Short term stock sale tax
Short-term capital gains are gains you make from selling assets that you hold for one year or less. They're taxed like regular income. That means you pay the same tax rates you pay on federal income tax. Long-term capital gains are gains on assets you hold for more than one year. They're taxed at lower rates than short-term capital gains. Your short sale is treated as a constructive sale of an appreciated financial position because a sale of your ABC stock on the date of the short sale would have resulted in a gain. You recognize a $600 short-term capital gain from the constructive sale and your new holding period in the ABC stock begins on September 10. If you owned the stock for more than one year (generally measured from the day after the trade date of the purchase to the trade date of the sale), you would report that gain as a long-term capital gain. Otherwise, you'd report any gain as a short-term capital gain for the year of the sale.