Share your photos by tagging us and using the hashtag #BigGreenEgg.
Want to see how the EGG is made? Click to Watch
Tax question OT
I sold some corporate stock, $10,000, of which $4,000 was held back for taxes, and the balance of $6,000 was paid out.
Do I still have to pay income taxes on the 6,000? Or do I get credit for the 4,000?
How does this work?
XL and MM
Louisville, Kentucky
Comments
-
If someone else knows better, please chime in.
The sale of the stock is a form of income. Either long term (if you held it for at least 1 year) or short term investment income.
The amount of taxable investment income is the total sale price minus the amount of money it cost you to buy and sell it (purchase price and any transaction costs like the brokerage fee).
So, if you bought it for $2000 and paid a $50 brokerage fee on each transaction then your "cost basis" is $2100. That means your income (appropriate term is "captial gain") is $7900.
Short term capital gains are taxed at your regular income tax rate.
Long term gains max out at 20% (I think).
What's not clear to me is who kept your $4000. The government - or your brokerage.
If the government has it then the $4000 will be added to the total taxes you paid and you'll get what you deserve when you file.
I don't what to say about the possibility that your brokerage is holding it.
I hope that helps.XXL BGE, Karebecue, Klose BYC, Chargiller Akorn Kamado, Weber Smokey Mountain, Grand Turbo gasser, Weber Smoky Joe, and the wheelbarrow that my grandfather used to cook steaks from his cattle
San Antonio, TX
-
Foghorn said:If someone else knows better, please chime in.
The sale of the stock is a form of income. Either long term (if you held it for at least 1 year) or short term investment income.
The amount of taxable investment income is the total sale price minus the amount of money it cost you to buy and sell it (purchase price and any transaction costs like the brokerage fee).
So, if you bought it for $2000 and paid a $50 brokerage fee on each transaction then your "cost basis" is $2100. That means your income (appropriate term is "captial gain") is $7900.
Short term capital gains are taxed at your regular income tax rate.
Long term gains max out at 20% (I think).
What's not clear to me is who kept your $4000. The government - or your brokerage.
If the government has it then the $4000 will be added to the total taxes you paid and you'll get what you deserve when you file.
I don't what to say about the possibility that your brokerage is holding it.
I hope that helps."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
@Foghorn - I followed that even on a Sat night and am glad you posted as I was thinking about trying to provide an answer. Sounds like a side interest for you.
And I am all in with give 'em what you owe, but drive the "owe" to as low as you can. If questionable interpretation, then I always side in my favor.
Most times that works out but I have been on the wrong side of that approach in the past. I did not win the final debate. FWIW-
Louisville; Rolling smoke in the neighbourhood. # 38 for the win. Life is too short for light/lite beer! Seems I'm livin in a transitional period. -
Seems to me you paid the $4,000 as taxes on the $10,000 sale. The $6,000 is net to you after taxes.Mountain View, CA
-
lousubcap said:@Foghorn - I followed that even on a Sat night and am glad you posted as I was thinking about trying to provide an answer. Sounds like a side interest for you.
And I am all in with give 'em what you owe, but drive the "owe" to as low as you can. If questionable interpretation, then I always side in my favor.
Most times that works out but I have been on the wrong side of that approach in the past. I did not win the final debate. FWIW-
It is just amazing to me every year how much of a tax burden we have. Takes a lot to make America great."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
You’ve already started doing your taxes??#1 LBGE December 2012 • #2 SBGE February 2013 • #3 Mini May 2013A happy BGE family in Houston, TX.
-
@YukonRon - I will offer that situation dependent, a good tax accountant will more than pay for their fees every year. My little hic-cup was prior to that revelation. I have been with the same practice (long distance now) for over 20 years. FWIW-
Louisville; Rolling smoke in the neighbourhood. # 38 for the win. Life is too short for light/lite beer! Seems I'm livin in a transitional period. -
@caliking - when you know you're gonna owe, it's nice to know about how much. But I always ask for the damages Mon-Weds at the latest. Don't want to totally ruin the weekend.Louisville; Rolling smoke in the neighbourhood. # 38 for the win. Life is too short for light/lite beer! Seems I'm livin in a transitional period.
-
caliking said:You’ve already started doing your taxes??
Tou will find me sometime during the day on the 15th, standing in line at HR Block.
"Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
YukonRon said:caliking said:You’ve already started doing your taxes??
Tou will find me sometime during the day on the 15th, standing in line at HR Block.
“Reality is that which, when you stop believing in it, doesn't go away.” ― Philip K. Diçk -
YukonRon said:lousubcap said:@Foghorn - I followed that even on a Sat night and am glad you posted as I was thinking about trying to provide an answer. Sounds like a side interest for you.
And I am all in with give 'em what you owe, but drive the "owe" to as low as you can. If questionable interpretation, then I always side in my favor.
Most times that works out but I have been on the wrong side of that approach in the past. I did not win the final debate. FWIW-
It is just amazing to me every year how much of a tax burden we have. Takes a lot to make America great.
