Capital Gain for Dummies
noun
pronunciation: 'kæpɪtəl_geɪnWhat does Capital Gain really mean?
Hey there! So, "capital gain" is a term that's used in finance, and it's actually not as complicated as it might sound. Let me break it down for you.
Okay, imagine you have some money and you use that money to buy something, like maybe some stocks or a piece of property. Now, let's say that the value of whatever you bought goes up over time. When you eventually sell that thing for more money than you originally paid for it, the profit you make from the sale is called the "capital gain."
So, basically, it's like earning money from an investment because the value of what you invested in has gone up. And when you sell it, you make a gain, hence the term "capital gain."
There are actually two types of capital gains: short-term and long-term. Short-term capital gains are from assets that you've owned for a year or less, while long-term capital gains are from assets that you've owned for more than a year. The main difference between them is how they're taxed, with long-term capital gains usually being taxed at a lower rate.
So, to sum it up, "capital gain" is the profit you make from selling an investment for more than what you originally paid for it. It's like making a little extra cash from something that you put your money into. Cool, right?
Okay, imagine you have some money and you use that money to buy something, like maybe some stocks or a piece of property. Now, let's say that the value of whatever you bought goes up over time. When you eventually sell that thing for more money than you originally paid for it, the profit you make from the sale is called the "capital gain."
So, basically, it's like earning money from an investment because the value of what you invested in has gone up. And when you sell it, you make a gain, hence the term "capital gain."
There are actually two types of capital gains: short-term and long-term. Short-term capital gains are from assets that you've owned for a year or less, while long-term capital gains are from assets that you've owned for more than a year. The main difference between them is how they're taxed, with long-term capital gains usually being taxed at a lower rate.
So, to sum it up, "capital gain" is the profit you make from selling an investment for more than what you originally paid for it. It's like making a little extra cash from something that you put your money into. Cool, right?
Revised and Fact checked by Mike Johnson on 2023-11-13 18:58:06
Capital Gain In a sentece
Learn how to use Capital Gain inside a sentece
- When you sell a stock for more money than you paid for it, that's a capital gain.
- If you bought a house for $200,000 and then sold it for $250,000, you would have a capital gain of $50,000.
- If you bought a piece of artwork for $1,000 and then sold it for $2,000, you would have a capital gain of $1,000.
- When you sell an investment property for more than you paid for it, that's a capital gain.
- If you bought a vintage car for $10,000 and later sold it for $15,000, you would have a capital gain of $5,000.
Capital Gain Hypernyms
Words that are more generic than the original word.