Capital Gains Tax

    More in Capital Gains Tax

    How to Calculate Rental Property Appreciation for Income Tax Purposes

    A property’s appreciation is an increase in its value. When you invest in a rental property, you pay income taxes on its appreciation only when you sell the property. The amount of appreciation on which you pay income taxes is called the capital gain. Your capital gain ...

    How to Calculate Tax on Sold Shares

    When you sell shares of stock or other capital assets, you almost always end up with a gain or loss. The Internal Revenue Service insists that you report capital gains and pay taxes on them. You may use capital losses to offset capital gains or other income within IRS limits. ...

    What Is Considered Holding Long-Term for Stocks?

    The Internal Revenue Service considers stocks to be a capital asset. The market value of your stock can rise or fall without generating a taxable event, but once you sell your stock, the IRS gets involved. You will have either a capital gain or a capital loss, depending on ...

    How to Determine a Stock's Date of Death Value

    The value of stock on the date of the owner's death is required for a couple reasons – to value assets of the person's estate, and to calculate the cost basis. If you’re the executor of an estate, you’re allowed to value and report the estate’s assets. ...

    How to Figure Capital Gain on a Rental House

    Capital gains are always figured in the year you sell or dispose of a capital asset. The Internal Revenue Service categorizes rental houses as income-producing business property. This excludes rental homes from the gain exclusion reserved for personal residence sales – ...

    How to Figure How Much Tax Is Owed on a Stock You Sold

    When you sell a stock for more than you paid for it you make a profit. The Internal Revenue Service refers to this profit as a capital gain, and wants its fair share in the form of capital gains taxes. How much you pay in capital gains tax varies based on how long you owned the ...

    Does It Make a Difference How Short-Term & Long-Term Investments Are Accounted For?

    The profits you earn from short and long-term investments are taxed differently, so it is important to have a system to separate the two groups of investments. It is also likely that your short- and long-term investments result from different strategies, and you probably also ...

    Do You Need to Pay Capital Gains Tax on Inherited Property If Sold?

    Selling property you own can trigger capital gains tax, even if you inherited it. You typically need to know your original cost of the property in order to calculate a capital gain. Because you didn’t spend anything for inherited property, a different amount called a ...

    Do You Owe Taxes on Stock Sold From Reinvested Dividends?

    A dividend reinvestment plan for stock dividends provides an automatic path to compound growth of your stock investment. The challenge of dividend reinvestment is to keep track of the reinvestment amounts and the potential tax consequences of all of those reinvestment amounts. ...

    How to Pay Capital Gains Selling Inherited Stock

    The tax impact of selling stock you inherited is a little tricky, because you didn’t pay anything to acquire it. Capital gains tax normally is calculated by subtracting your cost from the sales proceeds. Your cost is called “basis.” A similar process applies to ...

    Do I Pay Any Taxes on Ginnie Mae Funds if I Buy & Sell the Same Year?

    If you earned a profit from the Ginnie Mae fund investment, you will be liable for some taxes. The length of time you owned the fund helps determine how much in taxes must be paid. As a bond fund, the Ginnie Mae fund can generate several different types of taxable income.

    Do You Have to Pay Taxes on Selling Gold?

    For tax purposes, selling gold is much like selling other capital assets in that you end up with a capital gain or loss. The Internal Revenue Service treats investments in gold and other precious metals a bit differently than it does investments such as stocks and bonds. The ...

    Do I Have to Report All My Stock Purchases & Sales if I Lost Money?

    When you sell stocks, your broker issues IRS Form 1099-B that summarizes your annual transactions. While you do not have to report money you lost because you do not pay tax on it, agents at the IRS expect to see details about your stock sales on your return, because Form 1099-B ...

    Taking a Loss on Useless Stocks

    When you’re left holding worthless stock, the sting is alleviated a little by taking a loss on your tax return for your cost to purchase the shares. You don’t need to report the reason for the stock losing all its value, but you need to know when you acquired it and ...

    The Tax Implications of Selling an Investment Property at a Loss

    Investment properties can be a great source of income in stable and growing markets. However, in declining housing markets the sale of an investment property might result in a loss. This results in a tax implication called a capital loss, which can be deducted on your tax ...

    Tax Liabilities When Investing in Gold

    The Internal Revenue Service considers gold and other precious metals to be capital assets for tax purposes. If you make a profit from investing in gold, your gain is taxable and must be reported on your income tax return. However, precious metals are taxed differently than ...

    Tax on the Sale of Precious Metals

    Investments in precious metals, such as gold, silver and platinum, are similar to other investments in that your holdings are capital assets, according to the Internal Revenue Service. The money you make or lose is a capital gain or loss. However, some special rules apply when ...

    Tax Treatment of REIT Payouts

    One reason the shares of real estate investment trust companies are popular is the high distribution payouts from many of these stocks. However, the distributions received from REIT shares are taxed differently than dividends from the shares of corporations. Consider the ...

    A Tax Treatment of a Return of Capital and Closed-End Funds

    The universe of closed-end funds offers a range of choices for investors looking for high-yield investments. These funds use a variety of strategies to enhance the income to investors, and these strategies produce different types of income under the tax rules. It is possible for ...

    Taxation of Split Stock Sales

    A stock split happens when a company you've invested in issues new shares, increasing the total number of shares you own. A "2-for-1" stock split means you receive one new share for each share you own. Companies usually split their stock to bring the market price down ...

