Capital gains are reported on Sch D. There is a short term and a long term line with the final result on Line 16. That amount is carried to your Form 1040, line7a shows your total net capital gain or loss allowed.
- If you have capital gains - The qualified dividends and capital gain tax worksheet does the math behind the scenes to determine your final tax on Line 16.
- If you have losses - Losses are capped at $3,000 for reporting on your tax return and the rest is carried over.
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