Re:A Cautionary Word on the Deferred Life Plan
by rprasad on Wednesday May 30, 2012 @05:00PM
(#4044819)
The parent's reference to taxation has no basis in reality; your understanding of taxation is correct.
You are only taxed on income. If you have money in the bank, and you receive more money, that new money gets taxed. If you own a company, and it increases in value from $1M to $2M over a year (but you don't sell it), you are not taxed, because you haven't received any actual income.
You are only taxed on income. If you have money in the bank, and you receive more money, that new money gets taxed. If you own a company, and it increases in value from $1M to $2M over a year (but you don't sell it), you are not taxed, because you haven't received any actual income.