Search

Mutual funds and exchange-traded funds (ETFs) differ in significant ways. ETFs trade on exchanges whereas mutual funds do not. ETFs generate few, if any, capital gains that are passed through to shareholders which makes them tax efficient. Alternatively, mutual funds often generate capital gains that are passed through to shareholders, and this makes them tax inefficient. To correct this tax inefficiency, Vanguard astutely added an ETF share class to many of its mutual funds back in 2001. They patented this structure and recently the patent expired. Several fund sponsors have applied to the Securities and Exchange Commission (SEC) to create this structure for their own funds. If approved, this would change the operation of affected funds in ways that are important to investors. [ABSTRACT FROM AUTHOR]

Municipal bonds, which are also known as muni bonds or simply munis, are commonly issued by state and local governments. Interest paid on munis is generally tax exempt which benefits investors in high tax brackets. Individuals should only own munis in a taxable account so they can capture the tax-exempt benefit. They have very low default/credit risk due to either a high credit rating and/or a third-party guarantee. Capital gains associated with these bonds are taxable unless the de minimis rule applies. Tax-exempt interest payments may also trigger the alternative minimum tax (AMT). Investors can purchase munis directly, or indirectly through a fund. [ABSTRACT FROM AUTHOR]

We examine the effects of stock market access, and in particular trading hours, on retail investment performance. Using discontinuities around time zone borders, we find that plausibly exogenous decreases in waking trading hours are associated with meaningful increases in retail investors' capital gains, as reported on tax returns for the U.S. population. Our results indicate that limiting trading hours curbs active retail trading, leading to improvements in portfolio performance. Our findings identify one negative effect of decreasing barriers to entry for retail investors in trading markets. JEL Classifications: M41; M48; G40; G51. [ABSTRACT FROM AUTHOR]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Purpose: This study aims to examine the potential of Sharia status as ex ante information to signal the quality of an issuing firm by improving the decision-making process of potential investors when assessing initial public offerings (IPOs) in an environment where information asymmetry is pronounced. Potential investors face challenges in evaluating and determining the true value of IPO issues, which inherently influences their decision-making. Consequently, this results in pronounced price fluctuations in IPO shares, leading to higher underpricing. Design/methodology/approach: This study uses a sample of 350 IPOs listed on the Kuala Lumpur Stock Exchange (KLSE) between 2004 and 2021 to examine the signaling role of Sharia-compliance status. A three-model approach is used to ensure that the study's objectives are met. The first model investigates the effect of Sharia status on underpricing to determine whether the main beneficiary of such a signal is the investor or the issuer. The second model examines the effect of Sharia status on investor demand to determine if such a signal influences prospective investors' investment decision-making processes. The third model inspects the effect of Sharia status on investor divergence of beliefs to measure the signal's ability to reduce information asymmetry within the Malaysian IPO market. Findings: The Malaysian IPO market relies heavily on the fixed-price mechanism, which exacerbates high information asymmetry, affecting potential investors' behavior, asset price formation and return generation on the first day of listing. The study results indicate that Sharia status does not have any signaling role in the Malaysian IPO market. This is because investors in the Malaysian market are driven by ex ante information that helps unveil relevant information that leads to capital gains. Furthermore, most new issues in the Malaysian IPO market fall under Sharia status, diluting the relevance of such information for prospective investors in determining profitable investments. Practical implications: The findings highlight the challenges faced by issuing firms in estimating market demand due to limited premarket insights and the difficulties prospective investors face in identifying the quality of issuing firms. Efforts to provide more information on investor demand can reduce uncertainty and facilitate more informed decision-making. Originality/value: This research stands as one of the pioneering efforts to provide an empirical explanation of the potential signaling influence of Sharia status in an emerging IPO market. [ABSTRACT FROM AUTHOR]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Die Unternehmensbesteuerung (Ubg) is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Capital gains tax burden from rebalancing is a major concern for managing factor portfolios in taxable accounts. This article conducts 98 simulated backtests over a 10-year investment horizon spanning from 1964 to 2021 to investigate this issue under heuristic constraint-based algorithm. The authors find that value, quality, and safety buy-and-hold (BH) portfolios were able to generate significant pretax and after-tax alphas without any rebalancing. Based on this observation, they construct a composite factor using these three factors. The composite factor portfolios consistently outperformed the benchmark in more than 80% of the simulated backtests. Their performance can be further improved by allowing trades so long as they do not realize any net capital gains, such as tax-loss harvesting and selling factor losers only when they do not carry any capital gains. The results provide a simple and robust portfolio solution for a broad range of tax-conscious investors. [ABSTRACT FROM AUTHOR]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Direct indexing (DI) combined with tax-loss harvesting (TLH) is a popular approach to generate capital losses to offset a client's capital gains while attempting to track a specified index. The goal is to increase after-tax excess returns by postponing or reducing tax payments. More TLH opportunities exist when the index constituents have a higher dispersion of returns and are therefore more likely to be at a loss. To create more TLH opportunities within DI, the authors propose a method to modify the target index to increase dispersion based on the realized volatility of stocks. They show that as the average constituent volatility increases, the effectiveness of DI TLH also increases against plain DI TLH that does not utilize this method. The authors further show that this method can significantly increase the after-tax excess returns versus plain DI TLH at the same tracking error per unit of additional returns. Further increases of dispersion can increase after-tax excess returns even more, although at a gradually higher cost of tracking error. [ABSTRACT FROM AUTHOR]

