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1.
Short-term assets are assets held _______ month(s) or fewer.
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Twelve. This has implications for taxation.
2.
Art may be subject to capital gains taxes when it is sold.
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True. Some collectibles, such as art, also qualify for capital gains taxes.
3.
Unrealized gains or losses on your investments must be reported on your tax returns.
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False. Only realized gains or losses must be reported on your tax returns.
4.
You have a capital loss on an investment if your amount realized is less than your basis.
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True. The amount realized is what you earn from a sale, and the basis is what you paid for it.
5.
The capital gains tax is a tax on _______.
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The increase in value of an investment. This increase is taxed in the year that you realize the gains.