Why wasn't some of the cash treated as tax-free return of capital?
If all of your investment was treated that way, you'd just be hosed on the profit that you made on the deal. Yes, that ignores the time value of money, but ....
Tell HN: Company returned 3X, but I (investor) may lose money
21–30 of 36 posts
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#22Earlier quoted context omitted.
And the sadder part is that richer investors know their way around those taxes better than new comers because they have access to accountant professionals who can advise to pay less tax.
I'm not a tax expert so this assumption may be wrong, but if the 2X is being taxed as ordinary income at 35% wouldn't that imply that beagle3 is making at least $379,150 + 2X this year? I would consider someone with that kind of income to be rich. Also, if the stock has gone down 40% can't you claim that as a loss when you sell and lessen your overall tax burden?
> wouldn't that imply that beagle3 is making at least $379,150 + 2X this year? I would consider someone with that kind of income to be rich.
So what?
Seriously - do you think that the US govt or NYC is likely to do better with that money than he would have? Based on what?
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#23It's obvious, but this fact escapes so many people today: we do not have capitalism in the US.
What does a free market mean, anyway? Free of what? It means freedom from your neighbors, no matter if it's just one of them breaking into your house at night, or a whole bunch of them voting for laws to take what's rightfully yours by day. To put it another way, in a free market, others can't control when you buy or sell, nor can they take your money by force or fraud, even if they call it "taxes."
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#24It's obvious, but this fact escapes so many people today: we do not have capitalism in the US. What does a free market mean, anyway? Free of what? It means freedom from your neighbors, no matter if it's just one of them breaking into your house at night, or a whole bunch of them voting for laws to take what's rightfully yours by day. To put it another way, in a free market, others can't control when you buy or sell,…
Capitalism doesn't require a free market, and the definition of a free market allows for tax collection by the government.
Your definition of both is simply wrong.
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#25Why didn't you invest the money via a loan to an offshore company that then invested the money? That way you'd only pay tax when you paid yourself out of that company.
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#26Couldn't you have written 6-month PUT options?
Nit-Pick: 'Writing' == selling an option, and he would've wanted to buy puts (if it were legal).
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#27Earlier quoted context omitted.
I'm not a tax expert so this assumption may be wrong, but if the 2X is being taxed as ordinary income at 35% wouldn't that imply that beagle3 is making at least $379,150 + 2X this year? I would consider someone with that kind of income to be rich. Also, if the stock has gone down 40% can't you claim that as a loss when you sell and lessen your overall tax burden?
> wouldn't that imply that beagle3 is making at least $379,150 + 2X this year? I would consider someone with that kind of income to be rich. So what? Seriously - do you think that the US govt or NYC is likely to do better with that money than he would have? Based on what?
In my comment I did not state whether I agree or disagree with the current US tax laws and that was not the point. I was responding to the post above mine which I think made some incorrect assumptions concerning beagle3's income level and ability to afford professional accountants.
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#28It's obvious, but this fact escapes so many people today: we do not have capitalism in the US. What does a free market mean, anyway? Free of what? It means freedom from your neighbors, no matter if it's just one of them breaking into your house at night, or a whole bunch of them voting for laws to take what's rightfully yours by day. To put it another way, in a free market, others can't control when you buy or sell,…
Capitalism doesn't require a free market, and the definition of a free market allows for tax collection by the government. Your definition of both is simply wrong.
I don't agree.
Here's the most definitive definition of capitalism (written by what many today acknowledge as its greatest champion): http://aynrandlexicon.com/lexicon/capitalism.html
From the link: Capitalism is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned.
Today, we don't come close to this ideal. One example of this is that the government is the largest single landowner in the country: http://strangemaps.files.wordpress.com/2008/06/map-owns_the_... Need I mention Fannie Mae and Freddie Mac, the alphabet soup of regulatory agencies, the Federal Reserve, the giant social programs that redistribute forcibly? None of these things existed a century ago when this country was on the rise.
When I say “capitalism,” I mean a full, pure, uncontrolled, unregulated laissez-faire capitalism—with a separation of state and economics, in the same way and for the same reasons as the separation of state and church.
This is something we've never had, even in the 19th century. When we do, the human flourishing unleashed will make the lives for those who live it more vibrant and fulfilling than anything seen before on Earth.
Re: Tell HN: Company returned 3X, but I (investor) may lose money
#29Re: Tell HN: Company returned 3X, but I (investor) may lose money
#30Ouch. Now you know what it feels like to work for a startup.