hen calculating how much you can put down on a home, be sure to subtract the cost of cashing in your investments.

Transaction fees
Unless you have all your money in a bank account, you have to pay transaction fees to have a third-party find a buyer. For example, if you sell a house, you have to pay a Realtor to help you find someone to buy the home.

The size of these fees depends greatly on the type of investments that you have. To sell a house you may have to pay a real estate agent 6% of the selling price. Selling your stocks online, however, may cost you less than $20.

Capital gains taxes
The amount of tax that you pay on the profit from the sale of your investments depends on the type of investment, how long you held the investment and your income tax bracket.

The following table shows the capital gains tax rates for different income tax brackets and hold periods.



Taxes on real estate
When you sell a house, you can pocket a $250,000 profit if you are single, widowed or divorced, or a $500,000 profit if you are married, without paying any tax on it.

You only pay the new 20% rate on gains above this exemption, or if you didn't live in the house for at least two of the last five years before selling it. So, if you bought a house for investment purposes or as a vacation home, you have to pay the 20% tax on any profit when you sell.

State taxes
Many states charge capital gains taxes in addition to those charged by the federal government. Since these taxes vary by state, we suggest that you ask a tax accountant in your area for information on what other taxes you might have to pay.

A tax accountant can also help you create a strategy for minimizing the amount of tax that you pay on your capital gains.