#capital-gains
Track and report capital gains from investments
A practical guide to Section 302 stock redemptions in closely-held C corporations — when a buyback gets capital gain treatment versus dividend treatment, how Section 318 family attribution disqualifies most family redemptions, and how the four 302(b) tests plus the 302(c)(2) waiver preserve sale treatment.
US direct indexing harvests losses stock-by-stock in an SMA — wash-sale rules and tax alpha ETFs cannot match in 2026.
A practical guide to Section 453 installment sales and Form 6252 — how the gross profit ratio defers capital gains across years, when depreciation recapture forces year-one recognition, how the Section 453A interest charge applies above the $5 million threshold, and when electing out beats deferral.
A practical walk-through of reporting installment sales on Form 6252 under IRC Section 453 — computing the gross profit percentage, why depreciation recapture is taxed in year one, the 453A interest charge on notes above the $5M aggregate threshold, the two-year related-party resale rule, and when electing out beats deferring gain.
When a partner sells an LLC or partnership interest, Section 751 can recharacterize a large share of the gain as ordinary income taxed up to 37 percent. Form 8308 is the partnership's required disclosure of that hot-asset gain on Form 1065, with a January 31 furnishing leg and a return-due-date filing leg in 2026.
Selling a partnership interest can convert expected capital gain into ordinary income under Section 751, raising the federal tax bill on the recharacterized slice from 23.8 percent to 37 percent. This guide explains Form 8308, hot-asset categories, the January 31 partner statement deadline, and what sellers, buyers, and partnership administrators need to do for 2025 and 2026 transfers.
Section 877A treats covered expatriates as if they sold every asset the day before leaving the United States. For 2026 the net-tax threshold is $211,000, the net-worth test sits at $2 million, and the gain exclusion is $910,000 — here is how Form 8854 decides whether you pay.
Personal goodwill carve-outs let C-corporation shareholders pay 23.8% capital gains instead of 40%+ combined tax on a portion of an asset sale. Martin Ice Cream, Norwalk, and Bross Trucking show when the allocation survives; Howard shows when an employment-and-noncompete agreement quietly destroys it.
Personal goodwill, anchored in the Martin Ice Cream and Norwalk Tax Court decisions, lets closely held C corporation owners shift a portion of an asset-sale price out of the corporate tax layer and onto the shareholder as long-term capital gain. This guide explains the doctrine, when it works, the documentation that survives an IRS audit, and the mistakes that have sunk allocations.
A practical guide to Section 1015 carryover basis versus Section 1014 stepped-up basis, the dual basis trap for depreciated assets, and the 2026 decision framework for whether to gift appreciated property now or hold until death under the permanent $15 million exemption.
Section 1256 splits gains on futures, broad-based index options, and qualifying forex 60% long-term and 40% short-term, capping the top federal rate near 26.8% versus 37% on equity options. A 2026 guide to Form 6781, the mark-to-market rule, and the three-year loss carryback.
Trusts hit the top 37% federal bracket at just $15,200 of taxable income, while a single individual does not until $609,350. This guide walks fiduciaries through Form 1041, distributable net income (DNI), Schedule K-1 allocations, the separate share rule, and the 65-day election used to shift income to beneficiaries at lower rates.
