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Overview of the Tax Treatment of Capital Assets

Overview of the Tax Treatment of Capital Assets

Learn about the general treatment of capital gains and losses under the Internal Revenue Code.

Transcript

In this lesson, we'll survey the federal-tax treatment of capital gains and losses for noncorporate taxpayers. The rules for corporate taxpayers may differ from those we'll discuss here.

In general, capital gains and losses are those gains and losses that arise from the sale or exchange of a capital asset. 26 U.S.C. § 1222. We'll define the terms sale or exchange, and capital asset in other lessons. Here, we'll discuss the rules that come into play once it's determined that a taxpayer has,...