What is the rate of long terms capital gains on stocks. What did it use to be and when did it change. I think it is now a little lower.
2007-09-21 14:05:02 · 5 answers · asked by VH 2 in Business & Finance ➔ Investing
Congress just loves screwing around with the tax rates and rules. I am not sure how many times they have changed these over the years. But the significant changes as I recall them are changing the holding period from 6 months to a year and changing the tax rate from 1/2 the normal tax rate to the convoluted scheme that they have now which also has been change a couple of times if I am not mistaken. There are basically 4 different rates that apply based on your income. Assuming married filing jointly, if you are in the lowest tax bracket with adjusted gross of about $61,000 the rate is 5%. From about 61,000 to about 124,000 the rate is 15%. From 124,000 to about 189,000 the rate is about 25%. Above that 28%. Since the highest rate is 35% on regular income the capital gains rate in that bracket is actually higher than under the 1/2 rule. But is the lowest bracket it is 5% vs 15% so it is 1/3. So depending on your bracket you are either getting a better deal or a not so good deal. But one thing is for certain. It is almost impossible now to figure out what you owe for capitial gains tax. It is especially confusing if your capital gains drives you into a higher bracket. That way some is taxed on one rate and some at another. In fact it is entirely possible to have the capital gains taxed at 4 different rates.
One thing I really love about the capital tax is that there is no allowance for inflation so if you hold an asset for 20 years, the asset is actually worth about 1/2 the value in dollars of 20 years ago, but you get taxed on the whole amount. So in effect you are actually being taxed at more than the full tax rate on long term held assets. I love our government. Bend over and grab your ankles.
2007-09-21 14:38:30 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Depends on Your total income .
But if the equity was held for over a year before the sale ,
Then it qualifies for the rate lower than short term .
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2007-09-21 14:10:13 · answer #2 · answered by kate 7 · 0⤊ 0⤋
I'm not sure what it is, but it's nowhere near enough to justify the risk of holding onto stocks that have become albatrosses just to shave something off your taxes. Any trading strategy that gives tax considerations more weight than sound decision-making is a sure loser.
2007-09-21 14:11:44 · answer #3 · answered by Anonymous · 0⤊ 0⤋
What rate are you talking about? Tax rate?
2007-09-21 14:09:36 · answer #4 · answered by Yardbird 5 · 0⤊ 0⤋
hi hi hi hi hi
2007-09-21 14:08:40 · answer #5 · answered by NONAME 1 · 0⤊ 2⤋