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Important
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For information call now:
(347) 989-4566
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Additional information
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Internal Revenue Service
Austin Service Center
ITIN Operation
P.O. Box 149342
Austin, TX 78714-9342
IN
1-800-829-1040
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Sales or Exchanges of Capital Assets
These rules apply only to those capital gains and losses from sources in the
United States that are not
effectively connected with a
trade or business in the United States. They apply even if you are engaged
in a
trade or business in the United States. These rules do not apply to the sale
or exchange of a U.S. real property interest or to the sale of any property that
is effectively connected with a trade or business in the United States (see
Real Property Gain or Loss).
A capital asset is everything you own except:
� Inventory.
� Business accounts or notes receivable.
� Depreciable property used in a trade or business.
� Real property used in a trade or business.
� Supplies regularly used in a trade or business.
� Certain copyrights, literary or musical or artistic compositions, letters or
memoranda, or similar property.
� Certain U.S. government publications.
� Certain commodities derivative financial instruments held by a commodities
derivatives dealer.
� Hedging transactions.
A capital gain is a gain on the sale or exchange of a capital asset. A capital
loss is a loss on the sale or exchange of a capital asset.
If the sale is in foreign currency, for the purpose of determining gain, the
cost and selling price of the property should be expressed in U.S. currency at
the rate of exchange prevailing as of the date of the purchase and date of the
sale, respectively.
The following gains are subject to the 30% (or lower treaty) rate without regard
to the
183-day rule, discussed later.
1. Gains on the disposal of timber, coal, or domestic iron ore
with a retained economic interest.
2. Gains on contingent payments received from the sale or
exchange of patents, copyrights, and similar property after October 4, 1966.
3. Gains on certain transfers of all substantial rights to, or
an undivided interest in, patents if the transfers were made before October 5,
1966.
4. Gains on the sale or exchange of original issue discount
obligations.
Gains in (1) are not subject to the 30% (or lower treaty) rate if you choose to
treat the gains as effectively connected with a U.S. trade or business.
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