What are Capital Gains?

Capital Gains are the profits earned from the sale of an asset when the selling price exceeds the original purchase price. Capital gains can apply to stocks, real estate, businesses, or other investments.

Types:

• Short-Term Capital Gains: Realized on assets held for less than a year.

• Long-Term Capital Gains: Realized on assets held for over a year, often taxed at a lower rate.

Example:

If you purchase stock for $1,000 and sell it for $1,500, your capital gain is $500.

Tax Implications:

• Subject to taxation, with rates varying based on holding period and jurisdiction

• Important for personal and corporate investment strategies