Capital Gains Legal Meaning and Definition

Here is a simplified definition of the legal term Capital Gains.

Capital Gains (noun)

Capital Gains refers to the increase in value of an investment or real estate property over time. This increase, which often occurs due to factors such as inflation or heightened demand, becomes the financial gain for the owner upon selling or otherwise giving up possession of the asset. It's important to note, capital gains may be subject to taxes, but specific rules and exemptions can lessen the taxable amount.