They always go back and forth republicans lower taxes and then we have an astronomical rise in the stock market and then democrats raise taxes before that growth turns into a crash.

Bush cat taxes, then Obama raise them and then trump cut them again and now joe is about to raise them.

It's a never ending cycle.

That doesn't seem to end any time soon.

In fact, it's actually good for the economy since they balance each other out.

Don't get me wrong, I'm not trying to support one party over the other.

This is not what we do on the channel.

Let's please keep our political beliefs within ourselves and focus on what matters which is bytedance new tax plan, whether you like it or not, that's the reality on the ground.

It's going to impact you.

So we'll try to answer a few questions in this video.

What is the new tax plan?

How is it going to impact you?

How is it going to impact the stock market?

How is it going to impact the real estate market?

Who will benefit from this tax race and whether you should be worried or not, we'll answer all of these questions and many more.

But before we do that, make sure to check out our second channel called Proactive clips, where we share with you short clips from the main channel.

So if you miss something from the main channel, you might come across it on the second channel or we might share short clips from older videos you might not have watched.

So you might come across something very, very interesting or time to time we might create short videos specifically for that channel.

If you don't want to miss all the juicy stuff, make sure to check out proactive clips and subscribe will forever be grateful.

And now let's get back to joe biden's tax plan.

First of all, Biden wants to raise income tax to 40 and this is what politicians usually do.

They talk a lot about raising taxes on the rich, but then they end up raising the income tax.

Real rich people rarely have income tax.

Take the richest person in the world, Jeff Bezos, His income is $82,000.

That's not even six figures.

The proposed tax rates isn't going to impact him.

It sounds great when politicians say it is not going to impact anyone who makes less than $400,000 but it's going to impact all these lawyers, engineers, doctors who make over $400,000 there.

The middle class and under biden's new plan, Every dollar they earn above $400,000 is going to be taxed at a high rate.

They are going to suffer the most from this new tax plan.

But the new tax plan is also going to hurt the real rich as well.

I'm actually really surprised Biden wants to raise the capital gain tax to almost 40 Just in case if you don't know capital gain taxes 20 for long-term investments now, it literally wants to double that rate, which means every dollar you earn from the rise of the stock.

When you realize your gains or when you sell your stocks will be taxed at 40%.

You made $100,000 after selling your apple stocks.

$40,000 of that is going to go to Uncle Sam.

I think Jeff basis anticipated something like that.

That's why he sold $7.2 billion worth of amazon shares last year.

Because if he had done that under biden's new tax plan, he would have paid much more taxes.

But here's the catch, The proposed capital gain taxes only for households making more than $1 million $1 million dollars or more a year, then you shouldn't be worried about this tax rate.

Usually when taxes are raised, rich people wait until the new administration comes in and lowers taxes and then they start selling their stocks to realize their gains.

But how about real estate?

How Biden's new tax plan is going to impact real estate investors.

Don't forget that capital gain tax isn't only apply to stocks, but it also affects real estate.

If you purchased a property a few years ago, for $1 million, for example, and now you want to sell it because the price of your house has skyrocketed recently.

If you sell it, let's say for $1.5 million, you will have to pay a 40 capital gain tax.

But most real estate investors avoided capital gain tax through a little loophole code section 1031 exchange.

Under this tax break, if owners of the property used the funds of the cell of one property to purchase another property within 100 and 80 days, then they can avoid paying the capital gains tax.

But biden's new tax plan eliminates that loophole when capital gains are greater than half a million dollars.

This is literally the golden tax break of the real estate market.

I'm not really sure how much of an impact it is going to cause the markets, but I guess if it is going to pass, then a lot of investors would trash to sell their properties before the tax plan would go into effect.

That could mean there will be an oversupply of houses in the market, which could drive home prices down in the coming future.

But it also could turn the other way around why sell now and pay so much tax is when you can just wait for the next administration to bring that loophole back.

That might prevent a lot of people from selling their houses, which could keep real estate prices as high as they are now.

Only time will tell, biden's plan also includes a call for increased audits on high earners that could collect an additional $700 billion in tax revenue.

It seems like Biden is about to wage a war against the rich.

I'm really surprised to see all this coming from him, but the main question is, who is going to benefit from biden's tax plan?

He wants to raise taxes in order to raise money to spend more on infrastructure.

So let's take a look at the potential beneficiaries of this plan.

First of all, biden wants to create a $225 billion.

National paid family and Medical leave Program.

Paid leaves are coming, but not to everyone, only $4 to take time off to care for a newborn or an ill family member.

The plan includes $225 billion to help low income families pay for childcare providing funding to childcare providers.

The plan includes a lot of other things that we don't have time to get into, such as a few $100 billion to free universal preschool for all three and four year olds and so on.

But the most notable part about it was the capital gain tax and the income tax rate.

But what does that mean for the economy If you pay attention to how the economy works?

It follows a certain cycle which we have covered in previous videos.

But here is the point.

In short, the economy has four main stages and it starts with expansion.

It keeps growing until it reaches the pig and then it slows down and grows just enough to cop with inflation.

But at certain point it falls into a recession which is also known as contraction and once it reaches the lowest point it raises again.

I believe we have reached the bottom last year where the economy fell into a recession.

But then the facts stepped in and flooded the market with cheap money.

And since then we are in the expansion period and now it's time for the government to slow down the growth to a certain extent, to prevent it from falling into another crash in the foreseeable future.

The last expansion lasted almost 10 years.

It was the longest expansion in the history of the United States.

No one really knows how long this one will last.

But from now onwards, the inflow of cheap money is going to stop and the government will keep raising taxes.

So forget about the kind of growth we had last year anytime.

So now it's your turn to let me know.

What do you think about biden's new tax plan?

Do you like it?

Do you think we should get rid of that little capital gains tax loophole?

We have.

I'm really curious to find out what you guys think by the way.

Don't forget to check out our second channel.

Proactive clips where we post pretty much every single day.

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Thanks for watching and until next time.