U.S. capital gains tax on foreign stock sales...?

Question

I have shares of an Australian pharmaceutical company that I purchased in 2002. The shares have increased significantly in value, and I am ready to sell them. Unfortunately, I am uncertain of the tax consequences.

Would the capital gains be taxed at the long-term tax rate of 15% like a domestic stock? Will the gains be taxed at my regular income rate? Or, is there a special tax for foreign investments? I have searched the Internet and the tax guides at my local bookstore, but I cannot find a definitive answer. Any help would be greatly appreciated.

Answer 1

it makes no difference what country the capital gains come from. tax would be the same as if the stock was from a U.S. company.
Stocks held 5 yrs or longer would be taxed at a lower rate, starting at 5% if you are in lowest tax bracket.

Answer 2

In the year 2007 long term capital gain rate in US is 5% if you are in the 15% bracket; and after 2007 the rate drops to 0%. Sell this year and pay 5% or wait until 2008 and pay 0%; unless the bottom falls out before 2008. Your choice.

Answer 3

once you flow a inventory that has won fee (to illustrate, a inventory that to procure for $500 and that's nicely worth $1500 once you flow it), you need to pay tax on the convenience in fee, regardless of in case you at the instant are not paid for the inventory. consequently, your plan won't artwork. The broking provider is likewise incorrect. below U.S. tax regulation, being "the secondary" does not shrink your tax criminal duty. you need to pay tax on the income on any investment which you own, in spite of which guy or woman is indexed first on the account place of work work. to illustrate in case you're each and each 50% area vendors in the joint account, then you fairly ought to pay tax on 50% of the money. that is not stricken by who's "prevalent" and who's "secondary".