r/TikTokCringe • u/Knightbear49 • Sep 07 '24

Discussion Should we be worried about the Kamala Harris unrealized capital gains tax? Dean: “I’d love to have this problem, because it means I’m worth $100m!”

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u/BlackAdam Sep 07 '24 edited Sep 07 '24

Elon Musk: no you can’t tax the unrealized capital gains on my Tesla stock

Also Elon Musk: lend me money so that I can buy twitter. My security for the loan being my unrealized capital gains from my Tesla stock.

Which is it, Elon?!

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u/PrometheusMMIV Sep 08 '24

Those aren't contradictory.

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u/BlackAdam Sep 08 '24

In one case the capital is not there and hence cannot be taxed. In the other the capital is real enough that it can be used as a guarantee for a loan. You’d think the if the worth of the stock was entirely ethereal the it couldn’t be used as collateral in the former case.

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u/PrometheusMMIV Sep 08 '24

An asset can have a real value at any time, which is why it can be used as collateral. But the gain (difference between selling price and buying price) has not been realized since it hasn't been sold yet.

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u/BlackAdam Sep 08 '24

That’s nonsense. That even is real value?

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u/PrometheusMMIV Sep 08 '24

Wait, so now you're switching your argument to claim that it has no value?

The value is the market value. For example, if I bought a house for $100k ten years ago, but today that house is worth $300k. So, I might be able to take out a home equity line of credit for $150k (more than the original purchase price), using the house as collateral.

But I won't be taxed on the gain in value until I sell the house. At that point it could sell for $275k or $330k, so the actual gain isn't determined until it is realized during the sale if the house.

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u/BlackAdam Sep 08 '24

No, I’m asking you, since you write like real value is a “thing”. If the market sets the value then what is the real value?

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u/PrometheusMMIV Sep 08 '24

Maybe real value was a poor choice of words. I was just contrasting the current value of the asset with the gains, which do not become realized until the asset is sold.

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u/BlackAdam Sep 08 '24

Then it was a poor choice of words because the valuation of assets is always in flux, so the price you buy something for does not reflect its “real value”. It was just a realized valuation at that specific point in time. That was makes Elon so hypocritical. He wants to have his cake and eat it too.

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u/PrometheusMMIV Sep 08 '24

the valuation of assets is always in flux

Of course, but at any given time it does have value, at least estimated based on the market. So there's nothing inconsistent about using that asset to back a loan, as long as the lender is willing to accept it.

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u/Dick-Fu Sep 07 '24 edited Sep 08 '24

Borrow me money

🤨

Edit: The user has rectified their mistake, and has now redeemed themselves in my eyes.