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Taxes

capital gains tax

Capital gains tax is a tax on income received from the sale of an asset—such as a business, real estate, your home, stocks, bonds, coin collections, and jewelry. Capital gains tax is paid on the financial gain between the amount you paid for (or invested to build) the asset, and the amount for which it is sold.

The rate (percentage) paid as capital gains tax has traditionally been lower than the rate (percentage) paid on income tax. And the Internal Revenue Service (IRS) has traditionally taxed long term gains differently than short term gains—with the distinction based on how long the taxpayer owned or held the asset.

In Alaska (AK), there is no state-level capital gains tax, as Alaska does not have a state income tax. Therefore, residents of Alaska are only subject to federal capital gains taxes on the sale of assets such as businesses, real estate, stocks, and other investments. The federal capital gains tax rates vary depending on the taxpayer's income level and the length of time the asset was held. Long-term capital gains, which apply to assets held for more than one year, are taxed at lower rates than short-term capital gains, which apply to assets held for one year or less. These federal rates are indeed typically lower than the federal income tax rates. Taxpayers in Alaska must report and pay these taxes to the Internal Revenue Service (IRS) when filing their federal tax returns.

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Taxes

capital gains tax

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Taxes

capital gains tax

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