Brokerage (Investing)

Brokerage accounts, are a fancy way of just saying a normal investing account. These accounts let you invest, without Tax advantages, and lets you withdraw at anytime.

These accounts are great for investing money you might need in the future, especially without limits on when your allowed to withdraw. However, they are taxed depending on how much you make, and how long you hold your investments before selling.

Short-Term Capital Gains (Held 1 Year or Less)

• Taxed as Ordinary Income: Rates match your regular federal income tax brackets (10% to 37%).

Long-Term Capital Gains (Held More Than 1 Year)

• Favorable Rates: 0%, 15%, or 20%, depending on your taxable income and filing status.

• 2025 Income Brackets (for assets sold in 2025, reported in 2026) :

• 0%: For single filers up to $48,350; married filing jointly up to $96,700.

• 15%: For single filers $48,351–$533,400; married filing jointly $96,701–$600,050.

• 20%: For single filers over $533,400; married filing jointly over $600,050.

Huh?

So essentially, it's best to invest and hold your investments for at least a year to have 0% to 20% taxes.

To also clarify, your only taxed on the money you MAKE from investing. For example,

If you invest into Apple and buy one share of Apple for $100 dollars, and that share grows to be worth $200, you would only be taxed on the $100 dollars of growth you had.