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Gains & Losses

Businesses often own capital assets.   They include all kinds of property, movable or immovable, tangible or intangible, fixed or circulating. Thus, land and building, plant and machinery, motorcar, furniture, jewelry, route permits, goodwill, tenancy rights, patentstrademarkssharesdebenturessecurities, units, mutual fundszero-coupon bonds etc. are capital assets.

In the United States, gains and losses from capital assets are treated differently than other income. Sale of non-capital assets, such as inventory or stock of goods held for sale, generally is taxed in the same manner as other income. Capital assets generally include those assets outside the daily scope of business operations. The United States system defines a capital asset by exclusion.  Capital assets include all assets except inventory of supplies or property held for sale (including subdivided real estate), depreciable property used in a business, accounts or notes receivable, certain commodities derivatives and hedging items, and certain copyrights and similar property held by the creator of the property.

Gains or Losses on the sale or disposal of capital assets may or may not be taxable and or deductible. Please consult your tax professional to understand the tax implications of any sale or disposition of business assets.