Short Term Capital Gains Tax for 2011, 2012

The amount investors are taxed depends on both the tax bracket they fall into and the amount of time the investment was held before being sold. Short-term capital gains are defined by investments that are held for a year or less before being sold. Short-term capital gains tax is calculated at the investor's regular income tax rate.

Since Short-term capital gains refer to a shorter holding period of a year or less, you can expect to pay a higher tax rate. Short-term capital gains tax rates can be a maximum of 35%. You could expect to pay a short-term capital gains tax on the following assets:

• Stocks
• Bonds
• Mutual Funds Shares
• Real Estate

If you happen to have a loss by property you sold or if you lost money in stocks you could apply the loss to other capital gains.

If you own the investment asset for more than a year you would not be assessed a short-term capital gains tax but rather a long-term capital gains tax which is assessed a much lower tax rate.

Determining exactly how much tax you could be responsible for and whether your capital gains falls in the long-term or short-term capital gains tax may be time consuming and confusing. I would suggest using on online tax software program such as TurboTax that will estimate the tax due for you.

TurboTax offers free, online calculators to estimate certain taxes you may be responsible for per your tax situation and bases the information on your income and personal exemptions. They also offer tax professionals 24 hours a day, 7 days a week to answer any tax-related question you may have.

Through TurboTax, you are guaranteed that your return will be 100% accurate; this also reduces your risk of being audited by the IRS.

For more information on long-term and short-term capital gains tax, visit TurboTax Online today.