How much tax can I expect to pay if I gain profit from selling stocks for short time trade?
sunshine asked:
I am planning on buying Visa stock on the first day when the market opens. If the stock goes up rocket high in the first day or two, then I want to sell it and cash out some gains. If I do that how much tax do I need to pay to “uncle Sam″ as short term capital gain? I am thinking of investing 20K.
I am planning on buying Visa stock on the first day when the market opens. If the stock goes up rocket high in the first day or two, then I want to sell it and cash out some gains. If I do that how much tax do I need to pay to “uncle Sam″ as short term capital gain? I am thinking of investing 20K.
it is just like any other income, depends on what tax bracket you are in what percent you pay
Whatever profit you make is counted as part of your income. There is a place on the tax forms to indicate capitals gains and what percent is taxable.
Short term capital gains are taxed as ordinary income so the rate will depend upon your entire tax situation. If you turn a $10k profit and are in a 25% tax bracket it would cost you at least $2,500 in Federal income taxes.