    Taxes on Gains From Investments

    Investing some of your money is a smart financial move to provide gains and keep your wealth safe from economic risks. All investments have the potential to earn you money, but whatever you earn will also have tax implications. Paying taxes on your investment gains may impact ...

    Are There Capital Gains on STRIPS Treasury Bonds?

    Stripped Treasury bonds, or STRIPS, are U.S. Treasury bonds which do not pay regular interest payments. Instead, Treasury STRIPS are purchased for much less than maturity value. The difference between the price and the amount received when the STRIPS mature represents the ...

    Do I Pay a Capital Gains Tax Only When I Sell Reinvested Dividends?

    Reinvesting the dividends paid by a mutual fund or a stock in a dividend reinvestment plan -- DRIP -- is a great way to get compounded investment growth. Dividends you earn -- including reinvested dividends -- are taxed in the year you earn them. Capital gains on the shares ...

    Income Tax Rate on Common Stock Gains

    When the stocks you own have increased in value, it can be fun to get out the calculator and add up just how much you've made. But it's important to remember that if you sell, you might have to share some of your gains with the government. How much you'd pay in tax, if any, ...

    Are Losses in Mutual Funds Tax-Deductible?

    If you have a mutual fund account that has decreased in value, you can use the loss as a tax deduction, but only if you have sold your fund shares. A loss on a mutual fund investment is included in the capital gains and losses reporting on your income tax return.

    What Are the Taxes on Selling Stocks?

    When you buy a share of stock and its price goes up over time, you can sell it at the higher price to realize a profit called a capital gain. Capital gains are subject to federal taxation, so you typically owe taxes when you sell stocks. The exact amount of capital gains tax ...

    Tax Implications of Selling Stock

    Investing in assets such as stocks that have the potential to increase in value over time is a common wealth-building strategy that raises several tax considerations. When you sell a stock for an amount that is greater than the original price you paid, you make a return called a ...

    How to Determine a Long-Term Tax Gain

    Having your gains count as long-term capital gains helps because they are taxed at a lower rate than ordinary income, including short-term capital gains. If you don't figure the gains properly, you might miss out on extra costs that you can deduct or forget about carry forwards ...

    How to Calculate Capital Gains for Decedent Stocks

    In most circumstances, determining the amount of capital gains tax you owe on the sale of a stock is a matter of simple arithmetic. You subtract the sale price from the price at which you sold it, determine if it is a short- or long-term gain, and apply the applicable gains tax ...

    The Tax Consequence for Trading Stock

    The liquidity of the stock market makes it easy for you to buy and sell shares. You have the choice of investing over the long term or over a shorter period. A day trader seeks to earn a profit by speculating on daily price movements in the stock market. A day trader pays ...

    What Is the Taxation of Physical Gold When It Sells?

    Because gold has been the basis of currency for centuries, it is a popular place for investors to place their money if they are fearful of declines in currency value. It is also a source of windfall income, as many people inherit jewelry or have other gold items that they no ...

    How to Report a Loss for Worthless Securities on Your Taxes

    Typically, if you want to take a tax loss on a security, such as a stock, you can simply sell it on the open market and record the details of your transaction. If you own a worthless security, however, things get a little more complicated. With no active market, you can't record ...

    Taxes on the Sale of a Home & Capital Loss

    Home ownership is an investment, and your home's value can change over time, just like stocks and other assets. If the value of your home increases after you buy it, you can sell it to realize a profit called a capital gain. Capital gains are generally subject to federal ...

    Capital Gain Rules When Selling & Reinvesting Stock

    When you sell stock at a price higher than you purchased it, you will incur a capital gain. Depending upon the timing involved in the buying and selling of the shares, you may be eligible to use a special lower tax rate on the money you made. Use Form 1040, Schedule D to report ...

    How Long Do Capital Gains & Losses Carry Forward?

    On your tax return, capital gains and losses get their own section and extra forms. Gains may be taxed at a different rate than the rest of your income, and those unfortunate losses get put to good use as tax write-offs. You have a significant amount of control when gains and ...

    Definition of a Mutual Fund's Short- & Long-Term Holding Period

    When you receive the Form 1099 for your mutual fund's capital gains distributions, those payouts will be divided into long- and short-term gains for you to report on your tax return. The mutual fund company uses the same rules you would to determine whether a gain on an ...

    Are Capital Gains on American Eagle Coins Taxable?

    American Eagle Gold and Silver coins are an easy way to make investments in the two types of precious metals. As with any kind of investment, the IRS will collect capital gains tax if you generate capital gains on your investment. Gains on collectible coins like American Eagles ...

    The Definition of Realized Gain and Loss

    Even if you aren't a long-term investor, you're probably familiar with the concept of gains and losses. From a tax perspective, you don't really have a gain or a loss on an investment until you "realize" it. Realized gains and losses are reported on your taxes and can ...

    How to Report Art Gains on a Schedule D

    If you've sold a valuable work of art or a collectible, the Internal Revenue Service wants to hear about it on your tax returns. The agency levies federal capital gains tax on asset sales of any kind, whether it's stocks, bonds, real estate or "collectibles," a ...

    Do Tax Losses & Gains Cancel Each Other Out?

