this post was submitted on 14 Jun 2024
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[โ€“] Burstar@lemmy.dbzer0.com 16 points 6 months ago (3 children)

First, the bump to 66% only happens after 250k that year so $25k would not trigger the extra 16% eligibility. So standard 50% CG only would be applied. $12.5k taxed at your rate means the min rate which may be something like 20% (this number is a wild guess) so say $2500 paid to the gov. Not as bad as it sounds.

[โ€“] ryper@lemmy.ca 9 points 6 months ago (1 children)

Don't forget that the $25k wouldn't all be gains in the first place. If the investment had increased in value by 25%, it would be 20k base and only 5k gains; if it had increased by 100% it would be an even split. We're talking about taxing a part of a part of the sale value.

[โ€“] MacroCyclo@lemmy.ca 5 points 6 months ago

Once you get this far down the thread you realize how complicated it actually is and why most people have no sweet clue how it works.

[โ€“] Bye@lemmy.world 7 points 6 months ago (1 children)

Thanks for the info, that makes perfect sense. Seems like a good idea to tax people making tons and tons of money at a high rate then!

[โ€“] Burstar@lemmy.dbzer0.com 3 points 6 months ago

IF it was forced to be in the 66% CG bracket $16.5k would be taxed at the previously posited 20% resulting in $3300 paid to government so it is a respectable jump in tax owed for those being subjected to it.

[โ€“] Burstar@lemmy.dbzer0.com 5 points 6 months ago

A better way to think of it is <$250k 50% of the profit is tax-free. >$250k only 34% of it is tax exempt.