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Author Topic: USA capital gains  (Read 4273 times)
mgio
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December 08, 2013, 10:17:01 AM
 #21

you can do a little research before seeking help. i just looked up some info here http://www.bankrate.com/finance/money-guides/capital-gains-tax-rates-1.aspx

capital gains taxes apply if your taxable income is less than $35k (single) or $70k (joint).. otherwise, you don't have to pay them. so if you don't make that much money, you can buy/sell as you like.. so long as your total income does not exceed $35k. you also need to own the asset for more than 1 year before selling it, so no day trading.

I'm trying to actually get through this, how does it work if 100% of my income was capital gains? Say I bought for negligible amounts of $ back in 2010, and cashed out $100K this year. Is it 0% on all of it, 0% on the first $35k, 15% on the rest, or 15% on all of it?

i wouldn't know for sure, i'm not an expert on taxes... but i believe it is 0% tax on the first $35,000 and 20% for anything after that. so your effective tax capital gains tax rate would be 20% of $65,000. it's no longer 15% btw.

It's still 15%
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December 08, 2013, 07:54:44 PM
 #22

you can do a little research before seeking help. i just looked up some info here http://www.bankrate.com/finance/money-guides/capital-gains-tax-rates-1.aspx

capital gains taxes apply if your taxable income is less than $35k (single) or $70k (joint).. otherwise, you don't have to pay them. so if you don't make that much money, you can buy/sell as you like.. so long as your total income does not exceed $35k. you also need to own the asset for more than 1 year before selling it, so no day trading.

I'm trying to actually get through this, how does it work if 100% of my income was capital gains? Say I bought for negligible amounts of $ back in 2010, and cashed out $100K this year. Is it 0% on all of it, 0% on the first $35k, 15% on the rest, or 15% on all of it?

i wouldn't know for sure, i'm not an expert on taxes... but i believe it is 0% tax on the first $35,000 and 20% for anything after that. so your effective tax capital gains tax rate would be 20% of $65,000. it's no longer 15% btw.

It's still 15%

it's not. http://en.wikipedia.org/wiki/Capital_gains_tax_in_the_United_States

Quote
The American Taxpayer Relief Act of 2012 (signed on January 2, 2013) made qualified dividends a permanent part of the tax code but added a 20% rate on income in the new highest 39.6% tax bracket. As a result:

The long-term capital gains tax rate is 20% (0% for taxpayers in the 10% and 15% tax brackets).

mgio
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December 10, 2013, 07:32:28 PM
 #23

you can do a little research before seeking help. i just looked up some info here http://www.bankrate.com/finance/money-guides/capital-gains-tax-rates-1.aspx

capital gains taxes apply if your taxable income is less than $35k (single) or $70k (joint).. otherwise, you don't have to pay them. so if you don't make that much money, you can buy/sell as you like.. so long as your total income does not exceed $35k. you also need to own the asset for more than 1 year before selling it, so no day trading.

I'm trying to actually get through this, how does it work if 100% of my income was capital gains? Say I bought for negligible amounts of $ back in 2010, and cashed out $100K this year. Is it 0% on all of it, 0% on the first $35k, 15% on the rest, or 15% on all of it?

i wouldn't know for sure, i'm not an expert on taxes... but i believe it is 0% tax on the first $35,000 and 20% for anything after that. so your effective tax capital gains tax rate would be 20% of $65,000. it's no longer 15% btw.

It's still 15%

it's not. http://en.wikipedia.org/wiki/Capital_gains_tax_in_the_United_States

Quote
The American Taxpayer Relief Act of 2012 (signed on January 2, 2013) made qualified dividends a permanent part of the tax code but added a 20% rate on income in the new highest 39.6% tax bracket. As a result:

The long-term capital gains tax rate is 20% (0% for taxpayers in the 10% and 15% tax brackets).



I'm not sure where you are getting that. From that wikipedia page you linked:

"The long-term capital gains tax rate is 15% (0% for taxpayers in the 10% and 15% tax brackets, and 20% for taxpayers in the 39.6 bracket)."

To be in the 39.6% tax bracket you need to make about $400k/yr
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December 13, 2013, 05:24:48 PM
 #24

Quote
The American Taxpayer Relief Act of 2012 (signed on January 2, 2013) made qualified dividends a permanent part of the tax code but added a 20% rate on income in the new highest 39.6% tax bracket. As a result:

The long-term capital gains tax rate is 20% (0% for taxpayers in the 10% and 15% tax brackets).

I'm not sure where you are getting that. From that wikipedia page you linked:

"The long-term capital gains tax rate is 15% (0% for taxpayers in the 10% and 15% tax brackets, and 20% for taxpayers in the 39.6 bracket)."

To be in the 39.6% tax bracket you need to make about $400k/yr
Wikipedia is currently wrong then.



https://www.fidelity.com/viewpoints/personal-finance/taxpayers-guide
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December 13, 2013, 09:47:29 PM
 #25

but how does one prove when he purchased his BTC? what if i purchased it say 2 years ago, but in 1 year i want to sell off some coins and want to claim that i bought it 1 year prior.. i'd effectively pay significantly less since the value of BTC today is $1,000 more than last year, and it'd be 15% only.
US capital gains is 20%.   plus another 3.8% if you make over 250k to pay for obamacare.   
Okay, one pays the capital gains tax.  Does one then need to also pay income tax on the money?

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bitbouillion
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December 14, 2013, 11:44:50 PM
 #26

If a profit from Bitcoin sales is counted as capital gains, can I discount the capital losses incurred by e.g., stocks?

