I am currently in the U.S. on a work visa.
Say I invest amount x in some stock and gain profit y. Is y the only taxable amount or would it be x+y ? What if there was a loss in selling a stock ?
Second question is a bit more complex. The source (as money) of my investment would be overseas so I will not use my U.S. salary towards stocks. In other words it would not be considered taxable income, however if I use it in trading stocks in the U.S. then I am required to pay the taxes on x+y (or y depending on the answer above) ?
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2 Comments on “Taxes imposed on trading U.S. stocks online?”
MadMan 12th March 2010
You would pay taxes on the gain, so on Y only.
If you have a loss, a certain amount, $3,000, can be used to offset your income. However, it would first be used to offset any gains.
The source of the invested money is irrelevant. You still pay tax only on the gain even if the capital came from overseas money.
v b 12th March 2010
If you are filing a 1040 return (meaning you meet the residency test), you file just like I do. The source of the funds is meaningless. (If you have a $10K bank account in another country, don’t forget to do the form TD F 90-22.1.)
You list the sales. You figure out the gains/losses. You total them. if it’s a gain, you pay. If it’s a loss, you can deduct up to $3000 against other income and carry it forward.