We study inequality generated by capital gains in the housing market by exploiting two countrywide data sources in Norway: a registry of housing units and a database of transactions. We identify and follow all individuals in six birth cohorts in Norway, who were owners on January 1, 2007, and on January 1, 2019, and estimate the sum of their actual and potential capital gains from their owned and sold properties. We demonstrate that there is a substantial increase in capital gains inequality over the period, both across and within geographical strata and across and within birth cohorts. We find a statistically significant and economically meaningful difference between the distributions of capital gains of female and male owners in Oslo. [ABSTRACT FROM AUTHOR]

We analyze the effect of leverage on tax-managed public equity strategies for different types of investors by running back-tests on hypothetical portfolios. We found the average 130/30 long/short portfolio funded with cash generates 2.7 times more capital losses than the average long-only portfolio over the first 10 years. For an investor with a sufficient supply of short- and long-term gains, these additional losses translate to average pre-liquidation tax alpha ("TA") of 4.41% per year. Liquidation reduces TA by about half, while a lack of short-term capital gains to offset reduces TA by approximately 40%. In combination, those investor characteristics may render a long-only loss harvesting portfolio or a low-cost ETF more desirable than a long/short tax-managed equity portfolio after costs and fees are taken into consideration. Leverage can also be used to revitalize an ossified portfolio whose loss-generating capacity has diminished. [ABSTRACT FROM AUTHOR]

The current System of National Accounts (SNA) Gross Domestic Product (GDP) concept does not measure the income generated by the production sector since it includes depreciation and excludes capital gains and losses on assets used in the production sector. The paper suggests an accounting framework that measures the income generated by the production sector of an economy and implements this measure using the Augmented Productivity Database (APDB) developed by Asian Productivity Organization and Keio University for China over the years 1970–2020. Real gross and real net income generated by the Chinese production sector are decomposed into explanatory factors including TFP growth using the framework suggested by Jorgenson and Diewert and Morrison. TFP growth is further decomposed into technical progress and inefficiency components using the nonparametric approach developed by Diewert and Fox. The APDB has estimates for the price and quantity of agricultural, industrial, commercial, and residential land used in China. The paper argues that changes in land use should be treated in the same manner as inventory change and added to the alternative output measures. It turns out that Jorgensonian user costs for land are frequently negative. The problems associated with negative user costs are discussed in the paper. [ABSTRACT FROM AUTHOR]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The World Migration Report 2020 shows that the number of international migrants increased from 84 million in 1970–272 million in 2019, accounting for 3.5% of the world’s population. This paper investigates the aggregated effect of emigration on the tax revenue of sending countries with a focus on developing nations. Using a gravity approach, we construct a time-varying exogenous instrument out of measures of changes in transportation technology from geographic time-invariant dyadic characteristics. Then, we follow an instrumental variable approach where we use our predicted emigration rate as an instrument of the observed migration rate. The results show that the predicted emigration rate is a good instrument of the current emigration rate for developing countries, and that there is a positive aggregated effect of emigration on tax revenue of sending countries. The results vary depending on the type of tax: emigration increases goods and services tax revenue, but it decreases income, profit, and capital gains tax revenue. [ABSTRACT FROM AUTHOR]

