Definition
Profits from selling assets held one year or less, taxed at ordinary income tax rates (up to 37%).
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Short-term gains are taxed as ordinary income, making sales within 1 year much more expensive tax-wise. Strongly avoid short-term trading.
Pro Tip
Avoid short-term sales; waiting 1+ year saves enormous taxes through preferential rate treatment.
Example
Selling investment property held 8 months with $100,000 gain taxed at 37% ordinary rate instead of 15% long-term rate.