What Taxes Do You Owe on Your Investments?

March 27, 2009

Tax day is quickly approaching and so is the IRA contribution deadline, April 15th. If you haven’t funded your IRA or Roth IRA for last year, time is growing short.  Vanguard is always a good option with lots of funds to choose from and Etrade is offering 100 free trades if you open a new IRA account.

But why should you open an individual retirement account at all? How does it help with your investment taxes?  To answer a lot of the investing tax questions that came up in our investing survey I’ve worked with a friend of mine who’s a tax attorney to put together an investor’s tax guide.

Investor’s Tax Guide

This is typically the busiest time of the year for tax attorneys so I want to thank my friend for taking time out of his busy schedule to work with me on this resource.  I think it will be a useful overview for those of you with questions concerning investing and taxes. 

The guide is broken up into three parts; the first takes a look at interest income, dividend income, & capital gains and how they are taxed.  It covers short term vs long term gains, stock basis, investment losses, tax rates, and some tax forms. 

The next section discusses how you can defer taxes on your investments with a variety of retirement plans and 529 plans.

Tracking and reporting on your investment returns is the final section.  It takes a look at tracking your stock basis and reporting capital gains and dividend & interest income.

Downloading the Tax Guide

We’re putting the finishing touches on the investor’s tax guide right now; look for a post over the weekend or on Monday about how you can download it for free!

Update: Instructions on how to download the Investor’s Tax Guide


Will this article help you save or earn more money? Get others like it simply by entering your email address below. Your email is used only for delivering daily money tips and you can opt out of delivery at any time. Click here to see all your free subscription options.


Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

All posts by


6 Responses to What Taxes Do You Owe on Your Investments?


  • –› Cashbaq, Housing, and a New Schedule
  • Friday Finance Findings for April 3rd : Generation X Finance
  • Tax Advice on Unemployment Income, Self Employed, Home Office Tax Deduction, More | Rate Nerd
  • Investor’s Tax Guide 2009 | Money Smart Life