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What is a capital asset; should it be taxed?

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First, define what a capital asset is. How is it defined in the code?

You Decide: Tax Capital Gains?

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Solution Summary

This solution is 243 words plus a reference and discusses the accounting, economic and tax definition of a capital asset and how they are related.

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A capital asset has many different definitions, depending on whether you are thinking of an accounting, an economic or a tax perspective.

In financial accounting, capital assets are those that last for years. These are depreciated over their useful life and generate business income (hopefully).

In economics, a capital asset is one that is used to make money. ...

Solution provided by:
Carol Sargent, PhD
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
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