capital gain

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Related to Capital gains: capital gains tax

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 ?
To contribute to the economic boom and qualify for the tax deferment incentive, investors must place the unrealized capital gains in a Qualified Opportunity Funds (QOF).
Fred then invests his XYZ stock capital gain in Wilma's LLC and timely elects to defer the capital gain.
It may seem odd, but the income ranges long-term capital gains tax brackets look rather different than those for ordinary income and short-term gains.
"Kiddie tax." For children subject to the kiddie tax, the taxable income breakpoints for trusts and estates governs whether they pay 0%, 15%, or 20% on their long-term capital gains [Internal Revenue Code (IRC) section l(j)(4)].
* Capital gain rate differential adjustment, which reduces all or a portion of foreign capital gains and losses via multiplication by certain percentages to adjust for the differences between the various capital gains tax rates and the ordinary income tax rate.
And now, many investors are sitting on significant embedded capital gains. After the downturn of late 2008 and early 2009, investors had little reason to worry about capital gains on Tax Day.
Ed Garner of Maumelle sponsored a capital gains tax reduction (HB 1947) that passed the House with 29 Republican and 27 Democratic votes.
Short- term capital gains are taxed at the income tax rate of individuals.
"In cases where the property has been inherited, the cost to the original owner will be considered as the cost of acquisition for computing capital gains. If the property has been acquired prior to 1 April 1981, the acquisition cost will be the cost incurred by the original owner or the fair market value of the property as on 1 April 1981, whichever is higher," says Sirwalla of KPMG.
Presently, Taiwan levies capital gains tax for securities mainly via the minimum tax burden mechanism.
"A high capital gains tax rate, as we have in Oregon, discourages people from investing and encourages current investors to hold onto their assets," said House Republican Leader Kevin Cameron, R-Salem.
For investors holding these assets, future capital gains tax increase, could affect future appreciation.