Estimate your capital gains tax for 2026, 2025, or 2024. Enter your ordinary income
and investment gains to see your short-term tax, long-term capital gains rate
(0%, 15%, or 20%), and Net Investment Income Tax (NIIT).
Calculate Your Capital Gains Tax
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Your total federal tax is $15,170 — including tax on ordinary income plus $50,000 in capital gains — for an overall effective rate of 12.14% on $125,000 in total income.
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Continue with these gains, income and deductions. Add your prior-year tax and expected withholding to check the remaining payment target.
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US capital gains tax is governed by
IRC §1(h)
and reported on
Schedule D
(with line-item detail on Form 8949). The system splits gains by holding
period: assets held ONE YEAR OR LESS produce short-term gains taxed at
ordinary rates (10%/12%/22%/24%/32%/35%/37%), while assets held LONGER
than one year produce long-term gains taxed at preferential 0%, 15%, or 20% rates.
The holding period starts the day AFTER acquisition and includes the
date of sale. For inherited assets, IRC §1223(9) automatically treats
the holding period as long-term regardless of how briefly the beneficiary
held the asset. Gifted assets carry over the donor's holding period.
For stock, the "first-in, first-out" (FIFO) default applies unless you
specifically identify shares — the
IRS Publication 550
"Investment Income and Expenses" covers the details.
Three additional layers can stack on top of the base 0/15/20% LTCG rate
for high-income filers: the 3.8% Net Investment Income Tax (§1411,
threshold $200,000 single / $250,000 MFJ), state capital gains
tax (varies widely from 0% in states with no income tax to 13.3% in California), and
special asset-class adjustments — 28% on collectibles and on the taxable part of
§1202 gain, 25% on unrecaptured §1250 depreciation.
2024 → 2026 long-term capital gains brackets
The LTCG bracket boundaries are indexed for inflation each year via IRS
revenue procedure. The 20% top rate has been unchanged since the
American Taxpayer Relief Act of 2012 — only the threshold creep up.
Filing status
2024 (0% / 15% break)
2025 (0% / 15% break)
2026 (0% / 15% break)
Single
$47,025 / $518,900
$48,350 / $533,400
$49,450 / $545,500
Married Filing Jointly
$94,050 / $583,750
$96,700 / $600,050
$98,900 / $613,700
Head of Household
$63,000 / $551,350
$64,750 / $566,700
$66,200 / $579,600
Married Filing Separately
$47,025 / $291,850
$48,350 / $300,000
$49,450 / $306,850
The 20% top rate applies above the 15% threshold. NIIT 3.8% stacks on top
whenever MAGI exceeds $200,000 single / $250,000 MFJ — that
threshold has been frozen at the 2013 ACA enactment level. Sources:
Rev. Proc. 2023-34 (2024), Rev. Proc. 2024-40 §2.03 (2025), Rev. Proc.
2025-32 §4.03 (2026).
Special asset-class rates
Three asset categories carry rates DIFFERENT from the standard 0/15/20%
LTCG schedule:
Collectibles — 28% max
IRC §1(h)(4) caps the LTCG rate on collectibles at 28%. Includes art,
rugs, antiques, gems, stamps, coins, alcoholic beverages held as
investment, and metals such as gold, silver and platinum bullion. Gain from selling an interest in a
partnership, S corporation or trust that is due to unrealized appreciation of
collectibles is also collectibles gain (IRS Pub. 550). Shares of mining companies use the regular
0/15/20% rates.
Unrecaptured §1250 — 25% max
When you sell depreciated real estate, the portion of gain attributable
to prior depreciation deductions ("unrecaptured §1250 gain") is taxed
at up to 25%. The remaining gain follows regular LTCG rates. Reported
on the
Schedule D unrecaptured §1250 worksheet.
Critical for landlords selling rental property — depreciation taken
along the way comes back as a separate 25% tax tier on sale.
QSBS §1202 — up to 100% exclusion
For Qualified Small Business Stock acquired on or before July
4, 2025 and held 5+ years, IRC §1202 excludes up to the
GREATER of $10M or 10× basis from gain — entirely federal-tax-free
(issuer's aggregate gross assets of $50M or less at issuance). For QSBS
acquired after July 4, 2025, OBBBA §70431 (P.L.
119-21) raises the per-issuer cap to $15M, raises the issuer
gross-asset ceiling to $75M, and replaces the fixed 5-year hold with
a tiered schedule: 50% exclusion after 3 years, 75% after 4 years,
100% after 5 years. State conformity varies (CA does NOT conform).
Reported on Form 8949 with code "Q" and Schedule D.
Six worked 2025 examples
All numbers use 2025 brackets (Rev. Proc. 2024-40) and the standard
deduction at 2025 levels. The calculator above runs your exact inputs;
these scenarios illustrate the bracket-stacking mechanics.
Retiree, single, $30k ordinary + $50k LTCG
The $15,750 standard deduction leaves $14,250 of taxable ordinary income, so $34,100 of the 0% band (which runs to $48,350) is still open. That much of the gain is taxed at 0%; the remaining $15,900 is taxed at 15%. LTCG tax: $2,385. No NIIT.
MFJ, $150k W-2 + $100k LTCG
Taxable ordinary income is $118,500, already past the $96,700 top of the 0% band, so the gain stacks entirely in the 15% band. LTCG tax: $15,000. No NIIT — MAGI is $250,000, exactly the $250,000 threshold, so nothing sits above it.