    Although your investment objective is to have a lot more gains than losses, any losses you do incur can be used to reduce or offset any capital gains you have to report. The tax rules spell out how losses must be used, and the tax return forms take a step-by-step approach to ...

    Information on Capital Gains and Income Taxes

    Purchasing assets that have the potential to increase in value over time is a common wealth-creation strategy. If the value of an asset rises, you can sell it at a price higher than the amount you paid to realize a profit called a capital gain. Taxation of capital gains depends ...

    Can You Buy Back Stocks After Selling at a Loss?

    Selling stocks on which you have taken a loss produces capital losses that you can use as tax writeoffs. You can buy the stocks back, but not too quickly. The tax code includes a "wash sale" rule that prevents investors from selling stocks to get a tax loss and then ...

    How Are Mutual Funds Taxed?

    Mutual funds are professionally managed investments that offer returns based on the performance of an underlying pool of assets, such as stocks, bonds and commodities. Mutual funds can produce returns in the form of capital gains, capital gain distributions and dividends, each ...

    How to Enter Short-Term Capital Gains

    If you've made money selling assets you've owned for less than a year, such as stocks or other investments, you must share the news with the Internal Revenue Service. The way you report the gains depends on how they were reported to the IRS on Form 1099-B, if at all. You also ...

    Is it Better to Sell My Stocks That Have Dropped in Value Before or After the New Year?

    Selling your loser stocks produces a capital loss that you can use as a tax write-off. When to sell depends on your tax situation, your other investment results and capital gains tax rules. To use a loss for the current year's taxes, you must sell your stock before the end of ...

    IRS Rules for Taxes on Long-term Capital Gains

    Unlike men, not all income is created equal in the United States, at least under the Internal Revenue Service tax code. Long-term capital gains receive preferential tax treatment in the form of lower tax rates than short-term capital gains and ordinary income rates. Long-term ...

    How to Report 1099-B Losses on Schedule D

    Not everything you invest in turns out the way you hoped. If you've lost money with certain investments, the Internal Revenue Service lets you use those losses to reduce your taxable income. Even if your losses are larger than your gains, you can claim a deduction and ...

    How to Determine the Cost Basis for Mutual Funds

    If you sell mutual fund shares, you must report the gain or loss on your taxes. The amount to report will be what you received for the shares minus your cost basis in those shares. Since a mutual fund allows you to add money whenever you want and investors often reinvest ...

    How to Report Capital Gains & Losses From Mutual Funds

    Mutual funds are a simple way for investors to get diversified exposure to the stock and bond markets. Reporting gains and losses from fund investments is not so simple. If you did not sell any fund shares during the year, you just plug the reported capital gains distributions ...

    Can You Claim Stock Market Loses on Your Income Taxes?

    Losing money on a stock you've invested in is never welcome news. However, you can minimize the damage by claiming the loss as a deduction on your income taxes. Writing off a stock market loss is a bit complicated because you must combine it with other capital gains and losses ...

    Tax Laws Regarding Losses in the Stock Market

    Stock market losses don't help your net worth, but they might help your tax refund. The Internal Revenue Service lets you deduct stock losses on your taxes. However, depending on the size of your losses and other gains, you might not be able to use all your losses in the same ...

    Does Reinvestment of Dividends & Capital Gains Increase the Cost Basis of Mutual Funds?

    The reinvestment of mutual fund distributions -- dividends and capital gains -- does increase your cost basis. A higher basis is a good thing because you will pay less in capital gains taxes with a higher basis if you sell your fund shares. Tracking your cost basis will prevent ...

    Investments & Tax Laws

    Understanding how your investments are taxed is an important part of successful investing. Tax laws vary depending on the type of investment you own and how long you've owned it. Although tax laws can be complex, understanding the basics of investments and tax laws can help you ...

    Mutual Fund Tax Rules

    Mutual funds are taxed in two ways – on capital gains and on dividends. Fund managers control the buying and selling of shares, so investors have little control over mutual fund taxation. To avoid paying corporate income tax, mutual funds pass along any excess capital ...

    How to Claim Investment Losses When You Sell Mutual Funds

    If you sold mutual fund shares at a loss, that loss is reported using the capital gains and losses section and forms of your Form 1040 tax return. Losses are reported for the year in which you sold the fund shares. The biggest challenge when reporting mutual fund sales is ...

    Tax Treatment of Stocks

    When you sell stocks you pay taxes on the gains, and you get to deduct the losses. How much you pay or write off depends on how long you have held the stocks. You divide your stock sales into long-term and short-term investments to list them in the proper categories on your tax ...

    Tax Implications for Capital Gains on Stocks

    Owning stocks offers you two ways to receive income -- by receiving dividends and by selling your stocks. Either way, you can be taxed. How much tax you pay, however, depends on several factors including how long you held the stocks. Depending on a number of factors, you may be ...

    How to Avoid Tax on Your Stock Market Profits

    You usually buy stock for one of two reasons. Either you are looking for a steady stream of dividend income, or you expect the market value of the stock to increase, providing you a capital gain. Any profit you make on your stocks is taxable as unearned income, and the Internal ...

    Taxes on Common Stock

    When you buy common stock, you're buying a tiny sliver of ownership in the company that issues the stock. Though it might feel good to think, "I own part of a company," most people invest to make money. Your taxable gains from common stock include both price increases ...