Me? I like a strong defense. I like good roads. Good schools that educate our kids so they can fine a place in the undeniably global economy? Sign me up — I’ll gladly pay for that. Is there waste? Of course. Any system can be and will be gamed. The question is, can you trust the folks with their hands on the levers, turning the dials, fingers in the till?
Don’t know about you (or others) but I’ve got a SICK tax cut coming. Like crazy sick. Personal cut, cut from what my investments are doing, and stock buybacks from the corporate cut. I’m not Warren Buffet, but I am struck by his words: “I don’t need it, I don’t want it!” But he’s getting it, I’m getting it, and so many who NEED it are not.
I’ll make it right, or try to — upping charitable giving and reinvestment in my community. Many beneficiaries of the rich-folks’ windfall won’t. And that ain’t right. The system ain’t right. Just sayin’
#saturdaynightpost
#timetoeggIt's a 302 thing . . . -
HeavyG said:YukonRon said:caliking said:You’ve already started doing your taxes??
Tou will find me sometime during the day on the 15th, standing in line at HR Block.
Bow to the master..."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
The extension is all good but if you owe $$ you will also owe interest on the $$. You become a bank for the gubmint. Just sayin...Louisville; Rolling smoke in the neighbourhood. # 38 for the win. Life is too short for light/lite beer! Seems I'm livin in a transitional period.
-
lousubcap said:The extension is all good but if you owe $$ you will also owe interest on the $$. You become a bank for the gubmint. Just sayin..."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
Foghorn said:If someone else knows better, please chime in.
The sale of the stock is a form of income. Either long term (if you held it for at least 1 year) or short term investment income.
The amount of taxable investment income is the total sale price minus the amount of money it cost you to buy and sell it (purchase price and any transaction costs like the brokerage fee).
So, if you bought it for $2000 and paid a $50 brokerage fee on each transaction then your "cost basis" is $2100. That means your income (appropriate term is "captial gain") is $7900.
Short term capital gains are taxed at your regular income tax rate.
Long term gains max out at 20% (I think).
What's not clear to me is who kept your $4000. The government - or your brokerage.
If the government has it then the $4000 will be added to the total taxes you paid and you'll get what you deserve when you file.
I don't what to say about the possibility that your brokerage is holding it.
I hope that helps.
I know in my own case I have signed off on that agreement in effect with my brokers as I will assume any tax liability thus specifically holding them harmless for not withholding any potential tax liability.Re-gasketing America one yard at a time. -
This is a great thread, thank you RRP."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
We wrote our check this morning. We kinda mis-calculated after selling both houses last year. Needless to say it's been a both a learning experience and a rough go the last two months.Slumming it in Aiken, SC.
-
Jeremiah said:We wrote our check this morning. We kinda mis-calculated after selling both houses last year. Needless to say it's been a both a learning experience and a rough go the last two months.
Best of luck."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
HendersonTRKing said:YukonRon said:lousubcap said:@Foghorn - I followed that even on a Sat night and am glad you posted as I was thinking about trying to provide an answer. Sounds like a side interest for you.
And I am all in with give 'em what you owe, but drive the "owe" to as low as you can. If questionable interpretation, then I always side in my favor.
Most times that works out but I have been on the wrong side of that approach in the past. I did not win the final debate. FWIW-
It is just amazing to me every year how much of a tax burden we have. Takes a lot to make America great.
Me? I like a strong defense. I like good roads. Good schools that educate our kids so they can fine a place in the undeniably global economy? Sign me up — I’ll gladly pay for that. Is there waste? Of course. Any system can be and will be gamed. The question is, can you trust the folks with their hands on the levers, turning the dials, fingers in the till?
Don’t know about you (or others) but I’ve got a SICK tax cut coming. Like crazy sick. Personal cut, cut from what my investments are doing, and stock buybacks from the corporate cut. I’m not Warren Buffet, but I am struck by his words: “I don’t need it, I don’t want it!” But he’s getting it, I’m getting it, and so many who NEED it are not.
I’ll make it right, or try to — upping charitable giving and reinvestment in my community. Many beneficiaries of the rich-folks’ windfall won’t. And that ain’t right. The system ain’t right. Just sayin’
#saturdaynightpost
#timetoegg
I'm getting a cut too and I need it.....desperately. Feel free to pay more than you owe since you seemed disillusioned with your cut. As I remember, there's a line for just that on your return.As for the OP, hire an experienced local tax person. Ask around to friends, neighbors or coworkers. I found mine about 7-8 years ago and has saved me tons. As another poster mentioned, my only regret was not finding one sooner. And also file for an extension. Unless you owe a ton, the interest is minimal.
LBGE
Cedar table w/granite top
Ceramic Grillworks two-tier swing rack
Perpetual cooler of ice-cold beer
-
@KennyLee
I do not owe, just amazed how much we paid on the Fed side.....and glad to pay it.