Persistent concerns about the digital divide are typically framed as a deficit of Internet access, skills or participation. Despite advances remedying first- and second-level divide issues, scholars have found that not all benefit equally from the Internet use resulting in the theorising of a third-level digital divide exploring the social determinants critical to benefit from the Internet use. Presenting analysis for three families from Aotearoa New Zealand, this work highlights the importance of the family in creating children's digital disposition. Applying Bourdieu's Theory of Practice concepts, we illustrate how parent's habitus informs children's responses to the digital world, shaping diverse forms of 'digital capital' which may result in 'capital gains' for some, and less capital benefits for others. Findings suggest that the forms of digital capital that are valued by families are closely tied to class positioning and cultural background. [ABSTRACT FROM AUTHOR]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Die Unternehmensbesteuerung (Ubg) is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Die Unternehmensbesteuerung (Ubg) is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The article provides an overview of the history of cryptocurrency and the current taxation and regulatory framework for cryptocurrencies. It discusses the conflicting views of the SEC and the IRS on whether cryptocurrencies should be classified as securities or property. The article highlights the challenges and shortcomings of current tax policies regarding cryptocurrencies, including the lack of specialized tax rules and the inapplicability of certain provisions. It suggests that the IRS should create a new classification for cryptocurrencies and update its tax system to effectively tax them. However, due to the unique nature of cryptocurrencies, there may never be a perfect solution. [Extracted from the article]

This article discusses a study that examines inheritance tax avoidance in the Netherlands. The authors use a clever methodology to test for the presence of estate planning by comparing the wealth levels of individuals who die unexpectedly to those with predictable deaths. The study finds evidence of estate planning, with the control group holding higher levels of financial wealth at a given age of death. The article also raises questions about the slope of wealth over time and the potential motives behind inter-vivos transfers. The findings are consistent with data from the Household Finance and Consumption Survey in the Netherlands. [Extracted from the article]

This document provides a list of recommended readings for undergraduate economics teachers, covering a range of topics including wealth taxation, corporate bonds, productivity growth, Federal Home Loan Banks, and non-fungible tokens (NFTs). It also mentions a special issue of the Journal of Benefit-Cost Analysis focusing on sustainable development goals. The document discusses the congestion pricing plan in Manhattan, implemented by the Metropolitan Transportation Authority (MTA), which aims to reduce traffic and raise funds for public transit. The Journal of Economic Education has published a symposium on economics education, highlighting the decline in students taking economics courses. Steven Levitt, co-author of Freakonomics, has retired from academic economics, citing a lack of impact and a desire to reach a wider audience through media platforms. The Dunning-Kruger effect, which refers to people lacking the expertise to recognize their own lack of expertise, is discussed in an interview with David Dunning. Edward Glaeser explores the concept of the "15-minute city" and its potential impact on racial and income segregation in American cities. The document also examines the changing nature of tipping in the United States, with tipping becoming more expected in various transactions. Lastly, it discusses the decline in the shareholder tax base in the United States, with foreign and tax-exempt investors now dominating stock ownership. [Extracted from the article]

