LogFAQs > #971258981

Tom_Joad posted...

Yep. At least, that's how the tax laws work in the US. I tried out the stock market in the US for a year... and found out that I had to pay taxes on all the money gained from a stock sale (without being able to subtract the initial cost of the stock itself). After that, I stopped trading.

You're taxed on capital gains in the US, not the entire cost of the stock. If you buy at 100 and sell at 150, your capital gains = 50, and you're taxed on that amount. The amount you're taxed on that amount would change depending on whether it's a short or long term profit.

When you file, you're supposed to enter the amount you bought at and the amount you sold at in the boxes to calculate your total capital gains on a particular sale.