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Capital gain will be (40 X [$40 - 27] =) $520
When a capital asset is sold, its value increases, and this is referred to as a capital gain. Simply put, a capital gain happens when you sell an asset for more money than you paid for it initially. Almost every item you hold, whether it was bought for personal use or as an investment (such as a stock, bond, or piece of real estate), is a capital asset (like furniture or a boat).
When you sell an asset, you can realize capital gains by deducting the purchase price from the sale price. Individuals are subject to capital gains taxes by the Internal Revenue Service (IRS) under specific conditions.
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The capital gain will be (40 X [$40 - 27] =) $520 if you hold 40 shares of bp stock and the stock price rises from $27 to $40 a share
A capital gain occurs when the value of a capital asset rises when it is sold. A capital gain occurs when you sell an asset for more money than you initially paid for it. Almost everything you own is a capital gain, whether you bought it for your own use or as an investment (such a stock, bond, or piece of real estate) (like furniture or a boat).
When you deduct the purchase price from the sale price of an asset, you can generate capital gains. The Internal Revenue Service (IRS) may impose capital gains taxes on individuals in certain situations.
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