On Fri, Feb 11, 2000 at 10:15:14PM -0600, Christopher Browne wrote:
> a) Taxation of transactions can get far more peculiar than many of you
> have likely seen. When Odd Things Happen, and a tax professional gets
> into the game, their analysis of the critical transactions is far more
> important than the way things are recorded on the books.
I have to concur with this, just as an example for people not overly
familiar with tax consequences and investments, quite often there is a
difference between long term and short term capital gains, with a good
deal higher tax rate in the U.S. for the latter. It is now 12 months
that separate the two tiers, but I believe you used to have to hold
onto securities for 18 months to be considered long term. Then things
can be complicated by short sales (losses) to offset gains.
I'm involved in an investment club, and we bought a software package
(for Windows, unfortunately) that among other things prints a 1065 for
the Club and a K-1 for each individual. At one time I thought of
trying to reimplement this in some sort of open source way, but the
complexities of the tax code discouraged me.
The other things to consider are the facts that tax codes are revised
each year, which adds to the confusion and the issue of
internationalization. I see comments in the patches about supporting
different formats for stock/price rendering, but covering tax laws for
every country that Gnucash might be used in would be impossible.
If someone wanted to go all out, the minutiae of all of the different
share classes for mutual funds could be implemented, with say the
descending penalty scale for withdrawing from B class shares over the
first 7 years of holdings. Basically B shares have no upfront charge
to buy, selling in year 1 incurs a 25% 'charge,' but by year 8 you can
start selling without penalty because the shares get converted to class
A. [Or at least that is my understanding.] This is different from tax
implications, but shows all of the little stock issues that would have
to accounted for.
Lastly, consider something like money in a 401k (tax deferred)
converted to a traditional IRA (which incurs an income tax hit for the
year that the rollover takes place, but the money wouldn't be hit by
takes when it is distributed at retirement)-- for proper tax
calculations, Gnucash would have to keep track of the tax status of
every account. Actually, that might not be a bad idea for investment
accounts -- just a flag, even if it was just for 'user reference' and
not really used in the code for any calculations that indicated the tax
status of an account.
Some of these tax issues aren't even all that uncommon, I imagine they
get much more complicated as well.
Well, I guess I just added a long winded message to agree with
Christopher comment. But my point is that trying to make Gnucash as
robust tax wise as possible probably wouldn't be worth the time better
spent elsewhere.
-Kevin
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Kevin A. Foss ---- [EMAIL PROTECTED]
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