    How to Write Off Stock Market Losses

    The point of investing in the stock market is to make money, but that doesn't always happen. Stock prices can go down as well as up. If your stock market losses for the year exceed your gains, you can claim a tax deduction on the net capital loss.

    How to Report a Wash Sale on Schedule D

    A wash sale occurs when an investor sells a stock or security at a loss, then purchases the same substantially identical investment within 30 days or less. Under IRS rules, investors cannot deduct the loss, but they still must disclose it on Schedule D. The wash rule applies to ...

    Are Corporate Stocks Taxable?

    Corporate stock can produce income in two ways -- dividends while you own your stock and profit when you sell it. Since it is income, you must report it to the Internal Revenue Service, and the IRS can tax it. Two possible tax rates apply, depending on the circumstances -- ...

    Are Corporate Bonds Taxable?

    Corporations can sell bonds to investors as an alternative to other forms of financing like taking out loans or selling stock. When you buy a bond, you receive interest from the bond issuer until a maturity date; the issuer pays back the face value of the bond upon maturity. ...

    How to Declare Taxes on Stocks

    When you’re closing out a winning stock trade, the last thing on your mind is paying the taxman. But if your tax bracket is high and your gain small, that little profit could end up costing more in taxes than it made. Busy traders might want to check with their tax ...

    What Can I Offset With Mutual Fund Losses?

    Investing in a mutual fund can be less risky than buying individual securities. If you buy a stock mutual fund, for example, you will typically own an interest in hundreds of different stocks. The sheer diversity of your portfolio minimizes the damage that any one individual ...

    How to Sell Inherited Stocks

    Once you've inherited stock, you can sell it just like any other shares of stock. However, it gets complicated when trying to figure your capital gains on the sale. When you inherit stock, you get a step-up (or step-down) in basis to the fair market stock on the valuation date ...

    Rules for Capital Gains

    Investing in assets that can increase in value is a common strategy to build wealth, but the profits you make when you sell investments are subject to federal taxes. The profit you make when selling an asset at a price that is higher than what you paid is called a capital gain. ...

    How to Report Short Sale of Stock Not Closed Out by Year's End

    A short sale refers to borrowing stocks from another investor and selling them at prevailing prices. If the stock's price declines later, you can buy the same amount of shares back for less, return them to the investor and pocket a profit equal to the decline in the stock's ...

    How to Handle Restricted Stock 1099-B on a Tax Return

    Restricted stock cannot be sold until the limitation the company placed on it expires. Stock can be restricted for a number of reasons -- during a vesting period, for example, or until a goal is met, such as gross revenue meeting a specific threshold. Once the restriction is ...

    How to Report a Cashless Exercise on Schedule D

    When employees exercise their stock options, it creates a cashless event that needs to be reported on Internal Revenue Service Form Schedule D. The simultaneous purchase and sale of company stock may result in income that is categorized as compensation on the employee’s ...

    What Is a Mutual Fund Cost Basis Statement?

    When you sell mutual fund shares, the cost basis is used to calculate the amount of your capital gain or loss. The ability to reinvest mutual fund distributions makes calculating the cost basis a little trickier. Many mutual fund companies provide cost basis statements to ...

    What Does "Long Term Capital Loss" on Schedule D Mean?

    If you have gains or losses from your investments, those results are reported on Schedule D of your income tax return and the net results transferred to the Form 1040 tax return. The tax rules allow you to use investment losses to offset gains and reduce your total tax bill. ...

    Wash Sale Rules About Investments

    If you sell an investment at a loss, that loss -- called a capital loss -- can be used as a write-off on your taxes. But if you sell an investment to take a deductible loss and then buy the investment right back, the result is called a wash sale. Wash sale rules aim to prevent ...

    How to Report an ESPP on a Schedule D

    An Internal Revenue Service-approved employee stock purchase plan, or ESPP, provides favorable tax treatment to employees when they buy and sell company stock. Employees can sell their shares at any time, but they must meet two IRS conditions to retain the favorable tax ...

    IRS Rules on Carryover Loss Against Capital Gains

    Capital gains tax liability is triggered when you make a profit from the sale of a capital asset, which includes nearly every type of property except business inventory and accounts receivable. You incur a capital loss when you sell a capital asset at a loss. Fortunately, ...

    How to Report the Sale of Stock Call Options

    When you trade call options, the sale must be reported to the Internal Revenue Service. Unlike the way they do with stock trades, brokerage firms do not send you a Form 1099 reporting the basis of every option trade. Instead, you must use your brokerage statements to match up ...

    Capital Gains Implications of Family Law Settlements

    The Internal Revenue Service doesn't care if you take sole ownership of joint assets in a divorce settlement. Most transfers made according to a marital settlement agreement or decree are tax-free under the terms of Section 1041 of the Internal Revenue Code. Tax problems don't ...

    Are Capital Gains From Real Estate Part of My Income?

    If you buy a house or land and later sell your property for a profit, you've made a capital gain. Before rolling the money into a new investment or spending it, you have to consider the tax implications. You must declare the transaction to the Internal Revenue Service in the ...

    How to Report a Loss in a Mutual Fund

    If a mutual fund concentrates its holdings in a declining sector or industry, you might experience a paper loss. Since the loss is only on paper and not a real money loss, you do not report it to the Internal Revenue Service. But if you sell the fund shares at a loss, you have a ...

