Gain

DEFINITION of 'Gain'

An increase in the value of an asset or property. A gain arises if the selling or disposition price of the asset is higher than the original purchase or acquisition price. This positive difference between the sale price and purchase price is referred to as the gross gain; if transaction costs such as commissions and other expenses are considered, this would be a net gain. A gain may either be realized, i.e., when the asset is actually sold, or unrealized, i.e., a paper gain. Another important distinction of a gain is that it may be taxable or non-taxable.

BREAKING DOWN 'Gain'

In most jurisdictions, realized gains are subject to capital gains tax. However, if the gains accrue in a non-taxable account - such as an Individual Retirement Account in the U.S. or a Registered Retirement Savings Plan in Canada - gains will not be taxed.


For taxation purposes, net realized gains - rather than gross gains - are taken into consideration. In a stock transaction in a taxable account,the taxable gain would be the difference between the (higher) sale price and purchase price, after taking brokerage commissions into consideration.

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  4. Capital Gain

    1. An increase in the value of a capital asset (investment or ...
  5. Long-Term Capital Gain Or Loss

    A gain or loss from a qualifying investment owned for longer ...
  6. Recognized Gain

    When an investment or asset is sold for an amount that is greater ...
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RELATED FAQS
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    There are two main ways in which a person gains from an investment. The first is by capital gains, the difference between ... Read Answer >>
  2. What is the difference between dividends and capital gains?

    Read about some of the differences between dividends and capital gains, the two primary ways of accumulating wealth through ... Read Answer >>
  3. Is there a difference between capital gains and dividend income?

    Selling something for a profits leads to capital gains. A payment made by a corporations to stockholders is a dividend. Both ... Read Answer >>
  4. Are my 2015 unrealized capital gains and dividends on mutual funds taxable income?

  5. Are capital gains taxed differently in different countries?

    Learn about capital gains taxes in the Unites States as well as those of other countries, where these tax rates vary significantly. Read Answer >>
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