How Do You Report Short-Term Capital Gains?
How to Report Short-Term Capital Gains? – Questions from Readers Tuesday July 19, 2005 Dear Tax Guide, Is it correct that short-term capital gains are taxed under the same rate as regular income? If I have wage income of $20,000, and I have day-trading profits of $20,000 in a year (all stocks held less than one year), then does that mean my taxable income is $40,000? If this is so, is a Schedule D still necessary? Dear Reader, Yes, a Schedule D is still necessary. The reason is that the IRS does not know whether your gains are short-term or long-term unless you report that information on a Schedule D. Short-term gains are taxed at ordinary income tax rates, and long-term gains are taxed at special tax rates. Keeping track of your capital gains and losses is very important. You will need to keep track of your buying price, selling price, and transaction fees for each trad