    When Does Inherited Stock Become Taxable?

    You are not liable for taxes on the inherited value of stocks you receive from someone who died. The estate of the deceased person takes care of any tax issues, and once you have received stock as part of an inheritance, the stock is yours without any taxes due. However, you can ...

    How to Sell Stock at a Loss

    Even the best investors don't pick winners every time. If you've bought stock that's declined in value and decided it's time to jump ship, timing the sale and reporting it properly on your taxes could help you offset some of the loss. You can use the losses to cancel out some or ...

    Are Capital Gains Passive Income?

    If you put food on the table by heading into a job and collecting a paycheck, most other means of generating income may seem so hands-off that they qualify as passive income. While this rule of thumb seems logical, it’s not accurate: The Internal Revenue Service strictly ...

    The Tax Implications of Trading Futures

    Futures traders qualify for certain tax breaks that simplify record-keeping and save money. The rules revolve around Section 1256 contracts as defined by the Internal Revenue Service. To qualify, a futures contract must be traded on an exchange approved by the Commodity Futures ...

    Can I File a Cashed Out UTMA on My Taxes?

    The Uniform Transfers to Minors Act allows an adult to give gifts such as shares of stock or mutual funds to a minor. Each year, the Internal Revenue Service taxes the capital gains from the UTMA, which is paid by the minor child if the gains exceed the standard deduction for a ...

    What Are the Benefits of Long-Term Capital Gains?

    The best benefit of a long-term capital gain is the gain itself -- it is always a positive outcome to generate a profit on one of your investments. The tax rules on capital gains are also set up to provide tax advantages for gains on investments held for the long term compared ...

    Tax Consequences of Selling Private Stock

    Corporations raise money through the sale of stock, offering investors an ownership stake in the company in exchange. Many large corporations sell their stock on public markets, such as the New York Stock Exchange. Cporations often remain privately owned because publicly traded ...

    Tax Breaks for Selling Property at a Loss

    Selling property at a loss can be a painful process. Depending on the state of your financing and the depth of your loss, you could end up owing additional money to the bank, or you could be selling under duress. While you may gain some benefit on the back end from selling an ...

    Tax Implications of Multiple Buying and Selling of the Same Stock

    A frequent trader, especial a day trader, may become familiar with certain stocks and trade them repeatedly over short periods. This kind of activity might be profitable but also faces unique obstacles. Rapid in-and-out trading of this type removes access to tax breaks for ...

    FIFO Method for Selling Mutual Funds

    When you sell mutual fund shares, you must claim the gain or loss you realized on those shares. The capital gain or loss is the difference between the selling price and your cost basis. The tax rules give you several ways to determine what those shares cost, including using a ...

    Are Military Personnel Exempt From Capital Gains?

    Some tax rules can create a unique prejudice against military personnel because service often involves a somewhat unorthodox way of life. This is particularly true where capital gains and real estate are concerned. If you serve in the military and can't meet certain rules to ...

    Gold ETF Taxation

    Gold ETFs make buying, selling and trading the precious metal as easy as trading stock shares. However, the tax ramifications of generating profits from a gold ETF are significantly different from the capital gains tax rates when investing in stocks and other securities. With a ...

    Cost Averaging vs. Cost Basis

    When you earn profits on your investments, the government wants its share and collects that money in the form of capital gains taxes. You pay taxes only on the gains, which are your selling price minus the cost basis. If you end up with several different costs on an investment ...

    Capital Gains Offsets With LLC Operating Losses

    When a limited liability company, or LLC, incorporates, the members must decide how the LLC will be taxed. An LLC with only one member is taxed as an individual. An LLC with two or more members can elect to be taxed as a partnership, a C corporation or an S corporation. The type ...

    Does Capital Gains Tax Include State Taxes?

    Just like regular income, you must usually pay taxes on capital gains – and often twice. The Internal Revenue Service wants a percentage of your profit, and most states do too. The state tax is in addition to the federal tax, not included in it.

    Do I Have to Pay Capital Gain Taxes If I Sell a Rental & Invest in a Principal Residence?

    Selling a rental property and buying a home may seem like the same thing. The properties are both real estate and the transactions must be conducted in accordance with existing real estate laws. However, for taxation purposes, the IRS considers rental property and a personal ...

    What Is the Capital Gains Tax on Gifted Property Sold in India?

    Capital gains on gifted property sold in India must be reported as income on your U.S. tax return, although you might be able to avoid paying the taxes thanks to a tax treaty between the two countries. When completing your U.S. tax return, you must calculate your capital gains ...

    Do You Need to Pay Capital Gains Tax on a Piece of Land That Was a Gift in Minnesota?

    It's an unfortunate fact of life that some gifts come with strings attached. Capital gains is never an issue if you hold on to a gift, using it for your own personal enjoyment. If you treat it as an investment and later sell it, however, both the Internal Revenue Service and the ...

    Are Stock Investments Tax Deferred?

    When you invest in stocks, the tax rules are separate and quite different from the regular income taxes you pay on your wages or salary. It is possible to defer taxes on some of your investment gains, and you may pay preferential tax rates on your investment profits. When ...

    What Happens When the Stock I Bought Has Less Value Than What I Paid for?

