A.I.M. Users Bulletin Board

[Conrad]

Something in the $ 9000 +$ 1000 Tax Story probably goes over my head!

Do I understand it correctly that Dr X invested $50000 and had to pay $ 9000 + $1000 in Taxes 7 weeks later without having made any gains on his $ 50000 so that his net investment was worth € 40000?

That works out to be a 148,6 % annual loss if his investment would stay at a value of $50000 for the following 45 weeks. In order to break even after a year his investment should generate $ 10000 net after the taxes Dr. X would have to pay on the new gains.

At a 42,1% average tax rate his earnings on the $ 50000 will have to generate a $ 17272 yie1d . . .or 35,54 % . . . .in a year from the date he invested the $ 50000.. . .and he would not have even gained a Penny!

Is that what the story implies?

Who is to blame for such strange taxation laws?
Could Obama have prevented this from happening if he knew about this?