A capital gain is a profit that results from investments into a capital asset
Capital asset
The term capital asset has three unrelated technical definition
Discussion
Ask a question about 'Capital gain'
Start a new discussion about 'Capital gain'
Answer questions from other users
Full Discussion Forum
Encyclopedia
A capital gain is a profit that results from investments into a capital asset
Capital asset
The term capital asset has three unrelated technical definitions, and is also used in a variety of non-technical ways.*In Financial economics, it refers to any Asset used to make money, as opposed to Asset used for personal enjoyment or consumption.... , such as stocks, bonds or real estate, which exceeds the purchase price. It is the difference between a higher selling price and a lower purchase price, resulting in a financial gain for the seller. Conversely, a capital loss
Capital loss
Capital loss is the difference between a lower selling price and a higher purchase price, resulting in a financial loss for the seller. Pursuant to "If your capital losses exceed your capital gains, the excess can be deducted on your tax return, up to an annual limit of $3,000 ."... arises if the proceeds from the sale of a capital asset are less than the purchase price.
Capital gains may refer to "investment income" that arises in relation to real assets, such as property
Property
Property is any physical or virtual entity that is ownership by an individual or jointly by a group of individuals. An owner of property has the right to consumption, sell, Renting, mortgage, transfer and exchange his or her property.... , financial assets, such as shares or bonds
Bond (finance)
In finance, a bond is a debt security , in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest and/or to repay the principal at a later date, termed Maturity .... , and intangible assets such as goodwill
Goodwill (accounting)
Goodwill is an accounting term used to reflect the portion of the book value of a business entity not directly attributable to its assets and liability; it normally arises only in case of an acquisition.... .
A capital gains tax is a tax charged on capital gains, the profit realized on the sale of a non-inventory asset that was purchased at a lower price.... of individuals or corporation
Corporation
A corporation is a legal entity separate from the persons that form it. It is a legal entity owned by individual stockholders. In British tradition it is the term designating a body corporate, where it can be either a corporation sole or a corporation aggregate .... s, although relief may be available to exempt capital gains: in relation to holdings in certain assets such as significant common stock
Common stock
Common stock is a form of corporation equity ownership represented in the Security . It is a stock whose dividends are based on market fluctuations.... holdings, to provide incentives for entrepreneurship
Entrepreneurship
Entrepreneurship is the practice of starting new organizations or revitalizing mature organizations, particularly new businesses generally in response to identified opportunities.... , or to compensate for the effects of inflation
Inflation
In economics, inflation is a rise in the general price level of goods and services in an economy over a period of time. The term "inflation" once referred to increases in the money supply ; however, economic debates about the relationship between money supply and price levels have led to its primary use today in describing price inflatio... .
