Question

What’s a capital gain or a capital loss?

Answer

A capital gain occurs when you sell a capital asset for more than what you paid for it.

A capital loss occurs when you sell a capital asset for less than what you paid for it. Most property is considered a capital asset, except these:

  • Inventory held for sale to customers
  • Depreciable business property
  • Real property used in a trade or business
  • Creative property like a copyright, literary work, musical, and so on
  • Accounts or notes receivable
  • Supplies used in a trade or business

Related Topics

Related Resources

How much can I make as a daycare provider before I am responsible for reporting child care income?

Learn more about reporting child care income with help from the tax experts at H&R Block.

Income Tax – Why Do We Pay Federal Income Tax

Learn about federal income tax and why citizens pay income tax. Get a brief introduction to federal income taxes and how H&R Block can help.

I have a question about reporting 401K rollover funds. I recently changed jobs and I rolled over a retirement account fr

Learn more about reporting a 401K rollover with tips from the tax experts at H&R Block.

If I report my 401K distribution, will I have to pay taxes on 401K distribution income again if taxes were withheld from

Learn more about taxes on 401K distribution with advice from the tax experts at H&R Block.