capital gains tax

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Capital gains tax

The tax levied on profits from the sale of capital assets. A long-term capital gain, which is achieved once an asset is held for at least 12 months, is taxed at a maximum rate of 20% (taxpayers in 28% tax bracket) and 10% (taxpayers in 15% tax bracket). Assets held for less than 12 months are taxed at regular income tax levels, and, since January 1, 2000, assets held for at least five years are taxed at 18% and 8%.

Capital Gains Tax

The tax paid on profits realized by selling a position held for longer than one year. For example, if someone buys a stock or bond and sells it five years later for more than what he/she paid, that person is assessed the capital gains tax. In the United States, capital gains taxes are lower than regular income taxes. This is because the government wishes to encourage long-term investment. It is important to note that the capital gains tax is only assessed on long-term capital gains, not on short-term capital gains. See also: Long-term capital loss.

capital gains tax

The tax applicable to gains realized from the sale of capital assets, including stocks and bonds. The capital gains tax rate and holding period requirements are periodically changed by Congress. A favorable tax rate is generally applied to realized gains on assets that are sold following a holding period of over one year. Realized capital gains on assets held a year or less do not generally receive favorable tax treatment.

Capital gains tax (CGT).

A capital gains tax is due on profits you realize on the sale of a capital asset, such as stock, bonds, or real estate.

Long-term gains, on assets you own more than a year, are taxed at a lower rate than ordinary income while short-term gains are taxed at your regular rate.

The long-term capital gains tax rates on most investments is 15% for anyone whose marginal federal tax rate is 25% or higher, and 5% for anyone whose marginal rate is 10% or 15%. There are some exceptions. For example, long-term gains on collectibles are taxed at 28%.

You are exempt from capital gains tax on profits of up to $250,000 on the sale of your primary home if you're single and up to $500,000 if you're married and file a joint return, provided you meet the requirements for this exemption.

capital gains tax

a TAX on the surplus obtained from the sale of an ASSET for more than was originally paid for it.

In the UK, CAPITAL GAINS tax for business assets is based (as at 2005/06) on a sliding scale, from 40% on gains from assets held for under one year to 10% on gains realised after 4 years. For persons, capital gains on ‘chargeable'assets (e.g. shares) up to £8,500 per year are exempt from tax; above this they are taxed at 40%.

capital gains tax

a TAX on the surplus obtained from the sale of an ASSET for more than was originally paid for it. In the UK, CAPITAL GAINS tax for business assets is based (as at 2005/06) on a sliding scale, falling from 40% on gains from assets held for under one year to 10% on gains realised after four years. For persons, capital gains on chargeable’ assets (e.g. shares) up to £8,500 per year are exempt from tax; above this they are taxed at 40%.
References in periodicals archive ?
By continuing to exchange like-kind property, a property owner may conceivably defer capital gains taxes throughout their lifetime, regardless of how much their property appreciates in value.
To the extent that the Bush tax cuts are allowed to remain in effect and Obamacare is not repealed, capital gains taxes will escalate to 18.
Democratic committee members seemed unconvinced that lowering capital gains taxes would necessarily turn the state into a wealth magnet.
Almost no countries apply capital gains taxes to owner-occupied housing, for a variety of economic and political reasons.
Thus, it is an empirical question whether changes in capital gains taxes affect share prices.
The combination of low holding taxes and high capital gains taxes creates perverse incentives.
The conservation easement decreased his capital gains taxes brought by the Des Moines sale by $25,000 in the first year alone.
The taxpayers in all of these cases requested a reduction in stock value equal to the full amount of the capital gains taxes that would have been due upon liquidation of the respective corporations.
We know that capital gains taxes have been reduced, but there is disagreement, even among experts, as to how much.
Capital gains taxes affect investment decisions and can reduce the amount of capital available for higher risk potential.
If the same couple donated $10,000 worth of appreciated securities that had a cost basis of $2,000, their "cost" of the gift would still be only $7,200, but because donations of appreciated securities are deductible at their full fair-market value without accruing any capital gains taxes, the couple would also have avoided paying capital gains taxes on the stock's $8,000 appreciation.
The March Group, a leading, private mergers and acquisitions firm specializing in the sale of middle-market companies, is advising business owners who are planning to sell their companies to do so before 2011, when capital gains taxes will rise significantly.