I recommend a professional or a computer program.
You could lose too much many asking a question as
basic as this.

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

Native wrote:

- quote -

You are correct, LT Cap Gains is included in total income
but is taxed differently which is determined by the
worksheet for Sched D, it walks you through the process and
you will see the different amounts for the total tax to be
applied on line 43.

good luck

bill

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

"Native" <native_texan_03[at]yahoo.com> wrote:

- quote -

If you've made it this far without the instructions,
congratulations. You'll find the answer to your question in
the instructions for line 43.

--
Phil Marti
Clarksburg, MD

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

Native <native_texan_03[at]yahoo.com> wrote:

- quote -

When you have your AGI and have deducted your deductions and
also our exemptions, then stop.

Now go to the second page of schedule D and follow the
instructions. You will calculate income tax using a
worksheet in the Form 1040 instruiction booklet. That
calculation will tax capital gains and qualified ividends at
a lower rate than other income.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

- quote -

Line 42 is your taxable income, line 43 is the tax.

If you don't have any qualified dividends or caiptal gain,
you simply go to the tax tables to get the number for line
43. If you DO have qualified dividends or capital gains,
you go to a worksheet to figure out that tax. That worksheet
takes the 5% and 15% rates into account.

See http://home.earthlink.net/~don13027/..._Worksheet.xls

--
Don EA in Upstate NY

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

"Native" <native_texan_03[at]yahoo.com> wrote:

- quote -

Look at the Schedule D worksheet. You can get that at
http://www.irs.gov. Look for Schedule D instructions in the
Forms and Instructions area. I hope that helps.

Wayne Brasch, CPA, M. S. Taxation

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->

Hello:

Filling out my 2004 1040 form and have LT Capital Gains.
What is confusing me is I believed the LT Cap Gains would be
taxed at a fixed 5 or 15% rate depending upon my income.
However, what appears to be happening when I walk through
the 1040 is the LT Cap Gains get lumped into my "Total
Income" (Line 22 on 1040).

Then the total income goes to my AGI, take out my itemized
deductions and exemption and bam I'm at my Taxable Income.

Where does the 5 or 15% rate get applied???

<< -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << ------------------------------------------------->