Equity Tax Treatment: Rapid Fire
Chapters in this video
- 0:00 The 366-day long-term threshold trap
- 1:37 Netting capital gains: cage-match rules
- 2:48 Capital-loss caps and indefinite carryforward
- 3:12 Qualified dividends and the 60-day test
- 3:35 Wash-sale window: 30 days before to 30 days after
- 4:58 Inherited step-up vs. gifted carryover basis
- 6:28 Corporate actions and cost-basis adjustments
- 7:15 FIFO default and the rising-market gain trap
- 7:37 Rapid-fire exam recap
What this video covers
- Why exactly one year is still short-term and why 366 days is the magic long-term threshold
- The three-step netting hierarchy: net short-term vs. short-term, long-term vs. long-term, then across categories, with the survivor taking the larger side's character
- How qualified dividends earn preferential 0%, 15%, or 20% rates through the "more than 60 days in the 121-day window" test
- Why the wash-sale loss is merely deferred in a taxable account but permanently lost when the repurchase lands inside an Individual Retirement Account (IRA)
- What "substantially identical" means for wash-sale purposes (call options yes, same-industry stock no) and how to calculate the 61-day window
- The stepped-up basis at death and why inherited stock is always long-term, versus the dual-basis trap for depreciated gifts
- How FIFO lot identification works in a rising market and why it produces the largest gain compared to Last In, First Out (LIFO)
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