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mb300sd
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December 14, 2013, 11:49:07 PM
 #27

Quote
The American Taxpayer Relief Act of 2012 (signed on January 2, 2013) made qualified dividends a permanent part of the tax code but added a 20% rate on income in the new highest 39.6% tax bracket. As a result:

The long-term capital gains tax rate is 20% (0% for taxpayers in the 10% and 15% tax brackets).

I'm not sure where you are getting that. From that wikipedia page you linked:

"The long-term capital gains tax rate is 15% (0% for taxpayers in the 10% and 15% tax brackets, and 20% for taxpayers in the 39.6 bracket)."

To be in the 39.6% tax bracket you need to make about $400k/yr
Wikipedia is currently wrong then.



https://www.fidelity.com/viewpoints/personal-finance/taxpayers-guide

Still trying to figure out how this works exactly. I have precisely $0 of non-capital gains income, and less than 450k of capital gains. Are capital gains counted in determining your rate for capital gains? And if it is, is the first $36250 at 0% and the remainder at 15%, or is all of it at 15%?

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December 15, 2013, 01:52:48 AM
 #28

Still trying to figure out how this works exactly. I have precisely $0 of non-capital gains income, and less than 450k of capital gains. Are capital gains counted in determining your rate for capital gains? And if it is, is the first $36250 at 0% and the remainder at 15%, or is all of it at 15%?
I don't know, but in case it didn't occur to you, you could probably figure this out by reviewing the 2012 1040 (or manually filling it out with test numbers to do the math if the instructions don't make it clear).
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December 15, 2013, 06:36:04 AM
 #29

Quote
The American Taxpayer Relief Act of 2012 (signed on January 2, 2013) made qualified dividends a permanent part of the tax code but added a 20% rate on income in the new highest 39.6% tax bracket. As a result:

The long-term capital gains tax rate is 20% (0% for taxpayers in the 10% and 15% tax brackets).

I'm not sure where you are getting that. From that wikipedia page you linked:

"The long-term capital gains tax rate is 15% (0% for taxpayers in the 10% and 15% tax brackets, and 20% for taxpayers in the 39.6 bracket)."

To be in the 39.6% tax bracket you need to make about $400k/yr
Wikipedia is currently wrong then.



https://www.fidelity.com/viewpoints/personal-finance/taxpayers-guide

Still trying to figure out how this works exactly. I have precisely $0 of non-capital gains income, and less than 450k of capital gains. Are capital gains counted in determining your rate for capital gains? And if it is, is the first $36250 at 0% and the remainder at 15%, or is all of it at 15%?
Yes, capital gains are counted in determining the rate.  And yes, the first $36,250 is at 0%, and the remainder (up to $450k) at 15%.  But if you already have $40k in adjusted gross income, you'll have 15% tax on any capital gains.
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December 15, 2013, 07:47:22 AM
 #30

Quote
The American Taxpayer Relief Act of 2012 (signed on January 2, 2013) made qualified dividends a permanent part of the tax code but added a 20% rate on income in the new highest 39.6% tax bracket. As a result:

The long-term capital gains tax rate is 20% (0% for taxpayers in the 10% and 15% tax brackets).

I'm not sure where you are getting that. From that wikipedia page you linked:

"The long-term capital gains tax rate is 15% (0% for taxpayers in the 10% and 15% tax brackets, and 20% for taxpayers in the 39.6 bracket)."

To be in the 39.6% tax bracket you need to make about $400k/yr
Wikipedia is currently wrong then.



https://www.fidelity.com/viewpoints/personal-finance/taxpayers-guide

Still trying to figure out how this works exactly. I have precisely $0 of non-capital gains income, and less than 450k of capital gains. Are capital gains counted in determining your rate for capital gains? And if it is, is the first $36250 at 0% and the remainder at 15%, or is all of it at 15%?
Yes, capital gains are counted in determining the rate.  And yes, the first $36,250 is at 0%, and the remainder (up to $450k) at 15%.  But if you already have $40k in adjusted gross income, you'll have 15% tax on any capital gains.

Yay, might have a lower than expected tax bill...

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mgio
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December 16, 2013, 06:00:47 AM
 #31

If a profit from Bitcoin sales is counted as capital gains, can I discount the capital losses incurred by e.g., stocks?

Yup.
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December 16, 2013, 06:43:07 AM
 #32

I'd be careful and consult a tax specialist before you go ahead and classify your gains on bitcoin as capital gains.

The IRS has yet to issue a determination on bitcoin, and it could just as easily classify bitcoin as a foreign currency, in which case there ARE NO CAPITAL GAINS ONLY REGULAR INCOME OR LOSS.

Again, consult a tax specialist, especially if you have significant gains from bitcoin.

http://www.forbes.com/sites/greatspeculations/2013/12/03/the-tricky-business-of-taxing-bitcoin/
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December 16, 2013, 07:12:01 AM
 #33

I'd be careful and consult a tax specialist before you go ahead and classify your gains on bitcoin as capital gains.

The IRS has yet to issue a determination on bitcoin, and it could just as easily classify bitcoin as a foreign currency, in which case there ARE NO CAPITAL GAINS ONLY REGULAR INCOME OR LOSS.

Again, consult a tax specialist, especially if you have significant gains from bitcoin.

http://www.forbes.com/sites/greatspeculations/2013/12/03/the-tricky-business-of-taxing-bitcoin/
The worst they could do is backdate you with ordinary income rates though right?  They can't slap you with extra fines on something they haven't released clarification on...
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December 17, 2013, 12:25:06 AM
 #34

I see Norway has decided Bitcoin is an asset not a currency.

http://www.finextra.com/news/fullstory.aspx?newsitemid=25547

Wonder how Bitcoin mining will effect social security disability status.  Can one mine Bitcoins while on unemployment insurance?  Will mining have an effect on collecting social security retirement?  Probably should look to Alaska gold fields and see what they do there.

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