A new month means five new housing vocabulary!
What are capital gains?
Capital gains are profits made from the sale of real estate, investments and personal property. The Internal Revenue Service (IRS) classifies capital gains according to the length of time the taxpayer owned the property. Short-term capital gains refer to profits made from selling assets owned for one year or less, while profits earned on assets owned for more than one year are considered long-term capital gains.
Although many people associate the term with stocks and bonds, capital assets are anything an individual owns and uses for personal and investment purposes. This includes houses, furniture, coin collections, precious metals and jewelry.