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Updated almost 6 years ago on . Most recent reply

User Stats

13
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3
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Sean Murphy
  • Greenwood, IN
3
Votes |
13
Posts

Capital Gains on index Funds

Sean Murphy
  • Greenwood, IN
Posted

I understand when you sell index funds, as long as you hold your fund for a year or longer, the tax rate is long-term capital gains.

My question: When I continually buy shares of VTI (Vanguard ETF) on a monthly basis, how can I accurately determine how many shares I could see without being penalized my the short term vs. long term cap gains tax rate?

HypotheticL example: if I buy 10 shares of VTI every month, and I’ve been doing this for 5 years. I have 600 shares after 5 years. If I wanted to sell everything at once, Does this mean I can only sell 480 shares for the long term capital gains tax but would have to pay short term cap gains tax on the shares that I recently bought within that year?

Apologize for the winded question, but haven’t been able to find a straight answer anywhere.

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