Invest in America with Wefunder Opportunity Funds

The calculations show an investor’s potential after-tax returns under different scenarios, assuming an investment of capital gains prior to December 31, 2019, a 10 year holding, annual investment appreciation of 7%, as selected by the user, and a long-term capital gains tax rate of 23.8% (federal capital gains tax of 20% and net investment income tax of 3.8%), only taking into account tax at a federal level (not state). Note, however, that the performance assumptions shown are for illustrative purposes only, and are not intended to reflect the actual experience of any individual investor.

The calculations for the standard stock portfolio are based on rolling over capital gains equal to $100,000, at an initial tax of 23.8% (using the same assumptions described above), into a standard stock portfolio, the remaining $76,200 of which then appreciates at a compounding return of 7%. At the end of each holding period, the investment in the standard stock portfolio is assumed to be sold and long-term capital gains at a tax rate of 23.8% paid on the capital gains from the investment in the standard stock portfolio.

The five-year hold calculations for the Opportunity Fund are based on rolling over capital gains equal to $100,000, at an initially deferred tax rate of 0%, into an Opportunity Fund, with the entirety of the $100,000 then appreciating at a compounding return of 7%, until the fifth year of the hold, at which time the initially deferred tax is reduced by 10% and the net amount is taxed at a rate of 23.8%. In addition, at the end of the holding period, when the investment is assumed to be sold, long-term capital gain at a tax rate of 23.8% is paid on the gains or profits from the investment in the Opportunity Fund itself.

The seven-year hold calculations for the Opportunity Fund are based on rolling over capital gains of $100,000, at an initially deferred tax of 0%, into an Opportunity Fund, with the entirety of the $100,000 then appreciating at a compounding return of 7%, until the seventh year of the hold, at which time the initially deferred tax is reduced by 15% and the net amount is taxed at a rate of 23.8%. In addition, at the end of the holding period, when the investment is assumed to be sold, long-term capital gain at a tax rate of 23.8% is paid on the gains or profits from the investment in the Opportunity Fund itself.

The ten-year hold calculations for the Opportunity Fund are based on rolling over gains of $100,000, at an initially deferred tax of 0%, into an Opportunity Fund, with the entirety of the $100,000 then appreciating at a compounding return of 70%, until December 31, 2026, at which time the initially deferred tax is reduced by 15% and the net amount is taxed at a rate of 23.8%, effectively reducing the principal invested in the opportunity fund accordingly. Thereafter, returns continue to compound at the same initial rate of 7%. At the end of the tenth year of the holding period, the investment in the Opportunity Fund is sold and the capital gains on the investment in the Opportunity Fund itself is taxed at a rate of 0%.