Kind of a gee whiz moment, we are ok."Knowledge is Good" - Emil Faber
XL and MM
Louisville, Kentucky -
KennyLee said:HendersonTRKing said:YukonRon said:lousubcap said:@Foghorn - I followed that even on a Sat night and am glad you posted as I was thinking about trying to provide an answer. Sounds like a side interest for you.
And I am all in with give 'em what you owe, but drive the "owe" to as low as you can. If questionable interpretation, then I always side in my favor.
Most times that works out but I have been on the wrong side of that approach in the past. I did not win the final debate. FWIW-
It is just amazing to me every year how much of a tax burden we have. Takes a lot to make America great.
Me? I like a strong defense. I like good roads. Good schools that educate our kids so they can fine a place in the undeniably global economy? Sign me up — I’ll gladly pay for that. Is there waste? Of course. Any system can be and will be gamed. The question is, can you trust the folks with their hands on the levers, turning the dials, fingers in the till?
Don’t know about you (or others) but I’ve got a SICK tax cut coming. Like crazy sick. Personal cut, cut from what my investments are doing, and stock buybacks from the corporate cut. I’m not Warren Buffet, but I am struck by his words: “I don’t need it, I don’t want it!” But he’s getting it, I’m getting it, and so many who NEED it are not.
I’ll make it right, or try to — upping charitable giving and reinvestment in my community. Many beneficiaries of the rich-folks’ windfall won’t. And that ain’t right. The system ain’t right. Just sayin’
#saturdaynightpost
#timetoegg
I'm getting a cut too and I need it.....desperately. Feel free to pay more than you owe since you seemed disillusioned with your cut. As I remember, there's a line for just that on your return.As for the OP, hire an experienced local tax person. Ask around to friends, neighbors or coworkers. I found mine about 7-8 years ago and has saved me tons. As another poster mentioned, my only regret was not finding one sooner. And also file for an extension. Unless you owe a ton, the interest is minimal.
As for picking an accountant, there is a spectrum of philosophies. One end of the spectrum believes that if you don't get audited every year then they are pushing the envelope far enough. Like others, I don't mind paying my share of taxes. As a result, my accountant is from the other end of the spectrum. He is extremely conservative. I'm pretty sure that if I get audited, I will be owed money. As a result, I sleep well.XXL BGE, Karebecue, Klose BYC, Chargiller Akorn Kamado, Weber Smokey Mountain, Grand Turbo gasser, Weber Smoky Joe, and the wheelbarrow that my grandfather used to cook steaks from his cattle
San Antonio, TX
-
I find if you never file, then there is nothing to audit.A bison’s level of aggressiveness, both physical and passive, is legendary. - NPS
-
Excuse me for saying so, but rather than ask a bunch of drunken, well-meaning screw balls you've never met important legal tax advice, perhaps a safer course of action is to have reserved a bit of the $6K and paid a reputable cpa for advice? Am I the only one thinking this?Flint, Michigan
-
Fred19Flintstone said:Excuse me for saying so, but rather than ask a bunch of drunken, well-meaning screw balls you've never met important legal tax advice, perhaps a safer course of action is to have reserved a bit of the $6K and paid a reputable cpa for advice? Am I the only one thinking this?A bison’s level of aggressiveness, both physical and passive, is legendary. - NPS
-
Pretty decent explanation from foghorn, but that 40% seems excessively high; backup withholding is generally 28%. When you say corporate stock, is that a regular stock purchase or is this restricted stock/stock option, because then you potentially have other issues to deal with.
-
Ozzie_Isaac said:Fred19Flintstone said:Excuse me for saying so, but rather than ask a bunch of drunken, well-meaning screw balls you've never met important legal tax advice, perhaps a safer course of action is to have reserved a bit of the $6K and paid a reputable cpa for advice? Am I the only one thinking this?Flint, Michigan
-
I can see @YukonRon is going to be paying for advice with rubs or brisket or something.Flint, Michigan
-
That wasn't tax advice, just a pointer in the right direction. You sign your own name on your taxes or have your preparer do so for you. Buck stops there.Mountain View, CA
-
The taxes should be based on short term vs long term gains/covered vs. non-covered tax lots etc. I work with brokerage/managed accounts, but i'm not a tax professional. Happy to explain brokerage account activity, but IMO you can't put a price on a good CPA.
Categories
- All Categories
- 182.7K EggHead Forum
- 15.7K Forum List
- 459 EGGtoberfest
- 1.9K Forum Feedback
- 10.3K Off Topic
- 2.2K EGG Table Forum
- 1 Rules & Disclaimer
- 9K Cookbook
- 12 Valentines Day
- 91 Holiday Recipes
- 223 Appetizers
- 516 Baking
- 2.4K Beef
- 88 Desserts
- 163 Lamb
- 2.4K Pork
- 1.5K Poultry
- 30 Salads and Dressings
- 320 Sauces, Rubs, Marinades
- 543 Seafood
- 175 Sides
- 121 Soups, Stews, Chilis
- 35 Vegetarian
- 100 Vegetables
- 312 Health
- 292 Weight Loss Forum