Greening the environment cannot be achieved satisfactorily, considering that the private sector lags behind the public sector in participation levels. The purpose of this study was to determine the reasons behind the gap in green finance between the two sectors using numerically derived outcomes. Six-year data in the form of total shareholder returns, comprising capital gains and dividends paid from the largest banks in China, the USA, and Europe involved in financing fossil fuels, were extracted from Yahoo.com finance and Macrotrends public forums. Equity premiums were calculated from the total shareholder returns and risk-free rates. A 95% confidence interval was established to determine the lower and upper limits of the equity premiums. The resulting upper limits were used to project premiums that could attract the private sector by 2030. Equity premiums averaged 2.73%, 9.73%, and 4.31% for China, the USA, and Europe, respectively, indicating the substantial task in the USA of attracting the private sector compared to Europe and China. The projections of total shareholder returns showed the same patterns in equity premiums among China, the United States (USA), and Europe. To bridge the gap, the significant need for economic benefits for the private sector should ideally be addressed through green bonds, tailored to green financing projects that are earmarked for revenue generation. [ABSTRACT FROM AUTHOR]

In recent decades, football has attracted huge numbers of spectators and has become an increasingly popular sport among sports fans, a major entertainment industry and a growing concern for its financial sustainability. When assessing financial stability, it is essential to ensure that the financial statements are adequate, reliable and present a true and fair view. Playing rights are considered to be an indispensable resource for football clubs, but their evaluation is highly subjective. This also undermines the reliability of reporting and provides scope for manipulation of capital gains. This latter phenomenon has been evident in the operation of European football clubs, the most notable of which is Juventus. In this paper, we will attempt to examine the case of Juventus through a case study analysis, highlighting how the pricing of playing rights can help to portray a club's wealth, income and financial situation in a more favourable light, and the short and long-term consequences of manipulation. [ABSTRACT FROM AUTHOR]

Copyright of Revista Técnica Tributaria is the property of Asociacion Espanola de Asesores Fiscales and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Revista Técnica Tributaria is the property of Asociacion Espanola de Asesores Fiscales and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Based on an asset demand system, we develop a framework to quantify the impact of market trends and changes in regulation on asset prices, price informativeness, and the wealth distribution. Our leading applications are the transition from active to passive investment management and climate-induced shifts in asset demand. The transition from active to passive investment management had a large impact on equity prices but a small impact on price informativeness because capital did not flow from more to less informed investors on average. This finding is based on a new measure of investor-level informativeness that identifies which investors are more informed about future profitability. Climate-induced shifts in asset demand have a potentially large impact on equity prices and the wealth distribution, implying capital gains for passive investment advisors, pension funds, insurance companies, and private banking and capital losses for active investment advisors and hedge funds. [ABSTRACT FROM AUTHOR]

Copyright of Corporate Governance & Research & Development Studies is the property of FrancoAngeli srl and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Why do business leaders, senior politicians and civil servants move to leading positions in EU civil society? The article addresses this question through thirteen unique life-work history interviews with leaders of some of the most prominent EU civil society organisations (CSOs). Inspired by sociological approaches in EU civil society research, the article combines insights from the literature on EU lobbying and CSO professionalisation with the Bourdieusian concept of capital to explore the specific social resources that EU civil society and individual elite actors gain through the process of boundary crossing. It shows how EU civil society gains predominantly cultural capital (organisational and procedural knowledge), social capital (professional and personal networks), and symbolic capital (status and publicity), while individual elite actors gain primarily a form of civil society-specific symbolic capital that is associated with the alleged goodness of civil society and the act of ‘doing good’ that might facilitate policy influence. The article provides original, first-hand insights into how the civil society sector seeks to strike a balance between passion and professionalism and raises important normative questions about the integration of elites across economic, political, and civil society fields in Brussels. [ABSTRACT FROM AUTHOR]

