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FYI, there is a proposed new tax to be levied on all traders: it's called Bill HR 1068.
Please read here Info & Sign Petition
Additionally, if you'd like more info & ideas on what you can do personally, please read the note below. It contains the following:
-- explains more about the tax;
-- provides a real-life example of it's impact;
-- gives suggestions on what you can do to help block the tax;
-- provides links for more info
--Please feel free to copy/paste into your own e-mail and send to others requesting support. If you would like a copy of the WORD.doc, go to the
File Share and click on "Bill HR 1098 letter 022709.doc"
Why is this important to you as a trader, or to eSignal/QCharts as a provider of charts?
There is a very real, very significant tax implication to this Bill HR 1068. I believe that it could mean the difference between whether some traders can continue to trade or must go get a different job because they can't afford the additional taxes. I also believe it would be an huge disincentive to new traders trying to learn and break into the trading business as one will pay taxes on transactions in addition to profits. So, in the beginning, when a trader will typically have more losers than winners, their tax burden would be prohibitive to continuing. And, if traders don't continue to trade, they will not continue to utilize charts. So, it's very real; it's very significant; and the impact will be huge to all concerned.
Please tell your congress people and senators to vote AGAINST Bill HR 1068.
Thanks for listening.
Carol
An Oregon Congressman has proposed a Bill that is detrimental to active traders/investors, like me – and maybe like you – because even if you are not an active trader, if you have a pension, IRA, 401(x), mutual fund, annuity, etc., these added taxes will be absorbed as “management fees.” And, extra management fees paid means less profits/retirement money for you.
So, I’m asking for your help. I’m passing along some website links which will allow you to sign a petition http://tinyurl.com/c5pywh against the passage of the proposal and will automatically submit an email to your Senators and Congress people. Additionally, please call this wayward congressman; e-mail him; contact your state congress people & senators and let them all know what a horrible tax burden it presents and ask them to vote AGAINST the bill. I know this is asking a lot – and, please know that the impact of this bill on any of you as traders will be immediate and severe. The impact on any of your retirements may be further off in the distance – but it will also be severe.
The Bill, H.R. 1068 (for the text of the bill, click here: http://tinyurl.com/d4tg5p ), basically imposes a 0.25% transaction tax on the sale and purchase of financial instruments such as stocks, options, and futures. While this may sound minimal, it could amount to a round-trip charge of $50 on a 100-share purchase of stock. For example, say Apple Computer’s stock is trading at $100/share:
• 100 shares x $100/share = $10,000.
• Calculating the tax: 0.25% x $10,000 = $25. That’s $25 to buy-to-open, and then $25 to sell-to-close the trade; or $50 for every round-trip trade. And that's on every trade that’s made.
• The important thing to realize is that this bill adds an additional tax to the transaction.
• The profits are taxed separately at the end of every quarter!
What is the direct impact of this Bill? What does this mean in actual dollars to someone like me? As an example, I made 15 round-trip trades in the month of February. Using the AAPL example, above, that means:
• $50x15 = $750 ADDITIONAL TAX to me for the month of February.
• Arguably, $750/month ADDITIONAL TAX throughout the year!
• Amortized for the year ($750x12), that would be an ADDITIONAL $9000 in taxes I would owe!
• Imagine if your retirement account is hit with this kind of additional tax burden.
• Finally, realize that the Bill HR 1068 also indicates that the tax will be paid regardless of profit. You win the trade, you pay. You lose the trade, you pay. Kind of like if you sell your house at a loss and pay capital gains anyway. Kind of like your IRA lost 60% of its value last year and now, you’re going to pay even more management fees on top of that.
Not only is this an huge tax burden, but our newly elected president has gone on record, multiple times addressing the nation, saying he is cutting taxes for those making less than $250,000/year. (Sadly, I’m one of those people.)
