Capital Gains Treatment

Capital Gains Treatment

How a government taxes capital gains, which are gains from investing in securities and other investment vehicles. In the United States, capital gains treatment is divided into short term and long term categories. The IRS taxes long term capital gains at a much lower rate (a maximum of 15% as of 2009) than short term gains (a maximum of 35%, which is identical to the highest income tax bracket). This is done in order to encourage long-term investing while discouraging (or at least not encouraging) short-term or speculative investing. In practice, accountants and investors have developed a variety of ways to attain long term capital gains treatment.
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In order to receive long-term capital gains treatment, the shares must be held for at least one year following the date the stock was transferred.
Capital gains treatment begins at the time of grant and not at vesting.
Thus, a seller would generally prefer capital gains treatment.
the fund manager would receive capital gains treatment on any change in
The Funds will be closed to address changes announced in the 2013 Federal Budget that included provisions to eliminate the tax benefits associated with forward agreements used by certain investment funds to achieve capital gains treatment on investment returns that would otherwise be treated as income for tax purposes.
It is important that the tax code continue to recognize their ownership status and offer these investors and entrepreneurs the same capital gains treatment available to owners of other types of businesses.
However, gold ETFs qualify for long-term capital gains treatment after being held for just one year.
The issue of the special capital gains treatment of carried interest -- performance fee income for investment managers -- is only the tip of a very large iceberg.
The strategy will also preserve the coveted capital gains treatment to be realized from a sale and avoid the ordinary income that could arise from debt forgiveness.
If that were not so, there could be virtually no circumstances that qualify for capital gains treatment.
The loss of capital gains treatment for real estate investment ownership would turn long established buy-and-hold procedures upside down.
One of the key benefits to co-op conversions is that the landlord can obtain capital gains treatment and can convey the property to the apartment corporation using a 1031 exchange, thereby deferring the income taxes on the conveyance.