Skip to main content
No. of Recommendations: 2
"But as others have pointed out, unless you are buying stock at the IPO or secondary offering you aren't actually investing capital in the company. Strictly speaking, you are saving, not investing."

well, yes and no....you buy a stock and you actually 'own' a part of the company. if they issue a million shares and you own 100, you are a part owner.

If he company pays dividends, YOU will collect them for risking your money owning their stock. It might go up. It might go down. the dividend might be cut in tough times.

If the company goes bankrupt - you lose 100%.

It's not like you are completely disinterested in the company. It's not like buying a CD with gov't guarantee of return of principal.

worse, income is figured yearly. Unless there is 1000% a year inflation, inflation does not come into the picture.

You buy a stock and hold it 30 years. You sell it. It might be 'worth' exactly the same after you calculate inflation. You have risked your money for 30 years. Hopefully collected a lot of dividends (think utility stocks). then you need to sell it. You don't really make any money. What cost you 100 hours of wages (dollar wise) in 1980) is exactly equal to 100 hours of wages in 2020. So why should you be taxed at regular income rates on essentially no gain in value?

Please explain.

Meanwhile lets say you bought a WV Camper Van in 1960 for $3000. Yesterday you sold it for $30,000. I'll be you didn't pay a dime in 'capital gains taxes' or regular income taxes, right? Didn't report a dime to the IRS. Why not?

No different than earning a stock.....which you bought at 3000 in 1960 and sold yesterday for 30,000....

so you'd be a tax cheat? report the sale of your WV? No way. But you'd report the sale of your stock because you have to.



t.
Print the post  

Announcements

The Retirement Investing Board
This is the board for all discussions related to Investing for and during retirement. To keep the board relevant and Foolish to everyone, please avoid making any posts pertaining to political partisanship. Fool on and Retire on!
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.