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1.
Sales of art, antiques, gems, and stamps are exempt from capital gains taxes.
False. Collectibles, including art, antiques, gems, and stamps, are subject to capital gains taxes.
2.
Long-term capital gains are taxed at a higher rate than short-term capital gains.
False. Long-term gains are taxed at a lower rate than short-term gains.
3.
The amount of time you hold onto an asset is known as the ________.
Holding period. The holding period is the amount of time you hold onto your asset.
4.
The capital gains tax is a tax on _______.
The increase in value of an investment. This increase is taxed in the year that you realize the gains.
5.
The difference between the original price of an asset and the price you sell it for is known as its _______.
Realized capital gain or loss. The realized gain or loss is the difference between the price at the time you sell it and the original price you paid for it.