Students

[Asher]

I have.

Physics.

[Asher]

By the way, because I paid for my own tuition, I got access to a ****load of tuition tax credits.

You should've seen how little income tax I paid my first year out of school.

[Asher]

Yes, that's what I wrote. Transferring your assets into cash and then using that to repurchase the same securities obviously sucks.

Why would I buy the same securities?

By the time he's that old, I'm sure they're some ****ty bonds or something he's holding on to.

I'd go for something with higher returns.

Yes, there is some tax to pay, but no, it's not any different from if he sold the investments back in 2001 to pay for my tuition. Potentially, that may've even been more costly.

[Kuciwalker]

Why would I buy the same securities?

You are missing the point.

[Asher]

No, I'm afraid you are.

[Kuciwalker]

Yes, there is some tax to pay, but no, it's not any different from if he sold the investments back in 2001 to pay for my tuition. Potentially, that may've even been more costly.

Your description didn't lead me to believe he would need to liquidate assets to pay for college.

[notyoueither]

Do securities have to be converted to cash, or can the cash value be used?

An aquaintance inherited stocks. I am sure that he sold them when he decided he wanted cash to start a business.

[Asher]

Yes, there is some tax to pay, but no, it's not any different from if he sold the investments back in 2001 to pay for my tuition. Potentially, that may've even been more costly.

Your description didn't lead me to believe he would need to liquidate assets to pay for college.

Why would he have large amounts of cash just sitting around, not invested in some form or another?

You make far too many assumptions in your haste to berate.

[Asher]

Do securities have to be converted to cash, or can the cash value be used?

An aquaintance inherited stocks. I am sure that he sold them when he decided he wanted cash to start a business.

It's my understanding that they are converted to cash. I'm not certain, of course, but I thought I read that somewhere.

[Kuciwalker]

Why would he have large amounts of cash just sitting around, not invested in some form or another?

You make far too many assumptions in your haste to berate.

He presumably has a regular income, either from a job (or if he retired early) from those same investments.

[notyoueither]

Non-registered capital assets are treated as having been sold

I thought so.

Edit. What happened to bolding?

[Asher]

He presumably has a regular income, either from a job (or if he retired early) from those same investments.

Why would he stop using his income to further invest? I'm sure you know the value of investing...

Plus, even with the income there's a lot of expenditures -- stock options to buy, taking full advantage of generous (but over-complicated )profit-sharing plans & RRSP matching, etc.

[Asher]

In addition to his "it'll teach you fiscal responsibility!" speech, there is another reason: If he paid for my tuition I'd have little reason to actively pursue work myself.

A lot of my friends had this happen. They took the summers off, did **** all, etc. while daddy paid for everything.

Once we graduated, I had a (relatively) lengthy resume with a wealth of diverse experience and an appreciation for earning money. They had **** all.

[Kuciwalker]

Why would he stop using his income to further invest? I'm sure you know the value of investing...

The entire point is that the capital gains tax introduces a substantial transaction cost for converting investments back into cash. They aren't fungible.

[Kuciwalker]

If he paid for my tuition I'd have little reason to actively pursue work myself.

Untrue. You'd be forgoing exactly the same amount of income either way.