IRS Publication 550

A document published by the Internal Revenue Service (IRS) that provides information on how investment income and expenses are to be treated when filing taxes. IRS Publication 550 explains what investment expenses are deductible, when gains and losses from the sale of investment property are to be reported and what type of investments are considered taxable.

Investors who purchase U.S. property from a foreign individual or firm may be required to withhold income taxes. In addition, U.S. citizens must report income earned on foreign investments, even if a Form 1099 was not issued. This is explained in more detail in IRS Publication 515. Special tax rules apply to employees who exercise stock options. More information is provided in IRS Publication 525.