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 ?
At the initial equilibrium, capital taxes are present in all sectors of the Canadian and US economies, but characterized by a larger magnitude in the Finance & Insurance and Services & Retailing sectors in both countries.
Even in the absence of an instrument that allows government lending to households, we saw in the previous section that the optimal fiscal policy with commitment prescribes zero capital taxes in the long run.
By contrast in this year 2000, we estimate to raise not pounds 36m but pounds 536m in capital taxes, and about pounds 3 billion in corporation tax, moreover at a much reduced rate.
The foregoing analysis on international capital competition and environmental standards was carried out under the assumption that foreign investors pay capital taxes to the home country, and the amount of taxes paid cannot be deducted from the tax liability in the source foreign country.
Once tax policies are fully implemented, Ontario will have a marginal effective tax rate for non-resource industries that is comparable to, although slightly higher than, Alberta's, which has no sales or capital taxes and a corporate rate of 10 percent.
Over the last decade rising property prices have meant many more people are attracting the attention of the Capital Taxes Office.
This is especially true of reductions in labor and capital taxes which provide much smaller welfare benefits in the short-run because of the initial reductions in consumption and leisure that are needed to generate increases in the physical and human capital stock.
Recently, Bond and Samuelson |4~ using a game theoretic approach in a one-commodity two-country model, examine the welfare effects of capital taxes under a system of capital tax credits and of capital tax deductions.
Forward-looking statements in this press release include, but are not limited to, production volumes, operating costs, commodity prices, administrative costs, commodity price risk management activity, acquisitions and dispositions, capital spending, distributions, access to credit facilities, capital taxes, Funds Flow From Operations and regulatory changes.
Capital taxes are particularly harmful in that they are due, whether or not a business is profitable.
Services for private clients involve personal tax planning, including capital taxes and inheritance tax, financial services advice and personal insolvency.
Finance Minister Flaherty observed recently that "Canada stands out as one of four OECD countries that still impose capital taxes and one of three that impose retail sales taxes on investment.