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Hang Onto Your Hat. Train Comin' Down The Track . . . Fast!

Kaight
  |     |   1,192 posts since 2011

Guys this new tax law deal appears to me actually to have legs. I think it is gonna happen . . and soon. Ho, boy, look out! This thing will free up huge sums of money at corporations. Many are saying those entities will be buying back their own stock.

What happens with stock prices when there is a preponderance of buyers? Bet I don't gotta tell you. And then not long thereafter the new withholding tables will kick in, they are saying by February first. Many people are gonna have a lot more cash to spend than is today the case. Methinks the entire country will be coming back to life . . . I mean REALLY back to life.

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jamesstewart
  |     |   64 posts since 2011
Just like Nasdaq 1999, real estate 2006; the party that will never end. Those who cannot remember the past...
So how long have we been in this upward march of the business cycle? Perhaps we should heloc borrow on our houses and even get more cash to spend just like the government is doing with tax payer debt to keep things rolling.

And when will those CD interest rates start to soar?
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JWARREN
  |     |   69 posts since 2017
The "J. Wellington Wimpy" tax cut plan: My children and grandchildren will gladly pay you in the future for my temporary tax cut today!
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Bozo
  |     |   1,375 posts since 2011
JWarren, it's not all bad news for your heirs. To the extent the bill enhances share prices and your net worth, your heirs will receive a step-up in basis on your death. Plainly stated, all the appreciation in your taxable investments will escape taxation, unless over the applicable threshold in the Estate Tax.

Estate Planning 101: Unless you really, truly, need appreciated taxable investments in retirement, the best plan is to harvest dividends (which will usually be LTCG or QDivs, taxed at a lower rate) and leave the principal to heirs.

Example: Joe and wife have 10,000 shares of XYZ mutual fund. Over the years, the shares have appreciated in value. Joe and wife die. The heirs receive a step-up in basis and pay no tax on the appreciation, so long as the Estate is worth less than roughly $22 million, the threshold for a married couple.
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Bozo
  |     |   1,375 posts since 2011
Kaight, personally, I love the concept of stock buy-backs and increased dividend yields. After all, LTCGs and QDivs already have preferential tax treatment. This will not change under the new law. Folks below $250,000 taxable income (married, filing jointly) will still benefit from a 15% rate on those LTCGs and QDivs. In tax-advantaged accounts (IRAs and 401Ks), enhanced corporate profits should lift the equity side of such accounts.

That said, will your average Joe and Jane benefit? I wonder. Do I care? Probably not.
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Kaight
  |     |   1,192 posts since 2011
Well it is less than a week since I wrote the OP. At this point I'm looking personally at a 15+% tax cut, which is seriously sweet. Younger people than me finally are gonna get out from beneath the ACA's vicious boot heel with lifting of the un-American "individual mandate". What a blessing for those very deserving young Americans. Corporations are announcing higher minimum wages and Christmas across-the-board bonus payments. Small businesses are receiving a much-needed shot in the arm. American strength and independence are being bolstered, at LONG last, by the allowing of ANWR drilling for vital oil.

There is SO much good happening it is very nearly overwhelming. Christmas has broken out all across America, with the sad exception of places like NJ, NY, IL, and CA. I hope those states will realize the error of their ways, climb aboard this wonderful train, and join their fellow Americans who are doing things the RIGHT way. I want everyone to be a winner, just like America herself! What a great country!! Merry Christmas to ALL!!
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darkdreamer4u
  |     |   350 posts since 2010
The BS meister at it again - sickening.
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Kaight
  |     |   1,192 posts since 2011
Uh-oh. Methinks someone has found coal in their Christmas stocking.

Merry Christmas to you ESPECIALLY, dark one. You need the good wishes, it would appear, far more than most folks. I hope the light dawns for you soon. Best of everything to you!
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Kaight
  |     |   1,192 posts since 2011
On top of all the other great stuff that is happening, as if that were not enough, the weather mavins here where I live are saying chances for a white Christmas are significant. It has been a number of years since we have awakened Christmas morning to snowfall. The ground outside right now is bare; no snow at all. Fingers are seriously crossed for a positive outcome on this one. Hoping for a cold, windy, snowy, Christmas morning with a roaring fire in the old fireplace and with America finally forging ahead big time. Green lights are everywhere. The shackles are off at last!!
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