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Zecco.com » General Investing » Tax Matters » Don't understand capital gains
Last post 04-12-2008, 4:34 PM by kpctop. 2 replies.
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  •  04-08-2008, 9:29 PM 26653

    Don't understand capital gains

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        4 years ago I bought some $750 of stock and sold it in 2007 for $2071
        2 years ago I bought $5000 and sold in 2007 for $6812
    Am I going to be taxed on $8883 total selling price or on the $1321+$1812=  $3033 gain?
    The 1099-B gives the total selling price.

    thx

    Chris

  •  04-08-2008, 11:08 PM 26657 in reply to 26653

    Re: Don't understand capital gains

    Reply Quote
    I had this similar issue with my TDAmeritrade account, I had over 8,000 in sales, yet my cost basis was 6800. The 1099-B reflected the totals for all of my selling.

    Seems that you have to figure out your own cost basis (especially if you have multiple lots.).

    My tax due was only on the difference between the selling price and the costs, thereby owing tax on $1200.

    500 was long term gains (aka Capital Gains only), and the other 700 was short term (less than one year) and was taxed at normal income rate.

    As far as your situation, both of your sales are long term, and you should only owe capital gains taxes on the sales (check to see what your applicable capital gains tax rate is.)

    You correctly inferred that your taxes are due on only the gains (3033). I believe Cap. Gains is maxed out at 15%, and 10% in some tax brackets. So, I think you might only owe a max of <$500 in tax.

    Atleast, this is what I can remember from doing my taxes last month...

  •  04-12-2008, 4:34 PM 26884 in reply to 26657

    Re: Don't understand capital gains

    Reply Quote
    Thx abudriver!
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