    Everyone wants to be the next Warren Buffet, but even the best investors end up with a few losing picks along the way. But, as long as you're still holding the stock, Uncle Sam doesn't want to hear about it on your taxes, because the value could still go back up. So, no matter ...

    How to Convert Rental Property to a Principal Residence for Capital Gains

    Selling your home is a much better tax deal than selling a rental house. When selling your rental, you pay tax on your gain -- roughly the difference between your purchase price and sales price. When it's your home, you can exclude $250,000 in gain from tax; married couples can ...

    How Soon Does Money From Selling a House Have to Be Invested So No Capital Gain Tax Is Paid?

    When you sell your primary personal residence, the home sale capital gain exclusion can eliminate or severely limit your capital gains tax liability. When you sell an investment home, though, the Internal Revenue Service hits you with both capital gains and depreciation ...

    Are Stock Commissions That Are Paid Tax Deductible on Your IRS Filing?

    The commissions that you pay when you buy and sell stock reduce your taxable income, but they aren't deductions in the same way as mortgage interest, state income taxes or charitable donations. Instead of being written off your income, they are added and subtracted from your ...

    Capital Gains Tax Laws for the State of Colorado

    Colorado bases state income tax on an individual's federal taxable income. The federal amount includes taxable capital gains, meaning you'll be paying both federal and state tax on a profit you earned selling property or an investment. To relieve state residents of this double ...

    How Much Tax Do You Pay on Call Option Gains?

    Most profits from trading call options are short-term capital gains, on which you pay your marginal tax rate. In some circumstances, a call will lead to a long-term capital gain. When you buy a call, you have the right to buy some amount of an underlying asset for a ...

    The Tax Policy on Options Trading on a Loss

    It's easy to lose money on options -- people do it every day. Calls and puts give buyers the right to purchase or sell, respectively, an underlying asset at a specified price -- the strike price -- on or before an expiration date. An option seller collects a premium and must ...

    What Are IRS Reporting Rules About Sale of Gold Coins?

    There is no one standard way of reporting the sale of gold coins on your tax return. How you report the sale and any possible tax owed depends on your specific circumstances. The tax rules are different for people who regularly sell gold coins with the intent of earning profits, ...

    How to Avoid Mutual Fund Capital Gains

    Successful investing often brings the unfortunate byproduct of taxes. When you take a gain, you have to report it to the Internal Revenue Service. Unless you're in the lowest tax bracket, you'll have to pay at least some tax on your profits, sometimes at a significant rate. This ...

    How to Sell Mutual Funds Before Capital Gains Distribution

    Investment decisions, particularly regarding long-term investments such as mutual funds, shouldn't be dictated solely be tax consequences. However, there may be instances in which you'd prefer to avoid a taxable capital gains distribution from your fund. Since these payouts are ...

    Do I Have to Report a Capital Gains Distribution if the Money Was Reinvested?

    Mutual funds are required to pass along to investors the gains realized from trading securities. The distributions paid can be automatically reinvested into more shares. However, the capital gains distributions your fund account earned must be reported on your taxes, whether you ...

    The Tax Implications of Selling Mutual Funds & Buying New Mutual Funds

    When you sell mutual fund shares, you trigger a tax event -- a capital gain or loss. Using the sale proceeds to buy shares in a different mutual fund does not affect your tax situation from the sale of shares. You can defer or escape the tax implications of mutual fund trades by ...

    Tax Credit for Investment Losses

    There are few good things about investment losses, but one positive is that you can write off losses on your income taxes. The negative results from your bad investments can be used to reduce the taxes on your investments that made money or even used to reduce your taxable ...

    What Tax Do I Need to Pay on Stocks Bought Online?

    Online stock trading is a popular financial tool for individual investors. The Internal Revenue Service does not generally tax online stock transactions differently than those made through traditional brokerage houses. Online brokers, like traditional brokers, report stock sales ...

    Tax Basis for Stocks Acquired in a Series

    The Internal Revenue Service treats corporate stock investments as capital assets. Whenever you sell shares of stock, the resulting gain or loss is reportable on your tax return. Calculating the gain or loss initially requires that you identify the tax basis of each share sold. ...

    How to Sell Rental Property and Not Pay Capital Gains

    A problem with doing well with an investment is that the Internal Revenue Service is usually waiting with its hand out at the end of the transaction, expecting its share in taxes. Capital gains taxes come due when you sell an asset for more than the money you have invested in ...

    How to Calculate the Taxes on the Sale of Tax-Exempt Bond Funds

    Bond funds are portfolios of bonds available as mutual funds or exchange-traded funds. The dividends provided stem from the interest the fund earns. A tax-exempt bond fund contains tax-free municipal bonds issued by state and local entities. Depending on where you live, some of ...

    Do You Have to Claim Stocks You Sold in a Year if You Didn't Make Any Money?

    Even though you did not make any money on stocks you sold, the IRS doesn't know that. Your broker will report the sales to the tax agency, so you need to complete the right forms for your taxes to show that those sales produced no profits. Also, if you lost money on your stocks, ...

    Harvesting Long-Term Capital Losses

    When you have a profit in the stock market, you're not the only winner. The Internal Revenue Service also gets to collect a portion of what you made from your asset's appreciation through the capital gains tax. However, they also let you subtract your losses from your gains to ...

