Selling millions of dollars worth of stocks?

Let's say someone purchased a couple hundred thousand shares of a super low stock. The stock finally takes off and is worth say $10.00 a share. The almost worthless portfolio's stock is now valued at close to $3 million dollars. If this were on an account like E-trade or Sharebuilder, does the owner selling the shares get taxed by anybody? Is any money lost any where else once someone goes from crappy portfolio to millions of dollars? I am really just wondering how much of the profits of a rising stock minus fees and taxes is kept by the trader?

3 Answers

  • rtfm
    Lv 7
    8 years ago
    Favorite Answer

    When you sell stocks at a profit, you need to report that profit on your income taxes. It doesn't matter whether you have gone through an online broker or an in-person one. Profits are profits.

    How much of the profit the owner of the stocks gets to keep depends on what tax bracket they're in.

    Realistically, someone who had made a $3 million stock sale would probably re-invest most of those funds. You're acting as if they're just going to walk away with bags full of cash. It doesn't usually happen that way.

  • 8 years ago

    Whenever you have profitted from stock trading, the government would tax it. Why, you think Obama works for free?

  • 8 years ago

    The government always gets a slice of the pie.

    A US Citizen or resident alien would have to pay the IRS and their state, assuming that their state has an income tax.

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