1.5. Calculating taxes on capital gains takes a little work, but if you buy and sell stocks, bonds, works of art, or homes, you'll probably have to do this at some point. Let's practice. In a few cases below, the price will fall-just record that as a negative rise (a "capital loss," in tax jargon). (In some cases, you can use these to offSet taxes on capital gain but we won't get into that detail here).

a. Fill in the table below.

Item 10 Shares of Microsoft Stock 1 Share of Berkshire Hathaway stock 100 Shares of GM stock 1 Picasso napkin sketch 1 Mexican Amate folk painting Purchase Price 2015

$1 ,200 Sale Price 2020

$1 ,250

$8,000 $11,000

$1,000

$500

$15,000 $14,000

$2,000

$3,500 Tax Due Capital at 15%

Gain Rate

$50

$7.50

b. One nice thing about the capital gains tax is that you can choose what year to pay it by choosing what year to sell your investment.

If you wanted to sell your single share of Berkshire stock and your Picasso in the same year, how much tax would you pay?