Capital Gains Calculator -- Example
Suppose you bought some stock at $30 a share, and within one year your stock has rocketed to $50.
But you think it's due for a correction, and in fact you think it may never see $50 again.
Should you sell now and take a brutal tax hit, or should you hang on just long enough to take advantage of a lower tax rate?
We'll initialize the calculator with some plausible declining stock prices: $50 a share if you sell now, and $45 if you wait until the "one year plus one day" mark.
You'll probably find that, unless you have a very high federal tax bracket and live in a state with an unusual tax code, it doesn't pay to wait: you'll get the highest net if you sell now.
So this is one case where you have to be careful not to let your eagerness for a tax break lead you to a decision that isn't really in your best interest.
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