Iowa Insurance Division Iowa State University Extension Investor Protection Trust


The bottom line for short- and long-term gains and losses

Radio Transcript, 60 seconds, for use during week of Jan. 21.

This is an Invest Wisely minute brought to you by Iowa State University Extension.

If you sold assets in 2007 and have both short- and long-term gains or losses to pay taxes on… here’s how you get to the bottom line.

First subtract long-term losses from long-term gains. Then subtract short-term losses from short-term gains. If both of these are gains, the amounts will each be taxed at their appropriate rate.

However, if you have a long-term gain and a short-term capital loss, the loss is subtracted from the gain.  

For example, if you have a $5,000 long-term capital gain and a $4,000 short-term capital loss, the net value of $1,000 is what will be taxed.

Invest Wisely comes from Iowa State University Extension through a grant from the Investor Protection Trust providing investor education on the web at




Updated January 28, 2008