    Income Tax: How to Figure the Price of Stock Sold

    Whether you're a day trader or are selling shares you've held for years, it feels great to make a profit when you sell your stock. However, you won't be the only one enjoying the proceeds, because the Internal Revenue Service counts the profits as taxable income. To figure out ...

    What Characterizes a Capital Loss?

    According to the Internal Revenue Service, anything you own and use for personal or investment purposes counts as a capital asset -- from your stocks to your house and car to that new washer and dryer you bought last week. For tax purposes, a capital loss occurs when you sell ...

    Is It Ever Good to Buy Mutual Fund Shares Before a Distribution?

    The rule of thumb is not to buy mutual fund shares just before a distribution. The reason is to avoid paying taxes on gains you have not really earned but the tax rules make you pay anyway. There may be few reasons to invest before a distribution, but there are several ...

    Definition of Post-Split Adjusted Basis

    Waking up to see you own twice as many shares because of a stock split is thrilling until you realize you're no richer because each share is worth half as much. Though stock splits are more about keeping the price of a stock in a target trading range, they do impact how you ...

    What Are You Required to Pay Capital Gains Tax On?

    You're required to pay capital gains taxes any time you sell capital assets for a profit. Capital assets include anything you own and use for personal or investment purposes, such as your car or stocks. Any capital gains must be reported on your federal income taxes. To do this, ...

    What Is Unrecaptured 1250 Gain?

    When you sell an asset, there are two types of gains that the Internal Revenue Service can use to charge you tax. Capital gains occur when you sell an asset for more than you paid for it. When you own a depreciable real estate asset, like a rental house, you can also be subject ...

    Taxes on Trading Capital Assets

    Though people commonly think of investments as capital assets, the term includes personal property as well, such as a house, a boat and likely even the computer you're reading this on. Any time you trade a capital asset for a profit, you have a capital gain that you have to ...

    How to Calculate & Report Your Capital Gains & Losses

    Income from selling capital assets, like stocks, mutual funds or property, must be included on your taxes like income from working. However, instead of paying taxes on the entirety of the sales price, you must calculate your capital gains. In addition, it takes more time and tax ...

    How to Determine Which Shares to Sell, FIFO or LIFO

    When you've been investing for a long time, chances are there are at least a few companies whose stock you've bought on multiple occasions and at different prices. When you sell some of your shares, picking which shares you want to sell can make a significant difference in how ...

    How Are Taxes Calculated on a Brokerage Account if I Withdraw?

    Brokerage accounts are merely conduits for holding your investments, not investments in and of themselves. As a result, simply withdrawing cash from your brokerage account won't cause your tax bill to go up. However, if you're selling assets in the account to free up cash to ...

    What Taxes Do I Have to Pay When I Sell Rental Income Property?

    Rental property is considered a business asset, and a sale of the property will result in a gain or loss. Tax is due only on any gain, and you can write off a loss on rental property to offset taxable income. The key factor is correctly calculating the amount of gain or loss on ...

    Can I Use the Average Cost Basis When Selling Stocks?

    Determining your taxable gain requires subtracting the adjusted basis of the stocks you sold from how much you got from the sale after commissions and fees. The fluctuations in stock prices creates several complications in tracking your basis in investments, especially because ...

    Tax Consequences of Purchasing Stock Below Fair Market Value

    Purchasing stocks for less than their fair market value may be a wise investment, especially if other buyers are willing to pay more than you did. If you're concerned about the tax consequences of your stock purchase, you'll be happy to know that no tax is potentially due until ...

    Short Sell LEAPS and Taxes

    Long Term Equity Anticipation Securities is the fancy name for put and call options with terms that last for up to three years compared to the typical options that expire in nine months or less. You can sell a LEAPS contract, pocket the premium earned and keep the money as a ...

    How Is an Investment Club Member's Tax Basis Determined?

    Amateur investors often participate in groups called investment clubs. Investment clubs allow the group to pool funds to make larger investments than each member could individually, and earnings are then passed along to each member. Most investment clubs operate as partnerships ...

    Can You Sell Stock to a Relative & Still Write it Off on Your Taxes?

    Selling stocks that are currently worth less than you paid for them generally allows you to write off the loss on your taxes. But if the buyer of the stock is one of your relatives, the Internal Revenue Service may disallow the capital loss write-off because of the ...

    How to Sell an Inherited Mutual Fund

    If you inherit an investment such as mutual fund shares, the securities or shares are yours to do with as you wish. Fortunately, the tax rules give benefits to inherited property, so you will not face a big tax bill if you choose to sell fund shares soon after you have received ...

    How to Roll a Capital Gain Into a Roth

    If you sell an investment for more than its purchase price, you have a capital gain. Unless the gain is in a tax-sheltered account, you’ll have to pay capital gains tax. If you’d like to contribute an unsheltered gain to a Roth individual retirement account, ...

    How to Pay Capital Gains Taxes on Custodial Accounts

    Custodial accounts such as those arranged under the Uniform Transfers or Gifts to Minors Acts exist in a state of partial legal limbo. While UGMA/UTMA accounts are the property of the named minor, the custodian is responsible for managing them. These responsibilities include ...

