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| *Loan,banking and credit>>>tax accounting |
If you sell stocks but the money is still in the account, do you need to pay taxes? |
Or is it only when you take it out of the stock account? Unless the account is a retirement account on which earnings are deferred until you start withdrawals (e.g., IRA, Keogh, 401(K), etc.) the income tax is due on the gain (or a credit received against other income on the loss) at the time of the sale. Unfortunately, It makes no difference whether you take possession of the proceeds or not. Whether it's a short term or a long term gain depends on the holding period (the time between your purchase and your sale of that particular stock). That's what makes a Roth IRA so attractive. Although you get no deduction on the funds you invest in a Roth IRA, they do grow tax free as long as you leave the funds in the Roth account, no matter how many times you buy or sell assets. you have control over the money in that account, so yes, it's taxable even if you haven't withdrawn it. Unless it's a 401K or IRA account, then any earnings stay in and are not taxed till money is taken out. You pay taxes on the difference between buying price and selling price and you always pay taxes on any dividends and rebates you get - if you are dealing with a taxable brokerage account. You have to pay taxes. unless it is non taxable account. The taxes are the same you pay on your normal taxes it's not more unless it puts you in a higher tax bracket. 1) Yes. 2) No. |
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