to bill... by kevinventullo on Monday October 25, 2021 @11:02PM (#28995945)
In the USA, Estate Tax is synonymous with Wealth Tax, and it is the commonly-understood usage.

That is simply not true.

- Estate Taxes are about taxing the transfer of assets upon someone’s death.

- Wealth taxes are about taxing the overall net wealth someone has at a given point in time. Gains have little to do with it; there could be ten billion dollars in cash under your mattress and you would still be subject to a hypothetical wealth tax.

In case you are not convinced, here are an overwhelming number of links using this definition:

https://en.m.wikipedia.org/wiki/Wealth_tax

https://www.investopedia.com/terms/w/wealth-tax.asp

https://www.pgpf.org/blog/2021/03/what-is-a-wealth-tax-and-s...

https://taxfoundation.org/wealth-tax/

https://berniesanders.com/issues/tax-extreme-wealth/

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Re:With corporate tax off table, U.S. Democrats turn to bill... by thrill on Monday October 25, 2021 @01:18PM (#28990463)
Exceptionally wealthy is government speak for "not you ... yet".
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Re:With corporate tax off table, U.S. Democrats turn to bill... by notananthem on Monday October 25, 2021 @12:30PM (#28989758)
Are you one of the 700 top billionaires? If you have to ask this, it doesn't apply to you.
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Re:With corporate tax off table, U.S. Democrats turn to bill... by mrfusion on Monday October 25, 2021 @12:37PM (#28989863)
First they came for the billionaires…
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