January 12, 2019

Will I pay Taxes on my investments?

When you’re ready to sell a stock, bond or funds (like those you own with Acorns), you’ll likely have to pay taxes on any profit you made from the sale. If you’ve owned it less than a year, you’ll pay what’s called short-term capital gains tax, which is equivalent to ordinary income tax. But if you wait more than a year before you sell an investment for a gain, you’ll pay long-term capital gains tax, which is usually lower—another reason to hold onto your investments. Taxes may also be owed on ordinary dividends, qualified dividends and distributions. Tax rates for these will vary, and you should consult your tax advisor about your individual situation.

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