Question For 4um folks:

Source: https://vidrebel.wordpress.com
Published: Mar 7, 2021
Author: Horse
Post Date: 2021-03-07 08:15:12 by Horse
Views: 424

It has been suggested that we will have a market correction before Income Taxes are due on April 15th. On one hand some suggest that a crash will force people to sell to pay taxes. On the other hand some think a crash will give taxpayers deductible losses which will cut IRS revenues.

Bonus thought: A Minsky moment is when investors sell the good stuff to pay for the bad stuff. That could happen in April if margin calls have to be met to cover tanking stocks like Tesla. Personally, I am not in the stock market.

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#1: Ada    To: Horse (#0)

some suggest that a crash will force people to sell to pay taxes. On the other hand some think a crash will give taxpayers deductible losses which will cut IRS revenues.

Most filers expect a refund.

And any deductible loss cannot be taken until the next taxable year.

Ada posted on 2021-03-07 08:45:48   Reply   Private Reply

#2: Darkwing    To: Horse (#0)

I file in early Feb, refund in 4 weeks, I get it over with ASAP.

Darkwing posted on 2021-03-07 10:09:31   Reply   Private Reply

#3: Esso    To: Horse (#0)

On the other hand some think a crash will give taxpayers deductible losses which will cut IRS revenues.

Losses in 2021 don't affect 2020 taxes.

Esso posted on 2021-03-07 10:17:51   Reply   Private Reply

#4: Horse    To: Ada (#1)

And any deductible loss cannot be taken until the next taxable year.

Good points. But people with investments and businesses have to pay additional taxes apart from withholding.

Horse posted on 2021-03-07 10:41:59   Reply   Private Reply

#5: Horse    To: Esso (#3)

True. I never filed a long form in my life. Never had any taxes apart from taxable income from wages.

Horse posted on 2021-03-07 10:43:34   Reply   Private Reply

#6: Pinguinite    To: Horse (#0)

Taxes due by Apr 15 were from finance records for the 2020 calendar year, so any crash between now and then won't reduce the amount due this year. It could be some are planning to sell stock and such to pay the 2020 taxes and they'd be hurt.

In that scenario, many might use the expected "stimulus" pay out to pay tax bills.

Pinguinite posted on 2021-03-07 10:51:59   Reply   Private Reply

#7: Lod    To: Pinguinite (#6)

Those people won't qualify for any stimulus cash.

Lod posted on 2021-03-07 11:52:16   Reply   Private Reply