Not accurate:
1) Long Term Capital Gains - must hold UNVC for 1 year + 1 day. This has a max tax rate of 20%
2) Short Term Capital Gains = hold UNVC for less than 1 year + 1 day. This has a max tax rate of 37%
When you sell Long Term shares, they become part of income - however they have a Tax Rate Limit.
If you have 30k income and sell UNVC for 100k profit and have held the UNVC shares for 1 year + 1day = 15% tax on $100,000 profit ($15,000) + there will be tax if any on the 30k income. (+ any state tax if applicable).
If we sell UNVC for 1 million dollar profit and have held for 1 year + 1 day, then then Fed Income Tax = $200,000 (20%) and then there is state tax and in California that = another 14% = $140,000 and hence we take home $660,000 (66%).
Each State has its own tax rate.
For the IRS, all Capital Gains is calculated on Schedule D and then ends up on Form 1040.
For Short Term Capital Gains - we always pay a higher rate.
Hope this helps.
1) Long Term Capital Gains - must hold UNVC for 1 year + 1 day. This has a max tax rate of 20%
2) Short Term Capital Gains = hold UNVC for less than 1 year + 1 day. This has a max tax rate of 37%
When you sell Long Term shares, they become part of income - however they have a Tax Rate Limit.
If you have 30k income and sell UNVC for 100k profit and have held the UNVC shares for 1 year + 1day = 15% tax on $100,000 profit ($15,000) + there will be tax if any on the 30k income. (+ any state tax if applicable).
If we sell UNVC for 1 million dollar profit and have held for 1 year + 1 day, then then Fed Income Tax = $200,000 (20%) and then there is state tax and in California that = another 14% = $140,000 and hence we take home $660,000 (66%).
Each State has its own tax rate.
For the IRS, all Capital Gains is calculated on Schedule D and then ends up on Form 1040.
For Short Term Capital Gains - we always pay a higher rate.
Hope this helps.
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