Trump Capital Gains Tax Cut Talks Include Inflation Indexing

President Trump is considering indexing capital gains for inflation as part of tax cut discussions. Under such a plan, taxes would be levied only on real gains after adjusting for inflation.

For instance, if an investor bought a stock for $100,000 and sold it five years later for $200,000 with cumulative inflation of 20%, the cost basis would rise to $120,000. The taxable gain would then be $80,000 instead of the nominal $100,000.

In addition, the proposal includes excluding home sales valued at $2 million or less from capital gains taxes. More details are expected soon.