Thursday, November 1, 2012

Capital gains tax in the United States - Wikipedia, the free encyclopedia

Capital gains tax in the United States - Wikipedia, the free encyclopedia:

In the United States of America, individuals and corporations payincome tax on the net total of all their capital gains just as they do on other sorts of income. "Long term" capital gains are generally taxed at a preferential rate in comparison to ordinary income (26 U.S.C. §1(h)). The amount an investor is taxed depends on both his or her tax bracket, and the amount of time the investment was held before being sold. Short-term capital gains are taxed at the investor's ordinary income tax rate and are defined as investments held for a year or less before being sold. Long-term capital gains, which are gains on dispositions of assets held for more than one year, are taxed at a lower rate than short-term gains. In 2003, this rate was reduced to 15%, and to 5% for individuals in the lowest two income tax brackets. The reduced 15% tax rate on qualified dividends and long term capital gains, previously scheduled to expire in 2008, was extended through 2010 as a result of the Tax Increase Prevention and Reconciliation Act of 2005 signed into law by President George W. Bush. This was extended through 2012 in legislation passed by Congress and signed by President Barack Obama on Dec 17, 2010. As a result:
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