why are short term capital gains taxed as ordinary income
Capital gains tax in the United States The one-year threshold between short-term and long-term capital gains is arbitrary and has changed over time. Short-term gains are disparaged as speculation and are perceived as self-interested, myopic, and destabilizing,[26] while long-term gains are characterized as investment, which supposedly reflects a more stable commitment that is in the nation's interest. Others call this a false dichotomy.[27] The holding period to qualify for favorable tax treatment has varied from six months to ten years (see History above). There was special treatment of assets held for five years during the Presidency of George W. Bush. In her 2016 Presidential campaign, Hillary Clinton advocated holding periods of up to six years with a sliding scale of tax rates.[28]