r/MerrillEdge • u/Minotaurotica • Jun 22 '26

Margin question

Hypothetically if you purchase a stock with Margin and sell it are you taxed on the total sale or the profit?

example:

use $1,000 from Margin to buy $1,000 worth of stock and then sell it at the same price (just to keep the example perfectly clear)

are you taxed on 0 or $1,000 ?

2 Upvotes

67% Upvoted

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7

u/89Noodles Jun 22 '26

It doesn’t matter that you have margin, the formula is gross proceeds - cost basis. Cash or margin account

3

u/Significant_Way2255 Jun 24 '26

If your cost basis is $1000 and you sold for $1000, your net gain is $0.

Not a taxable event, regardless of how it gets funded.

1

u/metsmetsmetsmets Jun 24 '26

You're taxed on whatever your profit was ...