According to the recent article written by Ted Bauman, despite a significant drop experienced by investors at the beginning of this month, there are those who have made a considerable profit in the stock market this year. For instance, pharmaceutical stocks as well as specific small-cap technology recorded up to 2000 percent early this year to their top in mid-September.
Some people still hold those stocks, but there have been convincing arguments to sell. One is the continuous suffering of small-cap not forgetting the rest of the market. It may be advisable to take the gain and think of reinvesting in those position in future. However, Ted Bauman argues that tax is another reason to put into consideration harvesting gains.
The capital gain tax system can appear confusing but most important thing is the realization of gains and paying taxes on them. If anyone holds a stock for a period less than 12 months, then rates for paying taxes is the same as that one of an ordinary income.
Nevertheless, a recent little-known change to the tax code has given a great opportunity where one will be able to take gains while paying no tax on them and take advantage of those gains to make more money.
Ted Bauman continues to explain further by pointing out that the most investment to benefit from this tax benefits is such as development in real estate and businesses including stores and technology startups.
The investors are advised to start with the real estate as the initial investment because the faster they get going they much they save in taxes. Real estate is believed to be one of the investments that can bring a lot of profit within a short time. To qualify; real estate investments must be developments focusing on major rehabilitation of the existing property.
Ted Bauman joined the team at Banyan Hill Publishing back in the year 2013 where he serves as an editor. Ted Bauman was born in Washington, D.C. and he was brought up on the eastern shore of Maryland. Ted is an alumnus of the University of Cape Town where he received degrees in Economics and History.
Ted Bauman’s Facebook Page