Does timing of stock sale affect taxes?

Matt Krantz for USA Today writes: Question : Is it worth holding off selling a stock to get a lower tax rate? 

Answer: Frequent traders like to say it's never wise to let Uncle Sam make your investment decisions for you. But in reality, tax considerations are enormous and shouldn't be ignored.

When you sell a winning stock that you've own for a year or less, you have quite a bill to pay in many cases. These so-called short-term capital gains are taxed at your ordinary income tax bracket, which ranges from 10% to 35%. That's a hefty bill for most investors.

By holding onto a winning stock for more than a year, when you sell, your gain likely qualifies for the long-term capital gains rate. The long-term capital gains rate is a bargain next to most people's short-term capital gains rates. Investors in the 10% and 15% ordinary income tax rates pay 0% capital gains taxes on their long-term gains. And other investors in the 25% or higher ordinary income tax rates are access long-term capital gains rates of 15%.

Given the massive amount of difference between the long-term and the short-term capital gains rates, you can see that unless you think a stock is going to fall by a large amount, and you risk suffering a hit by holding, you're most often best off holding on for a couple of extra days to qualify for the lower tax rate.