I know that this sounds like a dumb question but please be leanient on me. I am 18 and I'm trying to invest in the stock market to make a possible comfortable living for myself and I don't know much about all this so that's all I want to know.
oldprof
Favorite Answer
You pay taxes on your capital and interest earnings from the stocks and bonds you hold and/or sell. And the interest you earn and the capital profits you make are itemized in forms 1099, which you receive at the end of each tax year.
To earn a "comfortable living" from investments, you need close to $2 million in stocks and bonds. We assume a 5% return on investment (ROI) per annum. That would give you $200,000 per year before taxes. Which at a nominal tax rate of roughly 40% would give you $120,000 per year for your comfortable living.
There is no guarantee for ROI of course. So you could earn far less...but maybe even more.
Judy
You pay it yourself.You might have to make estimated payments.