It is December 10th and you have a stock that you purchased last January 5th, which has increased in value by more than $3,000. You think the stock will not significantly increase or decrease in value over the next month or so, and you would like to take your gain. What should you do?
A) Sell the stock today and take the gain.
B) Wait until December 30th and sell the stock then.
C) Sell the stock on January 6th of next year or later.
D) Do not sell the stock until it starts to go down in value.

Question

Quizplus · Accepted Answer

Selling the stock on January 6th of next year or later allows the gains to be taxed as long-term capital gains, which are typically taxed at a lower rate than short-term capital gains. Since the stock was purchased last January 5th, holding it for at least a year and a day qualifies the gains for long-term capital gains tax treatment.

It Is December 10th and You Have a Stock That