All Things Tax

All Things Tax

Like the title says, from the filing process and tax questions to tax policy and reform, you can search and share All Things Tax here. This is the place to find answers to all your general questions that don't fall under the other categories. And just a reminder: questions about software or online filing should be posted in DIY Products.

Posts: 2
Registered: ‎03-01-2018

Paying stock taxes?

Hi everyone,

I was wondering about tax on stocks. Let's say I invest $30,000 in stocks. I make only $5,000 for the year. I know I will be taxed either short or long term tax rate for the $5,0000 capital gain. However, will I only get taxed on the capital gain for the year or includes being taxed on the $30,000 as well for investing? So total taxes will be taxed on the $35,000? I am guessing that's wrong because I assume only on the captial gain gets taxed.
Associate (Neighbor)
Posts: 150
Registered: ‎07-22-2014

Re: Paying stock taxes?

Hello, bsantos248, and welcome to the community.


Your final statement is correct - you will be taxed only on the gains from your stock trades.  The forms that are used to report stock sales have three numbers that are important (in addition to the dates bought and sold):  the proceeds from the sale, what the stock cost, and the net gain (or loss) from the sale.  Of those three, the only one that really matters is the last one - your net gain or loss.


Hope that helps clear things up!