• An Explainer: Unrealized Tax Gains (California's Wealth Tax)

    From BTR1701@3:633/10 to All on Mon Feb 16 23:55:35 2026
    Since Gen-Z almost universally doesn't seem to grasp this concept and why it's an abomination, here's an explainer of California's proposed wealth tax.

    You buy a Pok‚mon card for $50.

    Someone offers you $500 for it. You say no. You love that card. It makes your collection complete. You're keeping it.

    The government says: "Cool, but that card is worth $500 now. You owe us $100
    in taxes."

    YOU: "But... I didn't sell it."

    GOVERNMENT: "Don't care. Pay up."

    You don't have $100 lying around so you're forced to sell the card you love just to pay a tax on money you never received. Next month? The value of that card drops back to $50. That's all they will sell for on eBay. Your card is gone. Your money is gone. And the government shrugs.

    That's a wealth tax on unrealized gains. They don't pay you back the tax when the thing you had to sell to pay the tax is no longer worth what they said it was.

    Now picture this:

    Your mom calls you crying. She has to sell the house she raised you in. Not because she can't afford it. She's lived there 30 years. It's paid off. But some website says it's worth more now and the government says she owes $15,000 she doesn't have. So she sells your childhood home. The kitchen where she made you breakfast. The doorframe where she marked your height every birthday.

    Gone.

    To pay a tax on money that was never real.

    Now picture the opposite:

    Your dad put everything into his small business. For 20 years he built it from nothing. The government tells him his business is "valued" at $2 million on paper. He now owes a massive tax bill. He empties his savings. Sells his
    truck. Borrows money. But he manages to pay it.

    Next year the market crashes. His business is now only "valued" at $200,000.
    He lost everything to pay a tax on a made-up number that doesn't even exist anymore.

    Does the government give him his money back? No.

    Does the government give him his truck back? No.

    Does the government care? No.

    They're selling this idea as "taxing billionaires" but billionaires have
    armies of lawyers, offshore accounts, and trusts. And when all else fails,
    they have the flexibility to just leave the state and move somewhere else. They'll be fine and they won't be paying this tax even if it passes.

    You know who won't be fine? Your mom. Your dad. Your neighbor with a small business. The farmer down the road who's had the same land for four
    generations and now has to sell it because the government said dirt got expensive.

    They're not taxing wealth. They're taxing people for owning things. It's like getting a parking ticket for a car you might drive somewhere someday. They
    want you to own nothing and be happy. And they're doing it to fund the fraud, waste and abuse of the welfare state they created.

    The reptiles in Sacramento say we shouldn't care about this because (1) it's a one-time tax, and (2) it's only for people with a net worth of a billion dollars or more so it won't affect us. Well, when the federal income tax was passed in 1861, it was sold as a temporary tax to help fund the Civil War and only applied to millionaires. And now look where we are. As Reagan said, there's nothing more permanent than a temporary government program and taxes
    on the rich will inevitably turn into taxes on everyone.

    They have enough money already. More tax isn't needed. It's all a lie. But they're gaslighting people into believing it's a rich vs poor debate.

    I hope everyone understands what's at stake.



    --- PyGate Linux v1.5.11
    * Origin: Dragon's Lair, PyGate NNTP<>Fido Gate (3:633/10)
  • From shawn@3:633/10 to All on Mon Feb 16 21:20:22 2026
    On Mon, 16 Feb 2026 23:55:35 -0000 (UTC), BTR1701 <atropos@mac.com>
    wrote:

    Since Gen-Z almost universally doesn't seem to grasp this concept and why it's >an abomination, here's an explainer of California's proposed wealth tax.

    You buy a Pok‚mon card for $50.

    Someone offers you $500 for it. You say no. You love that card. It makes your >collection complete. You're keeping it.

    The government says: "Cool, but that card is worth $500 now. You owe us $100 >in taxes."

    YOU: "But... I didn't sell it."

    GOVERNMENT: "Don't care. Pay up."

    You don't have $100 lying around so you're forced to sell the card you love >just to pay a tax on money you never received. Next month? The value of that >card drops back to $50. That's all they will sell for on eBay. Your card is >gone. Your money is gone. And the government shrugs.

    That's a wealth tax on unrealized gains. They don't pay you back the tax when >the thing you had to sell to pay the tax is no longer worth what they said it >was.