“Middle class families will see their taxes cut -- and no family making less than $250,000 will see their taxes increase. The typical middle class family will receive well over $1,000 in tax relief under the Obama-Biden plan, and will pay tax rates that are 20 percent lower than they faced under President Reagan.” (*)
(*)See Obama’s website: http://www.whitehouse.gov/agenda/taxes/
Here’s the help I am asking from you:
(1) Go to this website where you will find more information on the Bill and how to sign the petition against its passage and to send emails/letters to Congress. Please sign the petition.
(2) Call Congressman DeFazio’s office – 202-225-6416 – and speak with his legislative aide “Auke.” He will try telling you it’s “just 0.01 per $4 – no big deal.” Well, I think he doesn’t understand trading or basic math and what this really means. Please feel free to share my personal example, above.
(3) E-mail Congressman DeFazio: http://www.house.gov/formdefazio/contact.html
(4) Contact your state congress person and ask them to vote AGAINST this bill. They DO respond when enough constituents make their voice known. So speak UP. https://writerep.house.gov/writerep/welcome.shtml
(5) Contact your state senator and ask them to vote AGAINST this bill. They DO respond when enough constituents make their voice known. So speak UP. http://www.senate.gov/ (see upper right hand corner, “Find Your Senators”)
(6) Contact your HR Department at work. Ask them what your company is doing to fight this added tax burden in order to help preserve your retirement funds. If they don’t know what to do, please share this letter with them and ask for their support. Yes, it WILL impact your retirement. And, it will impact you whether your company is publicly traded or privately held because all retirement funds are directly linked to the stock market.
(7) If your company has a bulletin board where you can post items of interest to all employees, please post this and ask people to help.
(8) Contact/e-mail the financial news agencies asking them to report on this:
• Cramer: [email protected]
• Squawk: http://www.cnbc.com/id/22737253/
• Power Lunch: [email protected]
• Fast Money: http://www.cnbc.com/id/22408221/
• Street Signs: http://www.cnbc.com/id/22898571/
(9) I encourage you to forward this message to any family, friends, co-workers, or acquaintances that will be impacted by this unfair tax. This might include anyone who is a trader/investor, or has a pension plan, 401(k), 401(b), 401(anything), IRA, mutual fund, annuity, etc. Ok, well, that’s just about every legal adult you know, and maybe even some illegal’s. Encourage each of them to please sign the petition http://tinyurl.com/c5pywh and also the rest of the help requested. Encourage them to share this information with everyone they know and ask for help in defeating this bill.
Thanks for your help!
Carol
Ps: below are some comments from several Portfolio Managers you might find interesting, as well as a couple more links if you want more info.
Andrew Hart, Portfolio Manager:
“This is government's method to find a scapegoat for the financial mess and it is likely to backfire. In my view, taxing all trades (wins and losses) will affect liquidity most. In raising the cost of trading many traders, which are small business owners, may stop trading or reduce shares/contracts traded. Reduction in liquidity can have broad implications as we saw in the credit markets in late 2008.”
Scott Downing, Portfolio Manager:
“As we have seen in the past, taxes create a shift in supply and demand. If this tax is imposed upon traders, the banks and the brokers will have to lower their margins to compensate for the tax as they try to keep traders in the game. We already know that the banks and the brokers are in dire straights right now, so this is not a good solution to the problem. As the government continues to lend money to companies and take ownership stakes in these companies, it makes most traders want to stay away from the markets because they can't predict the government's next action. The tax will ultimately take us further away from the free market flow of capital that drives our nation's economy, lengthening the current recession.”
Moby Waller, Portfolio Manager:
“While certainly there is Main Street anger against Wall Street due to the scumbag Madoffs of the world and for other reasons, an additional tax on active investors is not the answer. A bill like this will actually decrease trading volume and inhibit a potential market recovery into a new bull market that will lift all boats (and 401Ks, etc). It also will not help the troubled financial sector, which is at the heart of much of our current fiscal mess. I actually also would support a lowering (or temporary removal) of capital gains taxes on securities trades (both long and short term) as a means to boost the markets through increased buying activity.”
