Greetings again,
Thomas Lunde wrote:
> As to virtual profits earned by speculation,
I have debunked this misconception on prior occasions. Trading in
futures, options, and other leveraged instruments (which is the usual
method of determining just who are speculators in financial markets) is
a zero sum game. Losses and profits net out.
> when times are good, they
> reinvest and do not declare any profits
Also have corrected this before: In the US at least, re-investment of
winnings has no effect on their taxability.
> and when they lose, they claim their
> loses and do not pay any taxes or greatly reduced taxes.
Trading & investment losses are limited to US$ 3,000/tax year as
deductions from taxable income (not from taxes themselves). Remaining
losses can be rolled over to subsequent years.
> One of the
> thoughts I had was that labour should have the same option. If I get laid
> off a good paying job and take a lesser paying job, why can I not deduct my
> loss of income as a valid income loss just like business and speculators do?
A lesser gain is not the same as an outright loss. It is more akin to an
'opportunity loss'. I agree that it can be painful; progressive tax
brackets could in theory ameliorate this to some extent.
Regards,
Steve
