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🇺🇸 US · US taxShort-term capital gains
Also called: STCG
In one line
Profit on assets held a year or less, taxed at your higher ordinary-income rates.
In plain English
Sell within a year of acquiring shares and the gain is taxed like salary — the higher rate. It's what you usually want to avoid by holding a little longer.
If you were explaining it to a 5-year-old
If you sell your toy quickly, the taxman takes a bigger bite than if you'd waited.
Why it matters when you sell
Selling a secondary too soon after exercising can push your gain into the higher short-term bracket — timing matters for your take-home.
Related terms
Put it to use
When you're ready to go deeper, there's an optional Equity Toolkit and Report.
Sources
Primary references for this term: IRS (US tax). Our definitions are written in plain English and kept evergreen — see the glossary methodology. General information, not advice.
Educational information only — not financial, tax or legal advice, and not an offer to buy or sell any security. Definitions are general; your own documents and local law govern your situation. PrivateTechShares is independent and not a broker or marketplace.