Just in time for tax day, I wrote a post on my Yahoo! Finance contributor page about the biggest tax mistake you can make as an investor. Put simply, the spread between short- and long-term capital gains tax rates is so giant now, you’re better of lighting your wallet on fire than taking profits on investments you’ve held for less than a year. At least all that burning cash might be pretty to look at.
Speaking of taxes and stupid ideas, the New York Times asked a bunch of experts about the worst tax breaks. Their answers should be familiar to regular readers of this blog. I’ve written on just about all of them at some point.
We will be hearing a lot about tax reform in the months ahead, as every presidential candidate will crow about their plans to rein in, reduce, and simplify our country’s insanely complex tax code. The chances that any of these ideas will amount to anything but empty promises on the campaign trail are close to nonexistent, of course, but it can’t hurt to dream, can it?
Earlier this week, I watched the documentary Page One about the inner workings of the New York Times and the dire financial difficulties daily newspapers face to survive. It’s a great movie. It’s also a very depressing movie. Journalism is one of my passions. Every year, I lecture at the journalism schools of UC Berkeley and Northwestern, and I believe an informed citizenry is vital for our country’s economic and cultural wellbeing. That’s why it’s so disturbing to see newspapers dying all over the country while glib, superficial, and often politically slanted outlets like Gawker and the Huffington Post thrive.
The movie also touches on another depressing trend in American business–the “strip and flip” mentality of too many private equity firms, and the warped way our tax system aids and abets these destructive behaviors.
Something extraordinary happened last week: a politician went against the dogma of his own party and proposed something that might actually boost our economy and improve our country’s long-term fiscal health.
Of course, the plan has no chance of getting a vote, let alone passing congress. And even if it did manage to pass, President Obama would veto it before his first morning cigarette. But just because Representative Dave Camp’s tax reform bill is a lost cause doesn’t mean it’s not a worthy one.