Made a Lot of Money in the Stock Market This Year? Here's How to Lower Your Capital Gains Taxes
Though 2020 was certainly a rocky year for investors, with stock values plummeting as the COVID-19 crisis expanded into a pandemic, the market has recovered nicely since its spring nadir. Now, a lot of investors are looking at stocks in their portfolios trading at or near record highs. If you're thinking of cashing out of some of those investments while they're up, don't forget to consider your choices from a tax perspective.
Whenever you sell investments for more than what you paid for them, you're liable for taxes on your capital gains. The tax rates on those profits are highest for investments held for a year or less before being sold. But even long-term capital gains -- those that apply to investments that are held for at least a year and a day -- are subject to taxes that could result in quite a big IRS bill.
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Source Fool.com
