Capital gain from the sale of a collectible held for more than one year is taxed at 28 percent.

That is significantly higher than the capital gains tax rate for most investments, which are taxed at a maximum 15 percent rate, 5 percent for taxpayers in the 10 or 15 percent tax brackets. Short-term investments in collectibles are taxed as short-term capital gains at ordinary income tax rates.

As you can see, the rate on collectibles is almost double the rate on other investments, and that can make a big difference. A few years ago, Sen. John Kerry made the newspapers when a review of his tax return showed that he reported tax on the sale of a painting at a $175,000 gain at the then-new 15 percent capital gain tax rate, when it should have been taxed at 28 percent as a collectible.

Collectibles include stamps and coins, fine wines, works of art, rugs, antiques, metal, gems, glassware and other commonly collected items. A collection of political campaign buttons and badges can be a collectible. If an item is an antique, it is probably a collectible.

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