    I'm torn on this issue because it only really matters with ultra rich.
    Consider someone like Musk. He is allowed to borrow hundreds of
    millions of dollars at extremely low rates by setting some of stock as collateral. So he never has to sell his stock and thus never pays any
    tax. It's something that you and I can't do.

    That doesn't include the tricks that the wealthy can play with giving
    away their wealth before they day. Apparently the law is such now that
    Musk can given his wealth to his daughter tax free. I can't remember
    what the mechanism was but it would allow him to give her all of his
    stock tax free upon his death. At which time she could use the same
    tricks to live a very nice life without ever having to pay taxes.

    So while I don't like the idea of a wealth tax I also don't like the
    system we have in place now that allows the wealthy to avoid all
    taxes.
    Now picture this:

    Your mom calls you crying. She has to sell the house she raised you in. Not >because she can't afford it. She's lived there 30 years. It's paid off. But >some website says it's worth more now and the government says she owes $15,000 >she doesn't have. So she sells your childhood home. The kitchen where she made >you breakfast. The doorframe where she marked your height every birthday.

    Gone.

    To pay a tax on money that was never real.

    Now picture the opposite:

    Your dad put everything into his small business. For 20 years he built it from >nothing. The government tells him his business is "valued" at $2 million on >paper. He now owes a massive tax bill. He empties his savings. Sells his >truck. Borrows money. But he manages to pay it.

    Next year the market crashes. His business is now only "valued" at $200,000. >He lost everything to pay a tax on a made-up number that doesn't even exist >anymore.

    Does the government give him his money back? No.

    Does the government give him his truck back? No.

    Does the government care? No.

    They're selling this idea as "taxing billionaires" but billionaires have >armies of lawyers, offshore accounts, and trusts. And when all else fails, >they have the flexibility to just leave the state and move somewhere else. >They'll be fine and they won't be paying this tax even if it passes.

    You know who won't be fine? Your mom. Your dad. Your neighbor with a small >business. The farmer down the road who's had the same land for four >generations and now has to sell it because the government said dirt got >expensive.

    They're not taxing wealth. They're taxing people for owning things. It's like >getting a parking ticket for a car you might drive somewhere someday. They >want you to own nothing and be happy. And they're doing it to fund the fraud, >waste and abuse of the welfare state they created.

    The reptiles in Sacramento say we shouldn't care about this because (1) it's a >one-time tax, and (2) it's only for people with a net worth of a billion >dollars or more so it won't affect us. Well, when the federal income tax was >passed in 1861, it was sold as a temporary tax to help fund the Civil War and >only applied to millionaires. And now look where we are. As Reagan said, >there's nothing more permanent than a temporary government program and taxes >on the rich will inevitably turn into taxes on everyone.

    They have enough money already. More tax isn't needed. It's all a lie. But >they're gaslighting people into believing it's a rich vs poor debate.

    I hope everyone understands what's at stake.


    --- PyGate Linux v1.5.11
    * Origin: Dragon's Lair, PyGate NNTP<>Fido Gate (3:633/10)
  • From Adam H. Kerman@3:633/10 to All on Tue Feb 17 02:31:15 2026
    BTR1701 <atropos@mac.com> wrote:

    Since Gen-Z almost universally doesn't seem to grasp this concept and why it's >an abomination, here's an explainer of California's proposed wealth tax.

    I've ranted about this stuff on Usenet for decades. You've ignored it
    all.

    Wealth, in the form of personal property, is consumed, depreciates, deteriorates, or is depleted. You came up with the unusual example of
    a collectible or an antiquity or a work of art, whose value increased
    despite entropy.

    Wealth is the product of man, not nature. It fulfills human needs and
    desires.

    You earn wages from your own labor. You save a portion for your future consumption and you spend a portion for immediate consumption. You
    purchase goods, which are wealth.

    Some wealth is capital, that is, wealth in the production of other
    wealth. Examples are a factory, tools, and equipment. Inventory is
    capital until it's sold, when it becomes the wealth of its purchaser.

    Why the hell should any of this be taxed? The wealth you consume, the
    wealth you possess, all came from your own work. Even though it's
    morally wrong, govenment taxes your wages from labor, your purchase of
    wealth, also from wages, and when you consume or merely possess wealth.

    In your second example, the elderly woman's home has not become more
    valuable. It's needed maintenance, replacement, and rebuiiding.

