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| By getting your affairs in order, I mean the need for estate planning and liquidity in estates will increase substantially over the current estate tax laws. Better have a strategy in place to pay the tax man if you have meaningful assets to transfer to the next generation, particularly assets that have appreciated considerably in value. Halving the current estate tax exemption, coupled with doing away with stepped up basis, and a doubling of the current capital gains tax all added up, and well,let’s just say it will require a truckload of cash upon your demise. Most likely won’t even be able to utilize the current unlimited marital deduction to leave your assets to your spouse with stepped up basis. You die and your wife could owe up to 39.6% cap gains on the gain over your cost basis. Also proposed is doing away with 1031 exchanges on amounts over $400,000, most likely retroactive back to the first dollar if you trigger the $400,000 limit. How all this could be considered bullish on real estate and equities is beyond me. The only bright spot is (if you can at all consider this a bright spot) if real estate and equities collapse under the weight of all the new taxation laid upon them, is a goodly share of the taxable gains will evaporate through much lower valuations. Eventually real estate and stocks will reach an equilibrium based upon these newly imposed taxes. Be no different if real estate taxes jumped to $300 acre, what are the chances valuations stay the same? Eventually the values would settle in proportion to the taxes. Regarding equities and elections, history has shown far more money was lost trying to time the market exiting positions ahead of the election than if one would have simply stayed the course long term. This time may very well be a strong exception to historical trends.
Edited by Boone & Crockett 10/30/2020 00:57
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Short Term NYSE