At present, it is observed that individuals significantly increase the value of their assets, in many cases, such increases have no justification, so they omit the payment of their taxes, generating a low tax collection in the country. The objective of this research work was to analyze the criteria that allow the detection of the unjustified increase in wealth of Peruvian individuals. The methodology applied was qualitative, phenomenological design, with a non-probabilistic sampling based on the professional experiences of three experts in tax matters. The result was that the tax administration applies certain criteria, classified under the following headings: financial system, social, informality, auditing and digitalization. The most important criteria during the COVID 19 pandemic were e-commerce and social networks, used to generate income and evade taxes. It is concluded that natural persons incur in unjustified asset growth, due to lack of knowledge, because they do not wish to formalize or because they do not have a technical accounting team to guide them in the aforementioned criteria. It is suggested that the tax administration should supervise the new criteria related to digitalization in order to reduce unjustified capital gains in Peru. [ABSTRACT FROM AUTHOR]

Copyright of Zeitschrift für Stiftungswesen is the property of Verlag Oesterreich GmbH and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This study focuses on the Capital Gain of residential housing and its feasibility through bank financing in Hermosillo, Sonora. The purpose is to analyze the evolution of capital gain in the residential market and assess its possibility of acquisition through bank financing in the region. The main methodology includes a historical analysis of housing prices and a comprehensive evaluation of the current financing conditions provided by local banks. Key findings highlight a sustained increase in the capital gain of residential properties in Hermosillo. Economic and developmental factors have contributed to this constant growth. Furthermore, it has been proven that bank financing is a viable alternative for those interested in acquiring homes in this area. The capital gain in Hermosillo presents a promising outlook for both investors and buyers alike. The upward trend in housing prices, supported by favorable conditions in the local economy and urban development, highlights the potential for investment in the region. The availability of bank financing further facilitates access to the acquisition of residential properties, making it appealing for those seeking to invest in real estate in Hermosillo. In conclusion, this study underscores the viability of acquiring residential properties through bank financing and emphasizes the importance of considering capital gain as a valuable indicator in real estate decision-making in Hermosillo, Sonora. [ABSTRACT FROM AUTHOR]

This article introduces a practical method to maximize expected after-tax wealth and to fine-tune risk management utilizing linear programming instead of traditional Markowitz mean-variance optimization (MVO). Our simpler approach simultaneously optimizes asset allocation and asset location while considering capital gain impacts at the tax lot level. It is designed to be applied to portfolios individually. The approach's primary benefits include: explicit tax consideration across multiple types of accounts and tax-lot analysis within the optimization model, the ability to control risk under a variety of scenarios, clearer client communication via explicit quantification of the change in expected future after-tax wealth and the performance of the portfolio under selected scenarios, elimination of model-based and rule-of-thumb allocations, and better portfolios through customization. The technique can both identify a client's risk budget and rebalance portfolios. [ABSTRACT FROM AUTHOR]

Liberman et al. (2023) showed that tax-aware long-short factor strategies, within the first three years since inception, can realize cumulative net capital losses exceeding 100% of initially invested capital, all while generating a significant pre-tax alpha. This article explores the mechanism behind these remarkable results. Surprisingly, in tax-aware long-short factor strategies, net capital losses arise not from an increased realization of capital losses but rather from the deferral of capital gains, especially short-term gains on long positions. Despite reducing the gain realization, these strategies still allocate most of their turnover to trading in the direction of the alpha model, which explains their strong pre-tax performance. To achieve alignment with the alpha model, these strategies mostly rely on creating new positions and liquidating loss positions while avoiding the liquidation of gain positions. [ABSTRACT FROM AUTHOR]

