- The Internal Revenue Service (IRS) says that almost everything you own or use for personal or investment purposes is a capital asset
- Your home
- Your car
- Investments like stocks, bonds, and mutual funds
- Ownership interest in a small businesss you started
- Rental or other real estate you own
- When you buy a capital asset, the price you pay is called your basis
- If you sell the asset for more than you paid for it, you will have a capital gain
- If you sell the asset for less than waht you paid for it, you will have a capital loss
- If you sell the asset for what you paid for it (your basis) you will break even on the sale