Taxes can feel like a thorn in the side of every investor, but they’re an essential part of managing your portfolio. Whether you’re invested in common stocks, corporate bonds, or other assets, it’s important to know how taxes will affect your returns. While you should always consult your tax advisor prior to investing, let’s analyze the different types of taxes, the events that trigger them, and some of the strategies you can use to minimize the bite Uncle Sam takes from your hard-earned money. Capital Gains vs. Ordinary Income: The Two Big Tax Buckets When it comes to investment taxes, there are two primary categories you need to worry about: capital gains and ordinary income. Capital Gains: These are the profits you make when you sell an investment for more than you paid for it. If you sell the asset in less than a year, you’ll be hit with the short-term capital gains rate, which is the same as your regular income tax rate (up to 37% for high earners). If you’ve held the asset for more than a year, you’ll be taxed at the