Skip to comments.Question? Nobama just said it again...
Posted on 10/28/2008 7:23:20 AM PDT by NedRocker
I am either dumb of he is. Can someone please explain what the "capital gains tax" on small business is all about.
Thanks in advance
ALL YOU CAPITAL GAINS IS BELONG TO US!................
he has NO clue what he is talking about because his wealth is generated through graft and government salaries.
Capitol gains amount to confiscation of work, sweat and blood. Unless like a Kennedy you inherit your wealth.
I’m not sure, either. Unless profits are counted as capital gains, I don’t know if small businesses pay any capital gains taxes. I’ve been wondering if it’s all smoke and mirrors again.
One day a doctor will tell him he’s got an IQ of 40. Also known as Mentally Retarded.
CAPITAL GAINS TAX: The taxable profit derived from the sale of a capital asset. The capital gain is the difference between the sale price and the basis of the property, after making appropriate adjustments for closing costs, fixing up expenses, capital improvements, allowable depreciation, etc.
You forgot affirmative action and quotas, both he and his wife did well on those too.
Small businesses generally don’t have to worry about capital gains. Normally the income of a small busioness is income derived fromoperations, not the appreciation of capital holdings.
I think Obama has his head in his Democrat ass.
Profit realized on non-inventory items purchased at lower price. Typical capital gains items are stocks, bonds, , Real Estate....
The the owner of the Dolphins he is selling before Obama and said he would rather give the extra tax Obama wants to Charity than Obama.
Profits can’t be capital gains unless you invest in something (office building, equipment?) and then sell it for a gain. Individuals could invest in stock in a small business presumably, and sell it for a gain but none of this rhetoric makes any sense....
Obama’s an idiot. Individuals have capital gains; corporations have profits. Of course, Demoncrats immediately modify the word “profits” with the word “windfall” if your company has the word “Oil” in it.
And that was always my assumption, is that capital gains are associated with the sale of property, specifically (if not exclusively) real estate. (I have a small business associated with the mortgage industry.)
IMHO, when he makes it a major talking point the “average” American think he’s doing something for every small business.
Invest in a building for $500K for your business, sell it for $2M ten years later when you decide to retire. $1.5M is capital gains and subject to that tax right off the top.
That should tell us all something. I'm looking to sell off my shares before Jan. if the ONE is elected! He'll get NO share of my stocks!
I heard him say that, too. These people want to raise the capital gains tax but do not what what a capital gain is, or how it is taxed. Nor can they distinguish between a profit and a capital gain. Colossal ignorance and arrogance combined. Oh, I forgot, this guy went to Harvard. Woe betide our country.
This is a smoke screen that he throws out to the bots to show how much he’s doing for small business. Most wouldn’t know a capital gain if it hit them in the patooty, and don’t know that you have to sell an asset to aquire a capital gain. So all of us small business people will have to sell our businesses to qualify for the capital gains cuts he says he’ll give us.
“Unless like a Kennedy you inherit your wealth.”
There’s a death tax for that.
Obama Hussein - You make it, we take it.
He doesn’t know what he’s talking about on any subject. I’ve never seen anyone pass through more high-priced education and have so little of it rub off on him. This is why he doesn’t speak much without a written script. He is plain ignorant.
Obama means that anytime you succeed in your small business and increase your profitability, the government will capitalize on your gain by taxing you more and more........../s
If your small business is a partnership, corporation, LLC, etc., then when you attempt to sell it, Uncle Sugar is going to hammer you, convict style.
He doesn’t know anything about capital gains — but I bet he knows EVERYTHING about affirmative action, quotas, disability payments, and welfare.
You know, he was a trainer for ACORN!!!!!!
Depends on the business. A lot of family businesses own the building where the business is conducted. In the case of retail stores, there is often a huge appreciation. If the business is liquidated, or just needs to sell the property to move to a new location better suited to current needs, the capital gains tax could also be huge. A couple of years ago, a family owned hardware store in my “upscale” hometown decided to close, after nearly 100 years in business, due to health problems of one of the owners, and lack of interest from the next generation in continuing the business. The building probably sold for close to a million dollars, due to the location, and had probably been bought for a few hundred. It’s doubtful they had a lot of documentation of major improvement expenditures either, since the building hadn’t undergone any major changes, and since most minor work (replacing windows, resurfacing the roof, etc) would have been done by family members in their spare time, during slow spots in the business day. The appreciation in the value of the building probably represented 10 years or more of net income.
