Any investor, but not homeowner or flipper, can take advantage of the reduced capital gains tax rates, as long as the rules are followed.
If you own property for a certain minimum period of time before selling it, you can pay taxes at a reduced rate on the gain. Currently, the highest tax rate for long-term capital gains is 15%. For short-term capital gains (property held one year or less) or for other ordinary income, the highest rate is 35%.
To qualify for long-term capital gains rates, you must hold the property for more than one year. This does not mean exactly one year, but rather more than one year.
The first day is considered the day after you acquired the property. The day you sell it is counted as part of the holding period. If you buy on January 1, 2008, then January 2, 2008, counts as the first day of the holding period.
If you sell on January 1, 2009, then that is exactly one year that you have held the property, and you do not get capital gains treatment.