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This is how rich people use art to evade taxes
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I subscribe to the communist ideology for the most part, and agree that millionaires and billionaires have a wide variety of ways to steal from the public, including tax theft.

However, this post is plain wrong. This is not how taxes work. If you pay $25k for something and it gains value, that increase in value is taxed when it's realised, and is in fact taxed significantly higher than capital gains tax. For getting a $20m write-off, the $20m has to count as income first.

We have a responsibility to be aware of how capitalism and chronyism are destroying our society, and we also have a responsibility to do that without being misinformed and just making shit up.

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Yes. There are many ways of evading taxes more convenient than art, but what's described here isn't even an actual thing. Art is convenient for laundering money by using the fact that you can get it valued at whatever price works for your purposes. But income tax only comes into play when actual money is exchanged. In that sense it's no different from increase in value of shares. Your Apple stock could be worth 1000x the price you bought them for, but you don't have to pay capital gains tax until you actually sell them at that rate.

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What tax evasion? In this example, I'm a guy with $5k in the bank. What taxes am I evading?

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That's why I said "realised". Appraisal doesn't matter either for most purposes. What you've "earned" from selling that piece of art is all about what you got paid for it. If I buy art for 1k and it is later appraised to be worth 101k, I'm not on the hook to pay taxes on the 100k that I don't actually have.

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3 years ago