1

I bought 1000 of stock A at price of 20. Two hours later, the stock price for A went down to 17, and I bought 1000 more of them, and two hours later, the stock price reached 19, and I sold all 2000 stocks.

Will I be taxed on the profit: 2000*19 - 1000*17 - 1000*20 = 1000 or some other amount?

Any help would be greatly appreciated.

  • 1
    Your calculation is correct. $1,000 STCG. – Bob Baerker Jun 27 '18 at 15:25
7

Your math is correct, but you'll also deduct from your gain any fees/costs associated with making those trades, so unless you made those trades for free, you'll have slightly less than $1,000 in short-term capital gain from this series of transactions.

When selling all shares, it's total proceeds from sale less cost to acquire/sell those shares. The order of buys/sells (FIFO/LIFO) only matters when selling portions of positions.

  • Also, if you have other transactions (more exactly, other dispositions) in the same year, it is the net totals (gains minus losses) for the year that is subject to tax. – dave_thompson_085 Jun 28 '18 at 0:08

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