Q & A
I invested in my former place of employment, a privately held company. They recently announced that they have filed for an IPO. Once the company goes public, am I taxed at a capital-gains rate or at my full income-tax rate? Also, as a former employee, can I withdraw the funds immediately, or is there a waiting period?
Answer: The Initial Public Offering does not trigger any taxation. Taxes only apply when you sell the shares. Any gains over your cost-basis are taxed as capital gains. If you sell shares you have owned for less than 12 months for a profit, those gains are categorized as short-term gains. More than 12 months is considered long term. Read more…
Source: Dan Moisand, www.moisandfitzgerald.com, via www.marketwatch.com - 8-10-2015
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