Group 1 - The core concept of stock taxation is that taxes are only owed when stocks are sold for a profit, known as capital gains [2][11][29] - Stocks are classified as capital assets, and their value can fluctuate, leading to unrealized gains or losses that are not taxed until realized through a sale [2][29] - Capital gains tax rates vary based on the duration the stock is held, with short-term gains taxed as ordinary income and long-term gains taxed at reduced rates [9][26] Group 2 - Short-term capital gains are taxed at ordinary income rates, which range from 10% to 37% for the 2025 tax year, while long-term capital gains are generally taxed at rates of 0%, 15%, or 20% depending on income [9][26] - A capital loss occurs when a stock is sold for less than its purchase price, and while capital losses do not incur taxes, they can offset capital gains and reduce taxable income [6][10][30] - Tax loss harvesting allows investors to sell stocks at a loss to offset gains, with specific limits on how much can be deducted from taxable income [21][30] Group 3 - Dividends received from stocks are taxable when received, regardless of whether the stock is sold, and the tax rate depends on the classification of the dividends [12][17] - The net investment income tax (NIIT) applies to investors with income above certain thresholds, adding an additional 3.8% tax on investment income [14][18] - Tax-advantaged accounts like 401(k)s and IRAs can help investors lower their tax liabilities on investments, with specific rules governing withdrawals [22][23]