Network marketing has seen no shortage of criticism, but its capital gain for corporate owners and top-tier sellers has remained consistent. In this article, we focus attention on the strategies from which this success emerges. Because the discourses which circulate in these spaces serve to uphold multiple oppressive systems at once and do so under the guise of a seemingly progressive feminism, we see import in demystifying their trends. By analysing brand materials of hair care and wellness company, Monat, as well as the prominent social media presence of some of its most affluent 'biz and beauty mentors', we argue that neoliberal feminism and Christian femininity are both demonstrated and reified through the figure of the online influencer we call the 'godly girlboss'. By exploring how the company's top sellers integrate messages of religion, beauty, wealth, and wellness, we argue that their rhetoric functions not only to help them sell shampoo, but also to engender investment in a specific white, Christian, feminine lifestyle. In this way, their social media influence operates not only as a capitalist tool, but a political one. [ABSTRACT FROM AUTHOR]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The United States federal income tax contains a flaw: Because it reaches capital gains only after a "realization" event, it permits owners of highly appreciated assets to defer their tax liability by holding them and refusing to sell. Worse yet, easily available debt allows those owners to consume from their "unrealized" gains while continuing to defer tax. As Professor Edward McCaffery identified in 2012, consumption and deferral through secured borrowing, coupled with the stepped-up basis death benefit from section 1014 of the Internal Revenue Code, create an opportunity for individuals to avoid lifetime income tax and net estate tax. This strategy, known as "buy/borrow/die," contributes to consumption inequality and, by extension, America's growing wealth inequality. In the tax literature, buy/borrow/die has served as a helpful hook for supporters of wealth taxes, mark-to-market income taxes, and the repeal of section 1014's stepped-up basis provision. But these three solutions merit some pragmatic concern, on the grounds that they are (to varying degrees) possibly unconstitutional, likely to be repealed, or publicly unpopular. Recognizing those practical obstacles should steer policymakers toward an incremental second-best solution: treating borrowing against appreciated collateral as a realization event. Embracing a "realization at borrowing" policy would reduce the availability of buy/borrow/die as a tax reduction strategy while sidestepping the hurdles that other proposed solutions must clear. [ABSTRACT FROM AUTHOR]

The racial wealth gap is the largest of the economic disparities between Black and white Americans, with a white-to-Black per capita wealth ratio of 6 to 1. It is also among the most persistent. In this article, we construct the first continuous series on white-to-Black per capita wealth ratios from 1860 to 2020, drawing on historical census data, early state tax records, and historical waves of the Survey of Consumer Finances, among other sources. Incorporating these data into a parsimonious model of wealth accumulation for each racial group, we document the role played by initial conditions, income growth, savings behavior, and capital returns in the evolution of the gap. Given vastly different starting conditions under slavery, racial wealth convergence would remain a distant scenario, even if wealth-accumulating conditions had been equal across the two groups since Emancipation. Relative to this equal-conditions benchmark, we find that observed convergence has followed an even slower path over the past 150 years, with convergence stalling after 1950. Since the 1980s, the wealth gap has widened again as capital gains have predominantly benefited white households, and convergence via income growth and savings has come to a halt. [ABSTRACT FROM AUTHOR]

This article examines the impact of tax laws on individuals from different racial and ethnic backgrounds. While tax rules do not explicitly consider race or ethnicity, variations in circumstances and choices can lead to different tax outcomes for different groups. The focus of the article is on the marriage penalties and bonuses in the federal income tax for married couples, which assess the tax consequences of filing a joint return. The study utilizes estimated data on race and ethnicity to analyze the marriage penalties and bonuses for various racial and ethnic groups. The findings reveal that the outcomes of penalties and bonuses differ based on income and race, with Black couples experiencing slightly higher penalty rates compared to White couples. The article highlights the marriage penalty and bonus in relation to race and ethnicity in the United States. It notes that Black couples filing jointly are more likely to face a marriage penalty compared to White couples, particularly in higher income brackets. However, White couples in lower income brackets also encounter a higher penalty rate. Hispanic couples, on the other hand, generally have a lower likelihood of facing a marriage penalty and a higher likelihood of receiving a marriage bonus compared to White couples, except at higher income levels. The analysis is based on tax and survey data, which may have discrepancies in reporting and recording race and ethnicity. Further research is necessary to comprehend these data differences and their impact on the analysis outcomes. [Extracted from the article]

Copyright of FinanzRundschau is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)