Many things we have in our everyday life qualify as capital assets. As a result, when it comes time to sell them, we are required to report a capital gain or loss on the assets. So what is considered a capital asset? Below you will find the list of the most commonly reported capital assets:
- Investment property
- Personal use property
- Household furnishings
- Coin/stamp collections
- Gems, jewelry, gold, silver or any other metal
- Stocks/bonds held in a personal account
So now you know what is a capital asset, what does not qualify as a capital asset?
- Inventory held for sale to a customer
- Accounts receivable
- Depreciable property
- Supplies regularly used in the ordinary course of business
As noted, many of our things are capital assets. Taking the time to record these sales properly is important and can help with getting a possible refund if there are capital losses.