Reinvested gains are going to be taxes . . . it
April 2nd, 2007One thing that we see a lot is people assuming just because they made money on an investment and reinvested the gain, they think they will not be taxed on the gain. I can’t tell you how big a mistake that is. If you are involved in the stock market, know this if you know nothing else about investing in Wall Street (or anything else for that matter): If you gain money on your investment, no matter what you do with the gain, you will be taxed on it. Now this is assuming this investment is not in a qualified investment account (IRA, 529 plan, 401K, etc.). You should receive a statement from your broker that clearly states the performance of your investments and be aware that they are compelled by law to report earnings and losses to the IRS.
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IRS Regulations, Tax Alerts, Tax Tips
Posted by johnharris
