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Short-Term Capital Gain |
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Short-term capital gain A profit on the sale of a security or mutual fund share that has been held for one year or less. A short-term capital gain is taxed as ordinary income. Short-Term Capital Gain The gain one realizes by closing a position one has held for less than one year. For example, if one buys a stock or bond and sells it five months later for more than what one paid, the gain is considered a short-term capital gain. The government wishes to encourage long-term investment and, as such, short-term capital gains are usually not entitled to preferential treatment for tax purposes; that is, they are taxed at a higher rate than gains from long-term investments. See also: Short-term capital loss. Want to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit the webmaster's page for free fun content. |
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