Home     About Us    Contact Us     Contribute     Privacy
Investing
Stocks
Bonds
Mutual Funds
Biz
Credit
Career
College
Economics
Tax
More
 
 
Marketplace
Related Articles
More
Related Definitions
Related Categories
Tip of the Day

Tip of the Day Index Funds are Your Friend

Index Funds are Your Friend - Every stock market or stock exchange offers indexed funds and these index funds are more beneficial to you as a new investor as they...

read entire tip

Related Podcasts
Recently Added
Other Great Sites
 

Selling Mutual Funds

When an investor decides it is time to throw in the towel, then the investor is ready to sell their mutual funds. The investor must identify what shares they want to sell. The request must be made in writing in order to minimize the huge hit in capital gain taxes. Capital gain taxes are deferred until the investor begins to withdraw the money from the mutual fund. One mutual fund that does offers tax free growth on the investment is the Roth IRA. Fees are charged when the investor reaches the age of 59 1/2. Capital gain taxes must also be paid if you reinvested the money back into a different fund.

If the investor withdraws from the mutual fund, this is also considered selling shares of the mutual fund. Withdraws from the mutual fund are recorded the same way if the shares were sold directly and then capital gain taxes are calculated. The investor potentially sets up the risk of paying capital gain taxes twice-once on withdraws and then on selling of the mutual funds.

To calculate the amount of capital gain taxes, investors can use as what accountants call the first-in, first-out(FIFO) method or the average method.

Between the two methods, investors lean towards the simple answer-the average method.

The easiest way to calculate not being double slammed on the capital gain tax is the average method. There are two types of average method calculations: single-category and double category.

For the single-category method, this method computes all the shares together. The goal is to fall under the short-term capital gain tax rules.

For the double-category method, this involves separating the shares and calculating between the long-term and the short-term capital gain taxes. The investor must identify which shares were sold during this time.

For FIFO, the Internal Revenue Service(IRS) stipulates that investors must use the first shares that were sold to calculate capital gains. This is the price of the original purchase of the oldest shares. First thing is to identify he specific shares that were sold. The request must be made in writing in order to minimize the huge hit in capital gain taxes.

Discuss It!

discount codes said:

Itâs a tremendous post. I am truly grateful for this blog and I was in fact looking for something impressive like this should stay longer here, read all the post very nice posting you have

Coupon Codes said:

Great post and I guess Iâm also a fan of blog commenting as it has numerous benefits. Everyone must read this article

The Research Process Marketing Research Help said:

Good event, I think because to have a necessary books is very important for every profession, especially, for writers who make your life easier everywhere.

Essay Help said:

Things are very open and intensely clear explanation of issues. was truly information. Your website is very beneficial.

Academic Writing Service said:

Thanks for sharing this blog its very informative and useful for us .

Ethics And Libel Custom Term Paper Writing Service said:

It is a smart presentation with a unique way of writing and written in well mannered techniques.

Critical Chain Project Management Homework Help said:

I am not a brilliant identity but rather i like hues and artistic creations. Distinctive hues have diverse fascination so i do concur with creator.

Tinder PC said:

or this blog and I was in fact looking for something impressive like this should stay longer here, read all the post very nice

Instagram For PC said:

a tremendous post. I am truly gratef

Mobdro said:

grateful for this blog and I was in fact looking for something impressive like this should stay longer here, read all the post

Facetime For PC said:

nd I was in fact looking for something impressive like this should stay longer he

http://pixwords-help.org/ru/5-symbols said:

I may need to thank you for the tries you have made in encircling this article. I am believing a comparative best work from you later on as well.

SHAREit said:

this website is very nice and good.

http://www.davaodochospital.com/get-healthy-shinier-skin-ease/ said:

Perpetually consistent and an extraordinary commitment to the universe of bloggers.

Most Popular Articles
Most Popular Definitions
 
Daily Definition

Definition of the Day Proof Of Concept

Proof Of Concept – (Proof-of-concept) Referring to the types and applicability, reliability or evidence, verification, confirmation and corroboration, even substantiation, or resilience of data, fact etc. Also called POC, showing its usefulness and applications, features and possibilities, allowing to an extent no to low risk exposure and exploration, prospecting if...

read entire definition

 
 

 

 

Home     About Us    Contact Us     Contribute     Sitemap

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Copyright © 2009 TeenAnalyst.com