    The land became more valuable because of society, having neighbors who
    have higher incomes or who built larger homes, and the quality of transportation and other infrastructure. You can make the bulding more
    valuable by expanding it or re-equipping for a specific purpose, but
    your actions don't make your own land more valuable.

    The building, the home, the factory, is wealth and should be treated
    like personal property and not taxed. It's the product of man.

    Taxing land is not immoral because its value was created by society.

    If the elderly woman is out of cash to pay property taxes, my state and
    plenty of other states allow the taxes to be deferred till the property
    is sold. There is a state fund that receives the tax bill, paying it
    when due, and charges interest. There is a lien. She's not forced to
    move.

    Moral dilemna solved.

    . . .

    --- PyGate Linux v1.5.11
    * Origin: Dragon's Lair, PyGate NNTP<>Fido Gate (3:633/10)
  • From The Horny Goat@3:633/10 to All on Mon Feb 23 22:34:45 2026
    On Mon, 16 Feb 2026 23:55:35 -0000 (UTC), BTR1701 <atropos@mac.com>
    wrote:

    The reptiles in Sacramento say we shouldn't care about this because (1) it's a >one-time tax, and (2) it's only for people with a net worth of a billion >dollars or more so it won't affect us. Well, when the federal income tax was >passed in 1861, it was sold as a temporary tax to help fund the Civil War and >only applied to millionaires. And now look where we are. As Reagan said, >there's nothing more permanent than a temporary government program and taxes >on the rich will inevitably turn into taxes on everyone.

    They have enough money already. More tax isn't needed. It's all a lie. But >they're gaslighting people into believing it's a rich vs poor debate.

    I hope everyone understands what's at stake.

    If you wrote that from scratch that was a brilliant posting.

    --- PyGate Linux v1.5.12
    * Origin: Dragon's Lair, PyGate NNTP<>Fido Gate (3:633/10)
  • From The Horny Goat@3:633/10 to All on Mon Feb 23 22:42:21 2026
    On Tue, 17 Feb 2026 02:31:15 -0000 (UTC), "Adam H. Kerman"
    <ahk@chinet.com> wrote:

    If the elderly woman is out of cash to pay property taxes, my state and >plenty of other states allow the taxes to be deferred till the property
    is sold. There is a state fund that receives the tax bill, paying it
    when due, and charges interest. There is a lien. She's not forced to
    move.

    British Columbia has had such a tax deferral system aimed at those 55+
    for years - I've only opted to do so 4 years ago and our provincial
    government (who administers the program) decided to move the interest
    rate on the loan from prime - 2% to prime + 2% causing a lot of people including me to check out paying it off.

    At least we're not having to pay property tax based on the assessed
    value now that I'm retired - the house I bought 30 years ago at $258k
    is now assessed at $ 1.85M which means I won't have to pay as long as
    I hold the house though my kids will have a huge tax bill when they
    eventually inherit it. (Though the deferred tax will have to be paid
    before they sell it)

    --- PyGate Linux v1.5.12
    * Origin: Dragon's Lair, PyGate NNTP<>Fido Gate (3:633/10)
  • From Adam H. Kerman@3:633/10 to All on Tue Feb 24 08:32:30 2026
    The Horny Goat <lcraver@home.ca> wrote:
    Tue, 17 Feb 2026 02:31:15 -0000 (UTC), Adam H. Kerman <ahk@chinet.com>:

    If the elderly woman is out of cash to pay property taxes, my state and >>plenty of other states allow the taxes to be deferred till the property
    is sold. There is a state fund that receives the tax bill, paying it
    when due, and charges interest. There is a lien. She's not forced to
    move.

    British Columbia has had such a tax deferral system aimed at those 55+
    for years - I've only opted to do so 4 years ago and our provincial >government (who administers the program) decided to move the interest
    rate on the loan from prime - 2% to prime + 2% causing a lot of people >including me to check out paying it off.

    Not only is it a secure loan, the government lien is probably superior
    to the mortgage. That interest rate is absurdly high.

    At least we're not having to pay property tax based on the assessed
    value now that I'm retired - the house I bought 30 years ago at $258k
    is now assessed at $ 1.85M which means I won't have to pay as long as
    I hold the house though my kids will have a huge tax bill when they >eventually inherit it. (Though the deferred tax will have to be paid
    before they sell it)

    --- PyGate Linux v1.5.12
    * Origin: Dragon's Lair, PyGate NNTP<>Fido Gate (3:633/10)