Reply To: will the long-term capital gains rate remain in law for 2021

Home Fairmark Forum Taxation of Investments will the long-term capital gains rate remain in law for 2021 Reply To: will the long-term capital gains rate remain in law for 2021

#71036
Kaye Thomas
Moderator

Congress has never enacted a tax law that is retroactive in the way you indicate, so we don’t have a definitive answer to the question whether it would be unconstitutional. Language in at least one Supreme Court opinion suggests that Congress would be unwise put this issue to the test, and it seems unlikely that this Congress or any other will ever do so. If the proposal to eliminate lower rates for long-term capital gains becomes law, it will have a prospective effective date, though not necessarily from the date of enactment. My guess is that it would be effective from the date the legislation is approved by the House Ways and Means Committee, on the theory that this action places taxpayers on notice about the change.