capital-gains

Vocabulary Word

Definition

'Capital gains' involve selling something, like a house or stocks, for more than what you paid for it. It's the financial gain you make between the price you sell something for and the price you bought it for.

Examples in Different Contexts

In tax planning, managing 'capital gains' is crucial for minimizing tax liabilities. A tax consultant might advise, 'Strategic selling of assets can help in reducing taxes on capital gains.'

Practice Scenarios

Tech

Scenario:

The value of our company equity has been skyrocketing. We may need to reevaluate our financial strategy.

Response:

I agree, we could leverage the capital gains from our equity to fund our next project.

Accounting

Scenario:

This year we've had a substantial profit on selling our assets. We need to optimize our tax strategy.

Response:

Let's consider a tax strategy that minimizes our capital gains tax liability.