Capital Gain Tax on Stock owned more than 5 Years?

Hi,

I've owned a stock along the lines of $MSFT , $AAPL , $AEP , $CSCO , $GS and I own it for more than 5 years. From my understanding if you own it less than a year you pay more than you do if you own it between 1 and 5 years. For more than 5 years it is not so clear how much I need to pay (at least to me).

Thanks.

10 Answers

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  • Bobbie
    Lv 7
    5 years ago
    Best Answer

    Held or owned for MORE than 1 year and then sold with a gain would be long term capital gain LTCG and would be the best rate that you could qualify for during the tax filing season for that past tax year.

    Forget about the more than 5 year period for this purpose.

    Form 8949 and the schedule D using the information from the payer of the funds that will be reported to you on your 1099-B after the end of the tax year during the tax filing season for that past tax year.

    Hope that you find the above enclosed information useful. 12/07/2014

  • 5 years ago

    You are correct in that you pay a higher rate for short term (less than 1 year) capital gains. There is not limit for the long term (more than 1 year) capital gains, so the 5 years is irrelevant. You will either pay 0%, 15%, or 28%(i believe, but not completely sure). The amount of tax you have to pay is based on your personal tax bracket. most people fall into the 15% tax bracket.

    You will most likely have to pay 15% tax on whatever gains you receive on the sale of the stock.

  • Judy
    Lv 7
    5 years ago

    A year or less is taxed as ordinary income, higher than the long term capital gains tax on something earned over a year. There's no reduction for longer - owned 50 years or a yer and a day gets the same rate

  • NA
    Lv 7
    5 years ago

    For an accurate answer, see IRS publication 505.

    Capital gains sold after a year and a day get a lower rate.

    If your TOTAL income (including the gains) is less than $36900 (single), you will pay 0% on the LTCG.

    If your TOTAL income before gains is more, you will pay 15%.

    If your total income without gains is less than $36900, only the amount of gain that still fits into less than number gets the 0% rate. After you cross over to the 25% bracket, you pay 15%.

    Recapture of depreciation (not applicable here) is capped at 25%.

    Gain on collectibles (not applicable here) is capped at 28%.

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  • 5 years ago

    It's long term, flat 15%. Long term is anything over 1 year, 2, 5, 10, 50, whatever.

  • 5 years ago

    5 years is still part of more than one year. Short term is 1 year or less. Long term is MORE than one year so it has to be one year plus a day.

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  • tro
    Lv 7
    5 years ago

    its pretty clear, short term is holding stock for less than a year and selling, the gain is taxed at your ordinary rate

    long term is a year or more, any number of years MORE, and the tax rate is 15% unless you have LOTS of gain(hundreds of thousands)

  • Anonymous
    5 years ago

    There is no "five year rule." A year or less is a short-term gain. All greater is long-term.

  • Biff
    Lv 7
    5 years ago

    long term rate is based on your tax bracket

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