Let’s Talk About Higher Capital Gains Taxes

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  • Stocks sold off after a report that the White House was considering doubling the capital gains tax on the wealthy to 39.6%.
  • Although stocks were surprised, this was exactly what President Biden ran on, so it shouldn’t be a shock to anyone.
  • When will it start? If it starts next year, some could sell ahead of the higher taxes, but it could also be retroactive.
  • Higher capital gains aren’t necessarily bad for stocks. For example, the last hike was in 2013 and the S&P 500 Index gained nearly 30% that year.

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