What to Know About Stocks When Filing Your Taxes

Investing in stocks can be a great way to make money quickly, but the stock market has also been a proven generator of long-term gains. No matter your investment strategy or goals, anyone who invests in stocks needs to understand how stocks factor into your tax liabilities.

More specifically, you need to know how gains and losses affect your taxes. While most people file a simple tax return using an employer-supplied W2 form, investors often have different forms to fill out and file to comply with federal tax laws.

Capital Gains and Losses

As mentioned, gains and losses on your capital in the stock market are two of the biggest factors in whether you owe money come tax time. In general, capital gains are taxed, and the rate at which they are taxed depends on the current tax code. Losses, too, can affect your taxes as some losses can be written off on your taxes.

Most people who have complicated tax scenarios involving gains and losses in the stock market work with stock tax advisors to untangle the complexity. You can look for a Bronx employee stock tax advisor if you’re in the NYC area and need to ask questions about stocks as an employer. A Bronx employee stock tax advisor can offer guidance regarding federal tax laws and New York tax laws, but they may not be able to help if you have financial concerns in another state. Gain tax confidence with our Bronx employee stock tax advisor – explore this website for expert guidance!

Unrealized Gains

Something else to note about stocks and taxes is the potential for unrealized gains or losses to affect your tax liability. There has been a push in Washington lately to attempt a tax on unrealized gains for some high-income individuals.

This would essentially tax you on money you haven’t made yet but may make in the stock market. Although this may not affect you directly as an investor, it’s still a good idea to partner with a tax expert to ask for guidance.

Disclaimer: The above is not tax or investing advice. Consult with a tax attorney in your area to learn about your obligations and responsibilities.

Read a similar article about Brooklyn tax preparation here at this page.