Things are getting hot in the Golden State. A planned wealth tax worries 1% of California’s very wealthy who wonder, is everything they’ve worked so hard to acquire in danger of being taken away?
This state’s wealth tax is different from any other. Its goal is to tax people with a net worth of more than $50 million. Of course, Dominion understands why this idea would make people worried.
You’ve come to the right place to learn the truth about the planned California wealth tax and figure out what to do next. If you think you might be affected by the wealth tax, please join us as we find out the truth.
We’ll talk about how this tax might affect businesses and who it would affect the most. We’ll also look into why this tax was put in place and give our opinion on the matter.
Here’s What California’s Wealth Tax Is All About
The first thing you need to know about this topic is that the wealth tax is not designed to balance California’s budget. On the contrary, it is made to take money from the rich and provide it to the needy according to the state’s decision. As you can probably understand, that does not work to your advantage.
Supporters of this tax explain that the implementation of this tax would in a way minimize the existing gap between the rich and the poor and at the same time generate the much needed resources which would be used to fund many crucial services within government departments. Of course, there is more to the issue than this. So we believe it’s important that we all just take a moment and get our bearings on exactly how this tax operates.
Here’s How It Would Work
Let’s say your net worth exceeds $50 million. Anything above that would require you to pay a 1% tax. And if your net worth is more than $1 billion, the rate increases to 1.5% on the value beyond that $1 billion level.
What’s more, the wealth tax is based on your entire net worth. That means everything from real estate and stocks to bonds and other assets—all of it is part of the tax, which gets computed annually. It essentially taxes everything of your possessions, not just your income.
Who Does This Target?
Unsurprisingly, the richest people living in California. And it spans individuals with great fortune to businesses and trusts with significant wealth. The goal here is to tap into the wealth of those who have accumulated a lot of money, regardless of their annual income.
According to a piece from the Sonoma Index-Tribune, California has a stark income inequality, stating that wealth for lower income earners is getting lower while the top 1% enjoys significant income growth. There’s a lot of public support for the wealth tax, but is it really the right answer?
The tax might seem like a decent approach to advancing equity, but we really should consider what could happen as a result of it. At Dominion, we take issues like these very seriously, and we’re not afraid to ask the tough questions.
So, we ask: will this tax really fix California’s lower income problems or remedy areas that are lacking the necessary funding? Or will it just shift around money and investments without long-term solutions? Our guess is the latter.
How Does This Affect High-Net-Worth Individuals?
For those affected by the wealth tax, the implications could be financially devastating. And even though 1% or 1.5% seems like such a small number, look at it like this: If your net worth is $100 million, you are facing an annual tax burden of $1 million.
It’s Even Worse for Billionaires
This is a high cost and can lead to the draining of your wealth in the long run, making reinvestment more difficult, charity support less likely, and legacy building for the next generation more unlikely.
Based on how much weight this tax puts on their shoulders, many wealthy people may decide to move to places like Florida or Texas, where there is no wealth tax. After all, the whole “wealth exodus” phenomenon should present real concern given that it may amount to fewer tax dollars and less investment in California.
Is It Time to Stay or Go?
A bunch of factors have to be considered including business interests, family ties and lifestyle preferences. Dominion knows that all clients have their own concerns. Once we look through your circumstances, we find a proper strategy that would meet your demands.
If moving isn’t an option or doesn’t make sense, then we’ll look at other things that might be able to offset the wealth tax. Because of this, you’ll want to investigate whether any potential investment strategies will save on taxes, like keeping it long term, tax loss harvesting, or municipal bonds.
We can assist you in assessing whether it’s worth transferring your assets or settling down tax wise in a better location. That’s why we want to provide you with as much of the information and tools you need in making good financial decisions.
You Need Asset Protection That Works for You
Your money needs a plan that is made just for you and your situation. At Dominion, we make that plan from the ground up, taking into account your wants, goals, and risk tolerance level.
We’ve got an expert team that’s ready to get to know you and your situation. We’ll then get to work crafting a tailored strategy designed to achieve your goals. We know that boundaries don’t really affect prosperity. Because of this, we’ve built a large network of legal and financial advisors around the world.
We work in all of the major markets and important jurisdictions for asset protection all over the world. Our lawyers are local; they live and work here, so they really know the rules and customs of this area.
Because we work with clients all over the world, we can negotiate complicated legal systems and come up with smart solutions just for you.
Change Is an Inevitable Circumstance
Laws are always changing, and new issues are always popping up. To ensure we’re always two steps ahead at Dominion, we are always adjusting our strategies to fit the times. We stay current on local and international laws so that we’re able to spot any opportunities or risks and factor in how they might impact your wealth.
This helps us to stay ahead of the game, and it ensures your money is secure no matter where it’s located. Maybe it needs to stay put. Maybe it needs to be in an offshore trust. We are here to assist you and provide you peace of mind in knowing that our specialists are constantly thinking ahead and looking after your assets.
We Manage Your Wealth Beyond Asset Protection
We’re experts in asset protection, but it’s not all we specialize in. We believe that true, effective wealth governance requires a lot more than protecting your assets. It’s a holistic practice that includes asset management, growing your wealth, and making sure it’s safe for the next generation in your family.
At Dominion, we strive to make sure that each of our clients has the tools, knowledge, and resources necessary for total wealth management. That’s why we offer:
- Estate planning
- Tax planning
- Charity advice
So, whatever your goals and desires are as a HNWI, we’ve got a solution for you. Also, we don’t limit you to just one or two services. We integrate the financial attention you need seamlessly. That way, you’ve got a cohesive strategy designed to make the most of your wealth while promoting healthy financial well-being.
Experienced and Ready to Assist
We’ve got a team that’s seen decades of unique financial challenges and needs. So, no matter how complex or dire you think your situation is, you can trust that we’ve been there and done that countless times over. Want to know why we’re so confident in our ability to help you?
Each member of our team is an expert in tax codes, the various financial markets, and investment strategies. Our expertise has been forged in the fires of real-world financial problems—problems that we’ve helped countless clients overcome with expert precision. Real results. Real financial stability and freedom.
Your wealth is part of your legacy, and it’s one you want to protect at all costs. You want your loved ones to be secure and worry-free, and Dominion is the solution to make sure that happens. We have a long-term vision to help you enjoy the peace of mind you deserve.
You’ll be able to sleep comfortably at night knowing your assets are in highly accomplished, capable, and knowledgeable hands. Do it for you. Do it for your family.
Build a Legacy that Lasts with Dominion
The California wealth tax puts you as a HNWI or UHNWI in the crosshairs. It’s a problem for the money you’ve worked so hard to attain, but it’s not an impossible mission that can’t be overcome. With the pros at Dominion by your side, you can rest easy knowing you’ve got a trusted advisor fighting for your wealth.
If you’re concerned that the proposed wealth tax will adversely affect you, we’d like to help you. Call us to schedule a consultation to discuss what is the right long term financial solution that meets your needs.
.jpg)