So in reality the Cap gains tax is a tax on the sale of an asset not a product.That is just wonderful!!! He won’t tax you as much when you have to liquidate your small business. What a great REFORMER!!! /sarc
Hmmm.... lets take another look...
We were a retail store organized and taxed as S-corp.
The profit/loss from business was figured on one form, then it was put on our 1040 and we were taxed at the personal rate. There’s a reason that many may realize a TAX increase as a business owner. Now to the question - we bought the store using cash we had, loan from the PO, and SBA loan, and a 2nd mortgage on our home. The cost of that business was the starting point, or “basis”. Improvements we made, purchases of fixtures, shelving, equipment like computers, etc. were tracked. In the end, when we sold, we got MORE out of it than we paid. The increase of the value of the business, and that includes intangibles such as customer base, reputation, etc, is how we were taxes, capital gains. We “gained” bought for say 135,000 and sold for 200,000 and you consider the cost if things we put into it, say that was 20,000 so the basis was 135,000+20,000 for 155,000. Sell for 200,000 and the gain is 45,000. You would be taxed on that.
We also run a quilting business from home - if we bought a quilting machine, depreciated it for 3 years and after 3 years it was valued for tax purposes at 8,000, but sold it for 9,000, there’s a capital gain. SO, even TINY businesses DO have to worry about capital gains! You can have gains for many reasons, even stock investments, etc. are included.
We have various small investments and get dividends, and the increases in the value of the investments, you can pay capital gains taxes.
Buying and selling (flipping) a house, can get you a gain unless it’s a primary residence.
An increase in the capital gains tax will hurt businesses of ALL sorts and sizes, AND people who have retirement accounts in many cases. Watch for wall street to puke if that tax is raised!!
Not if you’re a Kennedy. They had Rose listed as living in Florida even though she hadn’t seen the north side of the Sagamore bridge in tewenty-five years. Caroliyn and John also got Jackie O’s estate taxed as income instead of the higher rate.
When they are forced to liquidate their assets due to his confiscatory income taxes, he can then hit them again for capital gains.
Actually, I suspect he knows it as well as anyone. His arrogance compells him to believe, as it does to all on the Left, that WE are too stupid to know the distinction. Recall his answer in response in the primary debates. He admitted to knowing raising capital gains taxes reduces revenues. However, he felt it important that the productive be punished [pejorative mine].
f=r.... pretty close on keyboard...now to the subject at hand. Your thoughts Mr Spellchecker.
Sure, at the liquidateion of a business there could be all kinds of capital gains. You could also have this issue if selling a long-held piece of real estate as part of a move.
But these are extraordinary situations, not normally part of ordinary day-to-day business.
That’s right up there with
“most of those capital gains are in 401k’s”
in response to the statement that 70+% of taxpayers reported capital gains on their income taxes.
(pssst, Barry - if it’s in a 401k/IRA, it doesn’t get reported on your income tax return)
I would surmise that it would be the difference of the original start up cost and the value when sold to another entity. Example the original Banana Republic’s start up cost measured against what the owners received when they sold it to Gap.
It’s not really all that relevant for most, because most assets depreciate fairly quickly (if depreciate is the proper word for that? ask accountant). For example, let’s say that you build a house that’s worth more than all of the costs of building it. If you sell it at a profit immediately, you’ll pay the capital gains tax (if I remember correctly). If you live in it long enough before selling it, you don’t have to pay the tax. ...lower capital gains tax per length of time spent using the property yourself.
...hope that helps.
...meant to say that it’s not very relevant for as many people now because of the deflationary trend regarding real property and the like.
Unless like a Kennedy you inherit your wealth and votes.
“ALL YOU CAPITAL GAINS IS BELONG TO US!................”
HAHAHAHAHAHAHAAAA..... shame on you :-D
In bad economic times, such moves are more likely to be necessary, and this type of scenario is far more typical of small and/or family-owned businesses than of other businesses.
somebody stole my smiley...........
Bingo. It is supposed to sound good to everyone else but few small businesses would meaningfully benefit. Hard to see how it would make it easier to hire staff.
Yep, smoke & mirrors. Oh, but don’t forget, he’s gonna give us a 3K tax break for creating new jobs! I’m waiting to see the small print on that one. Wonder how long we’d have to keep the employee to get the 3K.
And what entitlements will need to be granted to the employee? My contractor neighbor retired after 40 years and said towards the end, it was always better just to pay towards the high end of the scale and use temporary staff.
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