Please read here Info & Sign Petition
Additionally, if you'd like more info & ideas on what you can do personally, please read the note below. It contains the following:
-- explains more about the tax;
-- provides a real-life example of it's impact;
-- gives suggestions on what you can do to help block the tax;
-- provides links for more info
--Please feel free to copy/paste into your own e-mail and send to others requesting support. If you would like a copy of the WORD.doc, go to the
File Share and click on "Bill HR 1098 letter 022709.doc"
Why is this important to you as a trader, or to eSignal/QCharts as a provider of charts?
There is a very real, very significant tax implication to this Bill HR 1068. I believe that it could mean the difference between whether some traders can continue to trade or must go get a different job because they can't afford the additional taxes. I also believe it would be an huge disincentive to new traders trying to learn and break into the trading business as one will pay taxes on transactions in addition to profits. So, in the beginning, when a trader will typically have more losers than winners, their tax burden would be prohibitive to continuing. And, if traders don't continue to trade, they will not continue to utilize charts. So, it's very real; it's very significant; and the impact will be huge to all concerned.
Please tell your congress people and senators to vote AGAINST Bill HR 1068.
Thanks for listening.
Carol
An Oregon Congressman has proposed a Bill that is detrimental to active traders/investors, like me – and maybe like you – because even if you are not an active trader, if you have a pension, IRA, 401(x), mutual fund, annuity, etc., these added taxes will be absorbed as “management fees.” And, extra management fees paid means less profits/retirement money for you.
So, I’m asking for your help. I’m passing along some website links which will allow you to sign a petition http://tinyurl.com/c5pywh against the passage of the proposal and will automatically submit an email to your Senators and Congress people. Additionally, please call this wayward congressman; e-mail him; contact your state congress people & senators and let them all know what a horrible tax burden it presents and ask them to vote AGAINST the bill. I know this is asking a lot – and, please know that the impact of this bill on any of you as traders will be immediate and severe. The impact on any of your retirements may be further off in the distance – but it will also be severe.
The Bill, H.R. 1068 (for the text of the bill, click here: http://tinyurl.com/d4tg5p ), basically imposes a 0.25% transaction tax on the sale and purchase of financial instruments such as stocks, options, and futures. While this may sound minimal, it could amount to a round-trip charge of $50 on a 100-share purchase of stock. For example, say Apple Computer’s stock is trading at $100/share:
• 100 shares x $100/share = $10,000.
• Calculating the tax: 0.25% x $10,000 = $25. That’s $25 to buy-to-open, and then $25 to sell-to-close the trade; or $50 for every round-trip trade. And that's on every trade that’s made.
• The important thing to realize is that this bill adds an additional tax to the transaction.
• The profits are taxed separately at the end of every quarter!
What is the direct impact of this Bill? What does this mean in actual dollars to someone like me? As an example, I made 15 round-trip trades in the month of February. Using the AAPL example, above, that means:
• $50x15 = $750 ADDITIONAL TAX to me for the month of February.
• Arguably, $750/month ADDITIONAL TAX throughout the year!
• Amortized for the year ($750x12), that would be an ADDITIONAL $9000 in taxes I would owe!
• Imagine if your retirement account is hit with this kind of additional tax burden.
• Finally, realize that the Bill HR 1068 also indicates that the tax will be paid regardless of profit. You win the trade, you pay. You lose the trade, you pay. Kind of like if you sell your house at a loss and pay capital gains anyway. Kind of like your IRA lost 60% of its value last year and now, you’re going to pay even more management fees on top of that.
Not only is this an huge tax burden, but our newly elected president has gone on record, multiple times addressing the nation, saying he is cutting taxes for those making less than $250,000/year. (Sadly, I’m one of those people.)
