Capital Gains Minimal Taxes

by Kaye A. Thomas

Book Overview

An updated edition of this book is now available. This book makes it easy to understand the tax rules for buying, owning and selling stocks, mutual funds and options, and the best strategies for... This description may be from another edition of this product.

• Format: Paperback
• Language: English
• ISBN: 0967498147
• ISBN13: 9780967498140
• Release Date: December 2000
• Publisher: Fairmark Press
• Length: 304 Pages
• Weight: 0.85 lbs.
• Dimensions: 0.7" x 5.5" x 8.5"

Customer Reviews

Well done and very helpful

As a first year full time trader I found this book to be very helpful.

Great Book for Learning About the Taxation of Investments

In clear and simple language, "Capital Gains, Minimal Taxes" explains most investment-tax-related topics investors need to understand, ranging from calculating your basis on stocks and mutual funds to maximizing the allowed tax deduction for a capital loss.Because taxes consume a substantial chunk of ordinary income, many knowledgeable investors wish to maximize their investment in things which are taxed at the more favorable capital gain tax rates (currently 10% for investors within the 15% income tax bracket and 20% for investors whose entire income falls above the 15% income tax bracket). Thomas begins by working several examples to show investors how to calculate their tax burden given their tax bracket and the amount of their short-term and long-term capital gains and losses from stocks and mutual funds. Thomas devotes a chapter each to the special rules which apply to the taxation of individual stocks and mutual funds.Thomas shows that, sometimes, we can lower the capital gains tax paid by identifying the specific shares of individual stock being sold. For example, suppose we buy 100 shares in Company XYZ at $10 per share on July 1, 1999. We buy 100 more shares of XYZ at $20 per share on July 9, 2000. We then sell 100 shares of XYZ on July 19, 2001 for $30 per share. Unless we specified otherwise at the time of the sale, Thomas tells us that from a tax standpoint the shares sold will be treated on the first-in-first-out basis (FIFO). We will be taxed on a net long-term capital gain of $20 per share. However, had we identified the shares sold as those purchased on July 9, 2000, we would be taxed on only a net capital gain of $10 per share. Thomas explains the two things that must happen to ensure that the identification of shares will be deemed valid by the IRS.Calculating your adjusted basis in a stock or mutual fund and properly determining your holding period is covered in detail with numerous examples. He also explains how mutual fund dividends and capital gain distributions are taxed.Thomas gives us his opinion of the Alternative Minimum Tax (AMT). Thomas writes: "The basic idea behind the alternative minimum tax is a good one: people with very high levels of income shouldn't be able to completely avoid paying income tax while the rest of us pony up each year. The AMT is a poor reflection of that idea, however. Many high-income individuals escape its reach-and every year it ensnares more and more people who were never intended to be affected."Employees who had massive gains followed by equally massive losses on their employee stock options are one example of people who would have benefited by knowing the tax laws better. As you've probably read in the news, some individuals have gone from being wealthy to not having enough total wealth to pay their current tax liability, compliments of the AMT not playing nicely with employee stock options.While Thomas briefly touches upon the topic of employee stock options in Capital Gains, Minimal Ta

Ideal for those new to investment portfolio management

Kaye Thomas' Capital Gains, Minimal Taxes: The Essential Guide For Investors And Traders is a "plain language" guide to stocks, mutual funds, options, and tax strategies for maximizing returns and minimizing tax liabilities. Complete, authoritative, practical, "user friendly", this guide is ideal for those new to investment portfolio management and will prove both practical and invaluable in creating a personal financial investment plan with allied strategies. Indeed, Capital Gains, Minimal Taxes has much of value to offer even experienced investors with respect to tax rules for short sales, stock options, and "straddles". Highly recommended reading for sensible small investor strategic financial and investment planning.

The best book out there for taxes on stocks and mutual funds

This is probably the best book out there for the tax treatment of the following investment topics: stocks, options, short sales, wash sales, mutual funds, and dividends. I keep this book next to my computer and refer to it often. It has many examples. It even covers more advanced topics such as constructive sales and straddles. It has sections on the taxation of traders, gifts, accounts for minors, and AMT. It covers all of these topics accurately and thoroughly, while still being very readable for the non-tax professional. The author points out any grey areas of the tax law. This book isn't perfect (for example, in the section on estimated taxes, it doesn't mention form 2210 or what to do if unexpected income comes late in the year), but it is still very good.

The best guide out there for taxes on stocks & mutual funds

This book is the most complete, accurate, and easy to understand guide out there. I keep this book next to my computer and refer to it often. It covers in detail capital gains on stocks and options, short sales, wash sales, mutual funds, and dividends. It even covers more complicated strategies such as constructive sales and straddles. It has many examples. It has sections on taxation for traders, tax rules for gifts and minors, and AMT. It is accurate and thorough, yet explains things in a way that non-tax professionals can understand.