A taxable account is an investment account that is subject to income and capital gains taxes. This type of account typically holds securities such as stocks, bonds or mutual funds which generate taxable income or capital gains when sold. The earnings from these investments are reported annually on a Form 1099-B and must be declared as income on your personal tax return. Taxpayers may be able to offset their tax liability by deducting losses, expenses, or other tax credits related to the account.