“Middle class families will see their taxes cut -- and no family making less than $250,000 will see their taxes increase. The typical middle class family will receive well over $1,000 in tax relief under the Obama-Biden plan, and will pay tax rates that are 20 percent lower than they faced under President Reagan.” (*)
(*)See Obama’s website: http://www.whitehouse.gov/agenda/taxes/
Here’s the help I am asking from you:
(1) Go to this website where you will find more information on the Bill and how to sign the petition against its passage and to send emails/letters to Congress. Please sign the petition.
(2) Call Congressman DeFazio’s office – 202-225-6416 – and speak with his legislative aide “Auke.” He will try telling you it’s “just 0.01 per $4 – no big deal.” Well, I think he doesn’t understand trading or basic math and what this really means. Please feel free to share my personal example, above.
(3) E-mail Congressman DeFazio: http://www.house.gov/formdefazio/contact.html
(4) Contact your state congress person and ask them to vote AGAINST this bill. They DO respond when enough constituents make their voice known. So speak UP. https://writerep.house.gov/writerep/welcome.shtml
(5) Contact your state senator and ask them to vote AGAINST this bill. They DO respond when enough constituents make their voice known. So speak UP. http://www.senate.gov/ (see upper right hand corner, “Find Your Senators”)
(6) Contact your HR Department at work. Ask them what your company is doing to fight this added tax burden in order to help preserve your retirement funds. If they don’t know what to do, please share this letter with them and ask for their support. Yes, it WILL impact your retirement. And, it will impact you whether your company is publicly traded or privately held because all retirement funds are directly linked to the stock market.
(7) If your company has a bulletin board where you can post items of interest to all employees, please post this and ask people to help.
(8) Contact/e-mail the financial news agencies asking them to report on this:
• Cramer: [email protected]
• Squawk: http://www.cnbc.com/id/22737253/
• Power Lunch: [email protected]
• Fast Money: http://www.cnbc.com/id/22408221/
• Street Signs: http://www.cnbc.com/id/22898571/
(9) I encourage you to forward this message to any family, friends, co-workers, or acquaintances that will be impacted by this unfair tax. This might include anyone who is a trader/investor, or has a pension plan, 401(k), 401(b), 401(anything), IRA, mutual fund, annuity, etc. Ok, well, that’s just about every legal adult you know, and maybe even some illegal’s. Encourage each of them to please sign the petition http://tinyurl.com/c5pywh and also the rest of the help requested. Encourage them to share this information with everyone they know and ask for help in defeating this bill.
Thanks for your help!
Carol
Ps: below are some comments from several Portfolio Managers you might find interesting, as well as a couple more links if you want more info.
Andrew Hart, Portfolio Manager:
“This is government's method to find a scapegoat for the financial mess and it is likely to backfire. In my view, taxing all trades (wins and losses) will affect liquidity most. In raising the cost of trading many traders, which are small business owners, may stop trading or reduce shares/contracts traded. Reduction in liquidity can have broad implications as we saw in the credit markets in late 2008.”
Scott Downing, Portfolio Manager:
“As we have seen in the past, taxes create a shift in supply and demand. If this tax is imposed upon traders, the banks and the brokers will have to lower their margins to compensate for the tax as they try to keep traders in the game. We already know that the banks and the brokers are in dire straights right now, so this is not a good solution to the problem. As the government continues to lend money to companies and take ownership stakes in these companies, it makes most traders want to stay away from the markets because they can't predict the government's next action. The tax will ultimately take us further away from the free market flow of capital that drives our nation's economy, lengthening the current recession.”
Moby Waller, Portfolio Manager:
“While certainly there is Main Street anger against Wall Street due to the scumbag Madoffs of the world and for other reasons, an additional tax on active investors is not the answer. A bill like this will actually decrease trading volume and inhibit a potential market recovery into a new bull market that will lift all boats (and 401Ks, etc). It also will not help the troubled financial sector, which is at the heart of much of our current fiscal mess. I actually also would support a lowering (or temporary removal) of capital gains taxes on securities trades (both long and short term) as a means to boost the markets through increased buying activity.”
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