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 ?
Crucially, while tax competition keeps capital income tax rates down in all periods, accumulation implies a higher second period capital tax base in all countries.
The period-t capital tax is denoted by a flat rate [[tau].
This supports the hypothesis that a country's position in the economic cycle does not influence the relationship between the effective tax rate on capital and the capital tax quota.
Some jurisdictions may be characterized by the assumptions underlying the benefit view and others by those supporting the capital tax view.
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The last term confirms that tax revenue resulting from the capital tax imposed by region i on foreign investment, which is returned in a lump sum manner to the representative agent.
When capital income tax rates are restricted to be at most 100 percent, Chari, Christiano, and Kehoe (1994) show that it is optimal to set tax rates at their upper limit for a finite number of periods, after which the capital tax rate takes on an intermediate value and is zero, thereafter.
We also advised on an innovative company structure, that fits in with its commercial objectives, while at the same time allowing the business and its investors to benefit from the government's venture capital tax reliefs.
For tax years beginning after 2004, the State Budget for Fiscal Year 2006 (A 6845/S 3671, Laws 2005) increased the maximum amount of the alternative capital tax base from $350,000 to $1 million for nonmanufacturing taxpayers.
According to the company, the firm opinion of Raisio is that the sales profit is free of tax due to the corporate and capital tax approved in 2004.
Yang considers the consequences of bond-financed tax reductions that bring forth adjustments in expected future government consumption, capital tax rates, or labor tax rates.