Author Topic: Personal Taxable Account - How are the gains taxed?  (Read 888 times)

HoneyChaseZippy

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Personal Taxable Account - How are the gains taxed?
« on: August 15, 2018, 01:32:04 PM »
Quick question, say I have 100k invested for over 1yr (seasoned) and the current balance is 120k.  20k gains for that year.  However, if I need to pull some cash out say 60k today, how am I taxed?  50k as the cost basis (untaxed) then 10k taxed from gains? 

Maybe I'm not asking this correctly but is there a simple to determine what I'll be taxed if I decide to take some of the proceeds back?

terran

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Re: Personal Taxable Account - How are the gains taxed?
« Reply #1 on: August 15, 2018, 01:53:31 PM »
If you bought all $100k (now $120k) at the same time, then yes, selling $60k would result in a $10k capital gain. This would also be true if you used average cost basis tracking whether or not you bought all at the same time, but it's better to use specific identification tracking as you can then choose what lots to sell if some have different amounts of gains than others.

How much you'll pay in tax will depend on your filing status and other income, but will be between 0 and 20%, plus I think 3.8% medicare surcharge if you're income is especially high.

HoneyChaseZippy

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Re: Personal Taxable Account - How are the gains taxed?
« Reply #2 on: August 15, 2018, 03:35:10 PM »
Thank you.  Yes, I did it in one shot last year and may need some of those assets for other investment opportunities.  That makes sense with everything you just mention.  Thanks again!