Signs of the Times - and a question

[whell]

Originally Posted by d-ray657

A couple of things. If we tax capital gains as any other income, those retirees would probably be paying a rate lower than the current capital gains rate.

Depends on their tax bracket of course. But a married couple filing jointly pays 15% in regular federal income tax between roughly $18000 and $70000 in income. At $71K and above that couple would pay 25%. The rates would be roughly the same for short term capital gains taxes, but 10% or 20% respectively for long term gains.

Originally Posted by d-ray657

Second, the example you have been giving of vacant buildings and for lease signs - if you are talking about economically depressed areas where there is a need for a subsidy to attract investment - I think we have been in agreement that a subsidy is probably warranted. That does not, however, justify an across the board tax cut for the purpose for the purpose of stimulating investment where there is considerable evidence that such investment is not taking place despite significant cash reserves.

Regards,

D-Ray

OK. I guess this is where the rubber hits the road. Where evidence are you using to draw your conclusions? Are you looking back at the reports from a year or two ago about businesses not investing cash? With the pending increase in capital gains taxes that will occur in 2013, what is the incentive to invest if the value of that investment will be diminished by future tax law?

The more I speak to business owners - and these are small and medium sized businesses - they are very risk averse right now. Between the changes in health care law and the impending changes in tax law, they are very much playing a "wait and see" game right now.

Between the mushrooming "for sale / for lease" signs, and the feedback that I hear and see frequently, it would seem that these folks would be encouraged by a more favorable / predictable business climate.