How a Bear Market Can Be a Blessing for Your Tax Bill
Although bear markets are a natural part of the stock market, nobody likes seeing their portfolio decrease in value, even if it's just on paper. You should always focus on the long term, but some moves can be made during down periods to give you some short-term relief. Cutting your tax bill is one of them.
To the surprise of I'm sure not many, Uncle Sam wants his share of your investment profits. The rate you pay on your profits (capital gains) depends on your income and how long you've held the investment. If you hold an investment for less than a year, you'll pay your regular income tax rate. If you hold it for a year or more, you'll owe a more favorable capital gains rate. Here are the 2022 capital gains tax rates:
Source Fool.com
