I'm Selling All My Shares In A Mutual-Fund. How Do I Understand How Much To Create Aside To Pay For Capital-Gains At Year's End?

[bernie]

I own about $33,000 worth of Third Avenue Worth Fund, TAVFX. I wish to place the money into an additional account, so Iam promoting all my stocks. I want to decrease my tax coverage and make certain I put aside what ever Iam likely to have to spend for at the end of the year to guarantee that I do not have to get unnecessary transaction charges by selling shares of the brand new account at year's end. Please recommend. Thanks!

[mylo26]

[Mac]

Normally speaking, 15% The only way to answer this query precisely would be to know(a) how long you held the shares, from the date of acquire to the date of sale, and(b) your current tax bracket. Assuming that it was a extended-term position and that you happen to be in an average bracket, you happen to be looking at 15% capital gains on the gross proceeds from the sale of the shares, or an unfortunate $4950(Uncle Sam thanks you, although, for what ever that's worth). The normal capital gains tax utilized to be a mindnumbing 20%, but Bush lowered it --- temporarily. In 2011 it goes back to 20%, so at least you can feel great about your further 5% savings. Good luck! Sources: My expertise uncarved 81 months ago Please sign in to give a compliment. Please confirm your account to give a compliment. Please sign in to send a message. Please verify your account to send a message.

[Jediah]

Figure out your cost basis Figure out your cost basis in your shares by adding your cash investments in the fund along with any reinvested dividends you have received over the years.  If you acquired this fund after the early 1990s(and did not move the fund from one account to another) your broker or bank may have already this information figured out for you.  Prior to 1990 or so fund companies didn't necessarily track your cost basis information so you would need to check your year end statements to see how much you received in taxable dividends and capital gains that was reinvested in the fund.  FYI, if your fund gave you any payments that were considered "return of capital" you would actually subtract this amount from your cost basis.  Also, if you recieved dividends from your fund in December of 2006 and you sell now the shares that were purchased in December are short term while anything purchased over a year ago is long term. Once you know your capital gain, you need to see how it impacts your overall tax situation.  Use the worksheet in the 2007 1040-ES packet(http://www.irs.gov/pub/irs-pdf/f1040es.pdf) to see how much you need to pay in Estimated Taxes.  This worksheet will take into account your earned income and tax withholding from your job, any other unearned income like interest and dividends, and it will figure your tax at the appropriate rate for long and/or short term capital gains. Sources: http://www.irs.gov/pub/irs-pdf/f1040es.pdf simsandwich 81 months ago Please sign in to give a compliment. Please verify your account to give a compliment. Please sign in to send a message. Please verify your account to send a message.

[Stockley]

The only way to answer this question precisely would be to know(a) how long you held the shares, from the date of purchase to the date of sale, and(b) your current tax bracket. Assuming that it was a long-term position and that you're in an average bracket, you're looking at 15% capital gains on the gross proceeds from the sale of the shares, or an unfortunate $4950(Uncle Sam thanks you, though, for whatever that's worth). The standard capital gains tax used to be a mindnumbing 20%, but Bush lowered it --- temporarily. In 2011 it goes back to 20%, so at least you can feel good about your extra 5% savings. Good luck!