    Capital Loss Taxes for Municipal Bonds

    Municipal bonds aren't always tax-free. While the interest income you earn from tax-free municipal bonds isn't subject to federal tax and is also exempt from state tax if you buy a bond from a state where you reside, the Internal Revenue Services treats your proceeds from ...

    Does the Seller Have to Pay Tax on a Vehicle When He Sells It?

    Given that most of the property you own, like your home and vehicles, are capital assets, it's difficult to sell anything at a profit without having to report it on your tax return. When a person sells a new or used vehicle that cost him less than it sold for, he may not get to ...

    Capital Gains Tax on a House Sold From a Trust

    Suppose you created a trust and placed your house in the trust. If you control the trust and the property in the trust, and you retain power such as the ability to amend, revoke or terminate the trust, the Internal Revenue Service will likely regard the trust as a grantor trust ...

    Is the Sale of Farm Land Capital Gain or Ordinary Income?

    When you sell farmland, any profit you make on the sale is a capital gain. You pay capital gains tax rather than ordinary income tax on the sale, which usually works out the same or better for your bottom line. If you lose money on the sale, then you can write it off as a ...

    Does a Stock Beneficiary Have to Reinvest?

    When someone inherits property such as stock shares, the shares are then owned by the beneficiary to do with as she wants. If the shares were in a dividend reinvestment plan, the disposition of the dividends can be changed. There are significant tax advantages to inherited ...

    Is the Total Mortgage Amount Paid for the Property the Cost Basis?

    When you obtain a mortgage to purchase real property, it's likely that the total loan amount accounts for a large portion of your tax, or cost, basis. This is true for a property you acquire for investment purposes as well as the home you live in with your family. But aside from ...

    Does Depreciation Offset Capital Gains?

    Depreciation is a benefit at the time you claim it, as it reduces your income and the associated taxes that you pay. But it causes real headaches when you sell the property. All of the depreciation that you claim over the years affects the actual capital gain on the property and ...

    Taxes on a Return of an Initial Investment

    Most of the investments you purchase are taxed under the capital asset rules. This means that receiving a return of your initial investment -- which commonly occurs through a sale -- has different tax implications than those that result when you receive investment gains. For ...

    Is Options Trading Reported to IRS?

    Like options-trading strategies, the tax treatment of options trades is far from simple. Under new broker reporting requirements, options transactions are now reported to the Internal Revenue Service when you close the position, including your cost basis and capital gain or ...

    How Do I Determine the Value of My Transferred Stock for Tax Deductions?

    Determining the value of transferred stock for the purpose of figuring out your tax deduction depends on whether you sell the shares at a loss or donate them to a tax-exempt charity. Although the capital loss and charitable deduction rules are similar, slight differences exist ...

    The Tax Loss for Selling Unlisted Stocks

    Whether you're selling publicly traded or unlisted stocks, the tax implications of selling them at a loss are generally the same. In both cases, you'll have a capital loss that can offset your capital gains, be deducted -- or both. If, however, you own more than half of the ...

    Can Section 1256 Losses Offset Schedule D Capital Gains?

    The Internal Revenue Code establishes a unique treatment for some contracts, such as regulated futures contracts, that fall under the terms of Section 1256. At the end of each year, a taxpayer must report any change in the contract’s fair value as if the contract were ...

    How Much Stock Can You Sell Without Filing It on Your Federal Income Tax?

    If you sell some shares of stock you own, you must report the results of the transaction on your tax return. It does not matter if you had a gain or a loss or only sold one share; you must complete the capital gains reporting forms to be attached to your tax return. The tax ...

    Receiving an Annuity As a Payment for Real Estate

    An annuity offers a secure payment stream over the remainder of your life or a shorter period of your choosing. While annuities are more commonly employed as tax-advantaged savings vehicles, people can offer them in exchange for real estate. Receiving an annuity as payment for ...

    Are Gains From a Warrant Derivative Liability Taxed?

    The tax code provides very general rules for the tax treatment that applies to different investments. As bankers and investors come up with more complex forms of investments, they enter new territory in determining what sections of the law govern the transaction. Warrants are ...

    How to Account for Equity When No Stock Is Issued

    At base, calculating your equity in a privately held company is a simple matter: You add up the firm's assets, subtract the liabilities, then multiply what's left by the percentage of the company you own. But if you know how to do all that, you're probably an accountant. Lesser ...

    Are Federal Taxes Due When Selling Unpatented Mining Claims?

    An unpatented mining claim conveys a limited set of rights. You don't own the land, but you own the rights to what is under it. Those rights give you a real estate interest, even though you technically aren't able to build on the land or live on it like you would with a patented ...

    Income Tax Treatments for Restricted Stock & Deferred Stock

    Stock grants are often subject to a vesting period. For example, you might grant shares that vest 25 percent per year or that only vest if the company meets its profit goals. At the time the employee receives the stock and can convert it into cash by selling it, the employee ...

    Tax on Quitclaim of Principal Residence

    A quitclaim deed might be a way to pass your principal residence to another person without any tax consequences. However, it might also result in a higher tax bill than if you disposed of it in a different manner. To understand the tax consequences, it's necessary to be aware of ...

    Stock Options & The Basis of Added Shares

    Shares of stock you hold for investment purposes are taxed under the capital gain and loss rules when they're sold. You can't calculate your gain or loss unless you know what your tax basis -- cost of acquiring the stock -- in the shares is. But if you purchased additional ...

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