capital gain

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Capital gain

When a stock is sold for a profit, the capital gain is the difference between the net sales price of the securities and their net cost, or original basis. If a stock is sold below cost, the difference is a capital loss.

Capital Gain

In real estate and investments, the difference between the purchase price and the sale price when the sale price is more. That is, when an investor buys a security or real estate and sells it for a higher price, he/she incurs a capital gain. Capital gains in the United States are taxed at a lower rate than other income if the asset is held for longer than one year. One may use capital losses to offset capital gains to minimize one's liability for capital gains taxes; indeed, some investors do so deliberately. See also: Paper gain.

capital gain

The amount by which proceeds from the sale of a capital asset exceed the cost basis.

Capital gain.

When you sell an asset at a higher price than you paid for it, the difference is your capital gain. For example, if you buy 100 shares of stock for $20 a share and sell them for $30 a share, you realize a capital gain of $10 a share, or $1,000 in total.

If you own the stock for more than a year before selling it, you have a long-term capital gain. If you hold the stock for less than a year, you have a short-term capital gain.

Most long-term capital gains are taxed at a lower rate than your other income while short-term gains are taxed at your regular rate. There are some exceptions, such as gains on collectibles, which are taxed at 28%. The long-term capital gains tax rates are 15% for anyone whose marginal federal tax rate is 25% or higher, and 5% for anyone whose marginal rate is 10% or 15%.

You are exempt from paying 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 gain

the surplus realized when an ASSET (house, SHARE, etc.) is sold at a higher price than was originally paid for it. However, because of INFLATION it is important to distinguish between NOMINAL VALUES and REAL VALUES. Thus what appears to be a large nominal gain may, after allowing for the effects of inflation, turn out to be a very small real gain. Furthermore, in an ongoing business, provision has to be made for the REPLACEMENT COST of assets, which can be much higher than the HISTORIC COST of these assets being sold. See CAPITAL GAINS TAX, CAPITAL LOSS, REVALUATION PROVISION, APPRECIATION, definition 1.

capital gain

the surplus realized when an ASSET (house, SHARE, etc.) is sold at a higher price than was originally paid for it. Because of INFLATION, however, it is important to distinguish between NOMINAL VALUES and REAL VALUES. Thus what appears to be a large nominal gain may, after allowing for the effects of inflation, turn out to be a very small real gain. Furthermore, in an ongoing business, provision has to be made for the REPLACEMENT COST of assets, which can be much higher than the HISTORIC COST of the assets being sold. See CAPITAL GAINS TAX, CAPITAL LOSS, REVALUATION PROVISION, APPRECIATION 2.

capital gain

The taxable gain recognized from the sale of a capital asset. It is the difference between the sale price of the property and the adjusted basis.Tax laws routinely offer preferential treatment for long-term capital gains on property held for a certain period of time before sale. Capital gains may be offset by capital losses.

Capital Gain

The gain from the sale or exchange of a capital asset.
References in periodicals archive ?
68 (sixty- eight cents) and an annual distribution from realized capital gains in the amount of $1.
The practice also is concerned that the effective date of capital gains reform only will be retroactive to January 1, 1996, not January 1, 1995 as many had hoped.
If you buy shares right before the distribution, you will be taxed on a year's worth of capital gains even though you've only held the shares for a short time and did not participate in any gains during the year.
3) The recipients of these and other damage awards must determine whether to report the amounts received as ordinary income, capital gain, non-taxable restorations of capital or fully taxed punitive damages on their returns.
Most Republicans want to slash the top capital gains rate of 28 percent on all profits, arguing that such a reduction would unleash new investment and create jobs and economic growth.
13 (thirteen cents) per share and an annual distribution from realized long-term capital gains in the amount of $0.
The Taxpayer Relief Act of 1997 amended Internal Revenue Code section 1 (h) to provide for new capital gains rates for individual taxpayers.
Instead of paying a higher tax rate on the short-term capital gains dividend distribution, you can pay 28% on your longterm capital gains.
FC's pre-acquisition earnings and profits are, thus, essentially taxed twice (once as capital gain to the selling partners and again as a QEF inclusion to the new partners).
A proposal by the Clinton administration made during the presidential campaign to remove the capital gains tax on the sale of a residence is widely thought to be almost meaningless in most markets in the U.
The IRS later acquiesced in Eisenberg (see IRB 1999-4, 4); it agreed that the FMV can be reduced, for estate or gift tax purposes, by the potential capital gains tax liability.