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Recognized Vs. Realized Gains

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fahmidaemran:
Recognized Vs. Realized Gains
When you sell an asset, you may face federal income tax liability if you earn a profit. The Internal Revenue Service makes a distinction between recognized gains and realized gains. While a recognized gain may create a tax liability, the realized gain often determines the amount of tax you must pay. The IRS taxes capital gains earned from the majority of assets, but profits from certain assets may include tax exclusions.

source: https://smallbusiness.chron.com/recognized-vs-realized-gains-25871.html

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