DOing taxes on STOCK sales/capital gains...HOW???

[Big Rush]

Ameritrade sent me my w-90, or i think thats what it said...anyway, i have bought/sold many stocks since last year....how do i do these taxes? can i take it to H&R block? someone please help me...thanks in advance

[Be Real]

bro goto www.irs.gov and click the link for taxes. HR&R block will do it for you free and E-file it as well they ask you questions etc and you just put in the #'s. I'll find the link and post it for ya bro.

[Be Real]

http://www.irs.gov/app/scripts/exit....artners/gov_ff

[Be Real]

click the I agree to exit the site button then select the basic free file service it will guide you through it let you put in your bank aco**** etc and you will have youre return in 15 days in your account automatically deposited.

[Tock]

I hope you kept good records of what you bought and sold. Otherwise, it'll be like 21 year old snatch -- hairy.

If you bought, say, 100 shares of ABC corporation at $10 each in January, you spent $1000 total. If you sold all 100 shares in February for $20 each, you received $2000 total. You then subtract your cost from your net profit, and you have to pay taxes on $1000. (Well, you can deduct whatever charges your broker stuck you with, but we'll keep this simple).

Now, if you took that $2000 and bought 100 shares of XYZ corporation at $20 a share in March, and then sold it for $10 a share in April, then you lost a total of $1000, so you would deduct that loss from your net gains, and you'd be liable for taxes on $000.
Even if it's zero, you still have to file the forms to report your activity (I think, anyway).

Now . . . say you bought 100 shares of ABC at $10 in January, your net cost would be $1000.
If you sold 50 shares of ABC in February for $20, your profit from their sale would be $500. You would report income of $500.
Now, let's say you took that $500 and bought 10 more shares of ABC in March for $50 a share.
Your total cost for your shares is $1000, and your total income for the year is $500.

In April, you decide to sell 5 shares of the ABC stock you purchased in January (at $10 a share) in April for $500 ($100 a share). You paid $10 a share for it, sold it at $100, so your net profit on this trade is $90/share x 5 = $450.

But -- If, in April, you decide to sell 5 shares of the ABC stock you purchased in March for $50 a share for $100, you end up with the same amount in your wallet, but -- your cost on those 5 shares was $50 x 5 = $250, and your selling price was $500, so you tell the IRS your income on those shares was only $250 instead of $450, and you pay less income tax.

------------------

So, ya, when you buy and sell stocks like that, you really really really need to keep excellent, detailed records. I hope you have 'em, or your broker can get 'em for ya. Otherwise, you're probably gonna end up paying a lot more taxes than you should.

Good luck . . .
-Tock

[Jdawg50]

accountant bro

[Tock]

One other thing . . .
One of the advantages of investing in a mutual fund is that they keep track of all those stock trades for ya; figuring out what your annual + or - is is a lot easier . . .
-Tock

[Jdawg50]

One other thing . . .
One of the advantages of investing in a mutual fund is that they keep track of all those stock trades for ya; figuring out what your annual + or - is is a lot easier . . .
-Tock

Hey Tock,
Sorry to highjack the thread but,
Do you need to worry about + or - gains with a roth or 401K?

[Tock]

Hey Tock,
Sorry to highjack the thread but,
Do you need to worry about + or - gains with a roth or 401K?

Not really.

If you make $50,000 income, you put $3000 in a 401k, you only have to pay income tax to the IRS for $47,000. That saves you 20-something % tax on that $3000, so you can spend it on wasteful and licentious living. Then when you retire, when you withdraw, say, $30,000 a year for living expenses, you pay income tax on the full $30,000. But all the stock profits are tax free for as long as you don't take anything out. Cool-o-rama.

If you make $50,000 income, you put $3000 in a Roth IRA, you still have to pay income tax on the full $50,000 BUT you don't pay any income tax on the money you take out after you reach the age of 59 1/2. And, like the 401k, the stock profits are not taxed as long as the $$$ stays in the account.

The difference is pretty much just when you pay taxes -- up front, or at the end. When the Roth first came out, people were saying it's a better deal than the 401k, but IMHO, I don't think there's much difference.
Plus, I would suspect that in another 30 or 50 years or so, if there's a lot of people taking tax-free money out of their Roth accounts, and if the government is desperate for $$$, then they're probably gonna figure out some way to tax the Roth money.

Who knows . . .

But for sure, before you invest in anything else, you want to max out your allowable contributions to either a Roth or 401k. It's tax-free deferred money, and that's the best deal in town.

--Tock

[Jdawg50]

gotcha bro
so bottom line is you do not pay taxes on the earnings from the roth, but when you take out earnings from the 401k you will? right?

[Tock]

gotcha bro
so bottom line is you do not pay taxes on the earnings from the roth, but when you take out earnings from the 401k you will? right?

That's it.

Best long-term place to park your $$$, IMHO, especially if you don't intend to fuss with your investments and spend a lot of time keeping up with what's happening in the stock market and the economy in general, is the Vanguard 500 mutual fund. Its expenses are dirt cheap, and it's a good investment company. One of the few that didn't get dinged in the last mutual fund scandal. www.vanguard.com And index funds are the way to go, anyway.
-Tock

[3Vandoo]

this sucks, in Canada they will charge you taxes after you earned more than 500 000k total lifetime.