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These gains don't cause pain. A capital gain is the amount of money you pocket by selling one of your investments for more than you paid for it. Technically, capital gains only count for what's called a capital asset, but that's really just anything you own for investment purposes. Stocks and bonds obviously qualify, but your house and household furnishings can also count.
For tax purposes, capital gains are classified as either long-term (held for more than one year) or short-term (held for less than one year) and there are different tax implications for how long you hold onto a capital asset. For most long-term capital gains, you're taxed no more than 15% of the value of the asset. Short-term gains get taxed as regular income, so you pay the rate for the tax bracket you're in.
Capital gains can also be realized or unrealized. When you physically sell an asset like a stock, you've realized the capital gain. When you're holding the stock, and it has a value over its purchase price, but you're not selling it, you've got an unrealized gain, and you won't realize it until you sell.
In a perfect world, we'd all have capital gains. But no one¿s that smart or lucky. When the value of an asset at sale is below what you've paid for it, it's called a capital loss. The good news is that the government lets you count that loss against any gains you've had, lowering the taxes you pay. In fact, many people who sell a stock that has risen far over their purchase price tend to sell some stinkers, too, at the same time for the tax benefit. This is known as a capital-loss offset.
Home / Personal Finance / On Topic / Gadgets
Monday, July 14, 2008
Blast Your Music, With a $20K MP3 Player
Adam Samson
FOXBusiness
What is wrapped in gold, studded with diamonds and plays your favorite tunes?
No, it’s not your favorite rapper -- it is actually an MP3 player and one of the latest in conspicuous spending among the world’s wealthiest individuals.
The i.Beat Organix Gold digital music player is touted by its manufacturer as “the world’s most expensive MP3 player.” Set in 18 carat gold and dotted with 63 one carat diamonds, this MP3 player is certainly one glitzy gadget.
If you’ve got a couple grand burning a hole in your pocket we’ve got some over-the-top gadgets to spend it on. Check back every day as we bring you some of the most extravagant gadgets on the market.
The extravagant music player produced by German storage and audio device maker TrekStor was created especially for Russian-Canadian billionaire Alex Shnaider, according to the company's Web site. The gadget retails for $20,000, but the exact number of units TrekStor has sold remains unclear.
What is clear is that the gadget is extremely time consuming to manufacture. “Jewelers Wenthe in Mannheim/German put over 100 hours of pains-taking handiwork into the exquisite gadget,” according to TrekStor’s Web site.
Despite its lavish façade, the i.Beat Organix Gold does not represent a break-through in technology. It’s a typical MP3 player at heart. The device stores about 500 songs and has a battery life of approximately 25 hours. Compare this with Apple’s iPod Classic, which stores about 20,000 songs and has a battery life of roughly 30 hours and costs $250.
“Any techie person would not be moved by the technological capability of the device,” said Josh Martin a senior media and entertainment analyst with the Yankee Group.
What, then, drives super-wealthy individuals like Shnaider to purchase exuberantly expensive devices that by some accounts deliver lackluster technological capabilities?
“These devices have marketed themselves as being elite, they allow you to rise above the bourgeoisie.” Martin said.
In this case, it is the unique, one-of-a-kind status associated with owning a device that is enough to convince what may become a few super-wealthy individuals to purchase them. Nevertheless, even within the super-wealthy community these types of devices have failed to catch on.
“These are at best niche devices to buoy the brand-name,” Martin said “Nobody really buys these things and there is no market for such devices.”
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