Abolish Capital Gains Tax

Mark Twain once said, “Democracy is the worst form of government…except for every other kind.” And even though the United States of America is the best place in the world to live (sorry Canada, England, Scotland, Ireland, Germany, Japan, et al, but you know it’s true), there are some things that just plain suck. “Capital gains tax”, for one.

A few years ago, I bought some property for a really good price (nearly 55 acres for $24,000.00) from an Oklahoma law firm, who acquired it through a foreclosure auction. Well, since it was from a foreclosure, there were back-taxes (plus interest and penalties) that needed to be settled for a sum of about $20,000.00 (I didn’t really mind paying the back taxes, getting stuck with the interest and penalties is an injustice in itself – it wasn’t MY fault the taxes weren’t paid, but I’m the one who gets penalized. But that is a rant for another day…).

Still, $44,000.00 for nearly 55 acres is a great price. Well, I finally sold the land to someone, who actually wants it and will use it, for considerably more than I put into it. Unfortunately, I’m afraid the “capital gains tax” that I will now have to pay will take a considerable chunk of the profits – I think the current rate is 40%. Sheesh! Of course, it could be worse – back in the early 60’s, the rate was 90% (talk about disincentives!).

But even with the taxes, I’ll make some money on the deal, but not nearly as much as I should have.