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Profit (or loss) from the sale of a capital asset, such as stock received at a distribution from a nonqualified deferred compensation plan or from restricted stock units with deferral of share delivery. Capital gains may be short-term (held 12 months or less) or long-term (held more than 12 months).
You must file IRS Form 8949 and Schedule D with your federal IRS Form 1040 tax return for any tax year in which you sold stock, regardless of whether or not you have a capital gain. Capital losses can be used to offset capital gains to establish a net position for tax purposes. Only $3,000 of net capital losses can be deducted in any one year, with the remaining balance carried over to future years indefinitely.
The top rate of tax on long-term capital gain depends on your yearly taxable income:
Short-term capital gain is taxed at the rates of wages and other ordinary income.