Basics Beginner: Capital Gains

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
Art may be subject to capital gains taxes when it is sold.
Choose wisely. There is only one correct answer.
True. Some collectibles, such as art, also qualify for capital gains taxes.
2.
The amount you get for selling an asset is known as the basis.
Choose wisely. There is only one correct answer.
False. The amount you get for selling an asset is called the amount realized.
3.
Long-term capital gains are taxed at higher rates than short-term capital gains.
Choose wisely. There is only one correct answer.
False. Long-term gains are taxed at lower rates than short-term gains. This is meant to encourage investors to invest for longer periods.
4.
Long-term capital gains are taxed at a higher rate than short-term capital gains.
Choose wisely. There is only one correct answer.
False. Long-term gains are taxed at a lower rate than short-term gains.
5.
Unrealized gains or losses on your investments must be reported on your tax returns.
Choose wisely. There is only one correct answer.
False. Only realized gains or losses must be reported on your tax returns.