What are capital gains?
Capital gains refer to the increase in the value of an investment or asset that results in a profit when the asset is sold. Capital gains are realized when the asset is sold for a higher price than its original purchase price. Conversely, if the asset is sold for a lower price than its original purchase price, it results in a capital loss.
How are capital gains taxed?
Capital gains are subject to taxation, and the tax rate depends on the type of capital gain (short-term or long-term) and the individual's tax bracket. It's important to note that tax laws and rates are subject to change, so individuals should consult a tax professional or the IRS website for the most current information on capital gains taxation.