Your Question:
"What is the difference between long-term and short-term gains?"
Long-Term vs Short-Term Capital Gains: Tax Rate Difference
Compare LTCG and STCG rates and when each applies.
⚡Quick Answer
- •User confused about different tax rates
- •Category: tax | Level: beginner
- •Applies to: US
Understanding the Problem
User confused about different tax rates
The Solution
Understanding this concept is key to making better investment decisions.
Read through the explanation below to clear your confusion.
Example Scenario
Situation: You purchased 100 shares at $100 on January 15, 2024, and sold them at $130 on November 15, 2024.
Analysis: Holding period = 10 months (less than 12 months = short-term)
Result: Gain of $3,000 taxed as ordinary income at your marginal rate.
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