Quote:
Originally Posted by Barefootsies
b. Capital gains influences where I invest. Short or long term, and the money. Do I invest in my business, or do I invest in the stock market while I could maybe make some coin while stocks are down. Same as people cashing out their 401K's at this time have to consider the capital gains, and do they spend that money paying down debt, or buying new shit.
I know a handful of people in my personal life pondering this very decision right no on their 401k, and other shit. Having to pay capital gains, and penalties.
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There is no such thing as capital gains taxes on a 401(k)
401(k) is tax deferred money. No taxes are paid on capital gains or dividends. The money is taxed as ordinary income as it is withdrawn.
I don't see how capital gains tax rates will influence where you invest unless you're talking very short term investments (in which case it's more like gambling than "investing") because cap gains tax might be 15% today, but it could be 25% next year when you sell. You don't get a 15% future capital gains rate because you invested today. That's not how it works.