You heard right. There's no -- nada, nothing, zilch, zero -- capital gains tax on the sale of assets held for more than a year.

But you might not have heard the full story.

Bob D. Scharin, senior tax analyst from the tax and accounting business of Thomson Reuters, calls the law that took effect on Jan. 1, 2008, "the ultimate tax rate reduction." But as is often the case with tax provisions, this modification comes loaded with restrictions.

First, the elimination of capital gains tax applies only to assets owned for more than a year. Short-term sales remain taxed at your ordinary tax rate.

Then there is a monetary cap, as well as a limited time frame to take advantage of the tax break.

And it's not for every investor. Some young investors have been expressly excluded from the zero percent option. Others, such as Social Security recipients, could find that untaxed capital gains might mean new or additional taxes on their retirement benefits.

So before you rush to your broker to sell all your stocks and mutual funds, check out the new law's finer points and how it might or might not apply to you.

Limited to lower incomes

Beginning in 2008, those bracket limits and the potential tax savings by reducing the maximum capital gains rate from 5 percent to zero percent are as follows.

While some taxpayers might look at the income limits and presume they can't take advantage of the zero rate, that might not be the case. The reason: The cut-off amounts are taxable income, not the larger adjusted gross income amount.