When I wrote yesterday about the senator who won’t give up on taxation of unrealized gains, I gave him a little too much credit when I said that he apparently figured out that it wouldn’t work on some types of assets (he calls them "nontradeable" assets). No, he’s come up with a Rube Goldberg type contrivance to penalize you for deferring the realization of gains on your "nontradeable" assets. By deferring the gains, what he means is, you didn’t sell the assets. He’s going to fix that (you) by going back and treating the gain as if it was realized in each year that you held the asset, apparently. He still doesn’t really explain how this is going to work.
Here’s the senator’s description of this latest brilliant idea:
Tax due on gain realized from non-tradeable property such as real estate, business interests or collectibles will be calculated at sale or transfer through a lookback charge. The lookback charge would tax accrued gain and minimize the benefit of deferring tax. Senator ***** is evaluating several possible methods of calculating a lookback charge, including an interest charge on deferred tax, a yield-based tax to eliminate the benefits of deferral or a surtax based on an asset’s holding period.
No, I’m not going to link to it. if you really want to read the whole thing, it’s not hard to find.
The contents of this blog, this web site, and any writings by me that are linked here, are all my personal commentary. None of it is intended to be legal advice for your situation.