The idea
When you sell something for more than you paid, that profit is called a capital gain — and the government usually takes a small slice as tax. Here's the cool part: if you hold an investment for more than a year before selling, the tax bite is much smaller. So patience doesn't just grow your money, it can also lower your taxes. 🧾
Words to know
- Capital gain
- The profit you make when you sell an investment for more than you paid.
- Capital gains tax
- The tax you owe on that profit when you sell.
- Short-term vs long-term
- Held under a year = taxed more; held over a year = taxed less.
- Roth IRA
- A special account where investment gains are never taxed.
- Tax-loss harvesting
- Selling a losing investment so the loss can lower the tax on your gains.
- Income bracket
- The tax rate that applies to your income; short-term gains are taxed at this rate.
Try it — no account needed
Match each timeline to how the IRS taxes your gains.
0 / 4 matched
In the full lesson
- 1Match the pairs
Vine has 107 lessons like this one, each written three ways so a 7-year-old and a 17-year-old both get a version that fits.
Practice with real prices
Real market data, pretend money. Learn how investing actually works without risking a cent.
Start free