[procombo]

They're saying if that growth occured over 60 years then you've just kept up with inflation. Might as well have just put it in a standard savings account and NOT get capital gains tax. *Well, maybe a standard money market account or bond.

[medvezhenok]

Bonds also incur capital gains tax) The point of the capital gains taxes/inflation is specifically to incentivize people spending money over saving (if too many people saved money the economy would contract). It's not a perfect tool, but it works somewhat.

[procombo]

Income from bonds issued by the federal government and its agencies, including Treasury securities, is generally exempt from state and local taxes.

[tartoran]

Wait, wouldn't you get taxed capital gains on a standard savings account? I'm genuinely curious even though right now saving accounts are not saving anything at all.

[leephillips]

Tax on interest is at a different rate than capital gains tax.

[tartoran]

Which one is higher?

[leephillips]

I’m pretty sure that interest income is taxed, at the federal level, like wage income. In other words, at a higher rate than capital gains.

[loeg]

Long-term capital gains are taxed at a lower rate than ordinary income and short-term capital gains (which are taxed at income rates).

[gizmo686]

Earned interest is taxed as income at the federal level.

[procombo]

Oh, I know. Should it be taxed at the state level too?