Review this article which looks at longterm and shortterm ca

Review this article which looks at long-term and short-term capital gains.  http://taxes.about.com/video/What-Are-Long-Term-and-Short-Term-Capital-Gains-Tax-Rates-.htm

Identify capital assets that exist in your current, past or future job. How does the tax treatment differ on a long-term versus short-term capital gain? What is the tax treatment of net capital losses, including any unused capital losses in a particular year?

Solution

On a business\'s balance sheet, capital assets are represented by the property, plant and equipment figure. Examples include land, buildings and machinery.

Tax treatment

Short term capital asset

Gain realized on asset used for less than one year

This gain is taxed as regular income

E.g if any individual is having income of short term gain than such gain is taxable to him as per applicable slab rate to him

Long term capital asset

It is generally taxed at lower rate than short term gain

Like long term gain is taxed at 15% rate and sometimes it is exempt also when security transaction tax have been paid on which it,

So tax treatment of such gains are differ

Treatment of net capital loss

Such loss would be first set off against gain arising from same head and remaining loss can be carried forward for set off against same head for indefinite year..

Unused capital loss

Unused capital losses can be carried forward forever but are of no use unless capital gains arise in the future

In death, alas there is some relief in that the executor of the deceased can deduct unused or unapplied net capital losses against all income in the deceased’s final return, thus reducing the amount taxes owed. The available net capital loss must be reduced by any capital gain exemption claims by the deceased during his or her lifetime including those that might be made in the year of death.