How are capital gains taxes calculated when selling stocks?

Does wash sale rule apply here too? I sold some stocks at a loss last year and bought similar ones within 30 days and it really messed up my taxes.

Thanks so much for the detailed explanation! So if I'm understanding right, I'd pay about 15% on the $2,700 gain from my tech stocks (around $405) and 22% on the $300 gain from my dividend stocks (about $66)? Does the broker automatically calculate my cost basis or do I need to keep my own records of what I originally paid?

The wash sale rule only applies when you sell investments at a loss and then buy substantially identical securities within 30 days before or after the sale. Since OP is selling at a gain, they don't need to worry about this rule right now. You've got it exactly right on the tax calculations! Most brokers today do track your cost basis and will report it on your 1099-B. This became mandatory for stocks purchased after 2011. However, it's always good practice to keep your own records as a backup. Sometimes there can be adjustments needed if you've reinvested dividends or made multiple purchases of the same stock at different prices.

Does taxr.ai handle crypto transactions too? My tax situation is kinda messy with both stocks and some crypto trades.

I'm skeptical about uploading my financial documents to some random website. How secure is it? Do they store your brokerage statements?

Yes, taxr.ai does handle cryptocurrency transactions! It can process various crypto exchange statements and even handles complex situations like staking rewards, mining income, and DeFi transactions. It separates everything into the right tax categories. Regarding security, I had the same concerns initially. They use bank-level encryption and don't permanently store your documents - they're analyzed and then deleted from their servers. They also have a privacy policy explaining they don't share your data with third parties. You can even use their document analysis without creating an account if you're really concerned.

How does this actually work? Do they have some special connection to the IRS or something? I've been trying to reach someone about my amended return for weeks.

Sounds too good to be true honestly. I've called the IRS dozens of times and NEVER get through. No way some website can magically make them call you back when they don't even answer their phones.

It's not a special connection - they use a combination of automation and timing algorithms. They basically call the IRS repeatedly using optimal timing patterns based on historical data about when call volumes are lowest. When they get through, they request a callback for you specifically. It's like having someone continuously redial for you instead of you having to do it yourself. I was definitely skeptical too! I had spent almost 3 hours on hold one day before getting disconnected. What convinced me was watching people's real experiences in their video. It doesn't work instantaneously - my callback took about 45 minutes, but that's WAY better than the days I wasted trying on my own. They can't control how helpful the IRS agent will be once you're connected, but at least you get to actually speak with someone.

Good point - I'm in Minnesota. Does anyone know how MN handles capital gains taxes? Are they taxed differently than regular income at the state level?

Minnesota taxes capital gains as regular income, unlike the federal government which gives preferential rates to long-term gains. So you'll pay your normal Minnesota income tax rate on all your capital gains regardless of how long you held the investments. Minnesota's income tax rates range from 5.35% to 9.85% depending on your income bracket. Given your regular 22% federal bracket, you're probably looking at the middle Minnesota brackets (6.8% or 7.85%). There's no separate capital gains rate structure at the state level.

This is super important! Tax-loss harvesting saved me thousands last year. If you have any investments at a loss, you might want to sell those at the same time to offset some of your gains.

That's a great point about tax-loss harvesting. Just remember the IRS limits capital loss deductions against ordinary income to $3,000 per year. However, you can use capital losses to offset unlimited capital gains. Any unused losses can be carried forward to future tax years.