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  1. #1
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    Taxes and stock trading

    My guess is you just file on any profit that you've made from trading that year? Is that valid?

  2. Member
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    #2
    Yes and No. You would pay taxes for any dividends you received from the stock in the calendar year prior to the sale date (if any). You would also pay capital gains tax if the stock gained value for the entire period you owned the stock. Short term capital gains if the stock is owned less than a year. Long term capital gains if you owned the stock for greater than a year. Different tax rates apply based on category.
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    #3
    Is there any minimum amount or is every single bit taxable?

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    #4
    Quote Originally Posted by Bassmaster96 View Post
    Is there any minimum amount or is every single bit taxable?

    Every single bit is taxable.
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  5. Member
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    #5
    So do you have to keep up with it and report it yourself, or do some of the online trading platforms give you a summary sheet or something?

  6. #6
    Fidelity gives me a complete EOY statement with all needed tax info. I can also download a csv spreadsheet of all my trading that can be imported into income tax software. If you are trading stocks within an IRA it's not taxable.

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    #7
    Alright, cool. So are taxes the reason these sites ask for all of the detailed personal information, such as net worth, employer, etc.?

  8. Member
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    #8
    You should get a year end tax statement. You may want to call the stock shareholder serviced to verify what they provide, especially if you traded stock directly versus a mutual fund/retirement plan fund.

    There are different rules if your stock is under a qualified retirement plan. There you can reinvest in another qualified plan without the income being taxed.

    One other point if you use Turbotax and maybe other DIY Tax software is the need to buy the correct software version. For example, You have to buy the higher cost software if you sold stock in the tax calendar year. So check that out before you buy tax software.
    '14 Triton 18XS 150 Optimax Pro XS Fortrex 80
    Kropf Park model on Chautauqua Lake
    Fish Chautauqua Lake and Lake Erie
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  9. Stocks/Investments Moderator boneil's Avatar
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    #9
    You also want to file your losses. On Etrade, and I assume other platforms, I can simply upload all my trades to turbo tax with a click of the mouse. Turbo tax keeps all records and the losses get carried forward to offset future gains.
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    #10
    Alright, thanks guys

  11. Banned
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    #11
    Just wait until you get 70 1/2 years old--like my wife. The IRS requires that you sell a percentage of your 401K/IRA's every year--starting at about 4% of the total worth. They want their taxes on your investments--whether or not you spend the money. And since no taxes were ever paid on the money, it's taxed as income--not capital gains.

    $1 million IRA/401K portfolios are very often seen. That's $40,000 or so that must be withdrawn. The penalty for not making RMD's is 50%.

    That may make me buy a new bassboat in 2021--since the $ will just be sitting there doing nothing.

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    #12
    Quote Originally Posted by Bamaman View Post
    Just wait until you get 70 1/2 years old--like my wife. The IRS requires that you sell a percentage of your 401K/IRA's every year--starting at about 4% of the total worth. They want their taxes on your investments--whether or not you spend the money. And since no taxes were ever paid on the money, it's taxed as income--not capital gains.

    $1 million IRA/401K portfolios are very often seen. That's $40,000 or so that must be withdrawn. The penalty for not making RMD's is 50%.

    That may make me buy a new bassboat in 2021--since the $ will just be sitting there doing nothing.
    Yay

  13. #13
    I retired last December, and I'll voluntarily begin IRA withdrawals this year at 60, mostly just for spending money. It's time to reap the harvest, and I plan to enjoy spending what I worked hard to save and invest. Kentucky doesn't tax retirement income, and I will only pay federal income tax. I'm a happy camper!

    I watched an Uncle die at 84, in 2011, with over $500K in his investment portfolio. He was still investing all his pension he could. He would have rather taken a beating, than to spend $10 on something he didn't have to have.

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    #14
    Quote Originally Posted by mossie3 View Post
    I retired last December, and I'll voluntarily begin IRA withdrawals this year at 60, mostly just for spending money. It's time to reap the harvest, and I plan to enjoy spending what I worked hard to save and invest. Kentucky doesn't tax retirement income, and I will only pay federal income tax. I'm a happy camper!

    I watched an Uncle die at 84, in 2011, with over $500K in his investment portfolio. He was still investing all his pension he could. He would have rather taken a beating, than to spend $10 on something he didn't have to have.
    Congrats

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    #15
    Quote Originally Posted by Bamaman View Post
    Just wait until you get 70 1/2 years old--like my wife. The IRS requires that you sell a percentage of your 401K/IRA's every year--starting at about 4% of the total worth. They want their taxes on your investments--whether or not you spend the money. And since no taxes were ever paid on the money, it's taxed as income--not capital gains.

    $1 million IRA/401K portfolios are very often seen. That's $40,000 or so that must be withdrawn. The penalty for not making RMD's is 50%.

    That may make me buy a new bassboat in 2021--since the $ will just be sitting there doing nothing.
    Not to mention that your SS will be open to 85% being taxed.