High-income single, $400k W-2 + $200k LTCG
Taxable ordinary income is $384,250, leaving only $149,150 of room under the $533,400 top of the 15% band — so that slice of the gain is taxed at 15% and the other $50,850 at 20%. The gain spans two bands; it is not all at 15%. LTCG tax $32,542.50, plus NIIT of 3.8% on the lesser of the $200,000 of investment income or MAGI over $200,000 = $7,600. Total on the $200,000 gain: $40,142.50 (20.1% effective).
Ultra-high income, $1M ordinary + $500k LTCG
Taxable ordinary income of $984,250 is past the $533,400 top of the 15% band, so the whole gain is taxed at 20% = $100,000. NIIT is 3.8% on the lesser of the $500,000 of investment income or the MAGI excess, which is the full gain = $19,000. Total on the $500,000 gain: $119,000 (23.8% effective) — plus state if applicable.
Primary home sale, MFJ, $700k gain
$500k is excluded under §121 (lived in 2 of the last 5 years), leaving $200,000 of taxable long-term gain — all long-term, because the home was owned more than a year. With $120,000 of ordinary income, taxable ordinary income is $88,500, so $8,200 of the 0% band under $96,700 is still open and only $191,800 is taxed at 15%. LTCG tax: $28,770. NIIT does apply — MAGI is $320,000, which is $70,000 over the $250,000 threshold, so 3.8% of that excess = $2,660.
Short-term flip, $40k gain
Sold on day 360 — short-term, so it is taxed as ordinary income. Added to $90,000 of wages it lifts taxable income from $74,250 to $114,250, so the gain straddles the 22% and 24% brackets rather than sitting entirely in the top one. Extra tax: $9,012 vs $6,000 if held one more week to long-term — a $3,012 timing cost.
Planning levers to reduce capital gains tax
Hold over 12 months. The single biggest lever. Short-term gains taxed at up to 37% vs long-term at up to 20% — a difference of up to 17 percentage points. Check your purchase date before selling near the one-year mark.
Tax-loss harvesting. Realize losses to offset realized gains, then up to $3,000/year against ordinary income. Watch the §1091 wash-sale rule (30-day window). The /tax-loss-harvesting-calculator/ models the value; /wash-sale-calculator/ handles the trap.
Specific-share identification. When selling part of a position, identify the highest-basis lots to minimize gain. Your broker requires written instruction — many default to FIFO which often realizes the largest gain. Confirm on the trade confirmation.
Bunch gains into low-income years. The 0% LTCG bracket $48,350 single / $96,700 MFJ creates an annual "free harvest" window. Retirees between job exit and Social Security claim often have artificially low ordinary income — realize gains to flush them up to the 0% threshold.
Charitable donation of appreciated stock. Donate long-term-held appreciated shares directly to a §501(c)(3) charity or Donor-Advised Fund — you skip the capital gains tax AND deduct the full FMV (subject to 30%-of-AGI cap for appreciated-property gifts). Cleaner than sell-then-donate which realizes the gain.
§1031 like-kind exchange (real estate). Defer gain by rolling proceeds into replacement real property. 45-day identification, 180-day close (or your return due date including extensions, if earlier), with the proceeds held by a qualified intermediary rather than received by you. Useful for landlords trading up; gain is deferred until eventual cash-out.
Step-up at death. §1014 erases all unrealized gain at death. For taxpayers 70+ with highly appreciated low-basis stock, holding until death may be preferred over selling and paying 20% + 3.8% NIIT + state. Estate planning trade-off vs §2010 lifetime exemption ($15M under OBBBA §70106).
Opportunity Zone deferral. §1400Z-2 defers gain recognition when invested in a QOF within 180 days — until 2026-12-31 for investments made through that date, and a rolling 5-year deferral for investments made after it (OBBBA §70421). A 10-year hold removes appreciation INSIDE the QOF from tax. See /opportunity-zone-calculator/.
Common capital gains mistakes
Triggering wash sales by accident. Selling a stock or fund at a loss and buying the same security, or one that is substantially identical, within 30 days before or after the sale disallows the loss. It also applies if your spouse buys the replacement, or if you buy it in an IRA. The IRS decides "substantially identical" on the facts and circumstances (Pub. 550), so the safest alternatives are a clearly different holding or waiting out the 30 days.
Forgetting depreciation recapture on rental sales. Years of depreciation deductions come back as §1250 unrecaptured gain at up to 25% — separate from the LTCG rate on the remaining gain. Many landlords are surprised by a five-figure tax bill on what they thought was a §121-style exclusion.
Crypto-to-crypto swaps treated as nontaxable. Each swap is a taxable disposition of the OUT coin. Trading BTC for ETH realizes BTC gain; trading ETH for SOL realizes ETH gain. The IRS has clarified this repeatedly since 2014.
Missing the §121 use test on a converted rental. Property converted from rental to primary residence must still meet 24-month use within the 5 years before sale. Time spent renting it OUT doesn't count — only personal use. Partial exclusion available only for qualifying hardship.
Reporting basis from the 1099-B without checking. Brokers must report basis for "covered" securities acquired after 2010 (stocks) / 2011 (mutual funds) — but cost-basis methods, gifted securities, and inherited assets often need manual adjustment on Form 8949. Compare the 1099-B against your own records.
Ignoring state capital gains tax. Most states tax capital gains at the same rate as ordinary income, on top of the federal rate (California's top bracket is 13.3%). States with no income tax levy nothing on gains, except Washington: its separate excise tax on long-term gains is 7% on the first $1 million and 9.9% above that, after a standard deduction ($278,000 for 2025). Always model state tax alongside federal.
Quick-reference card
Short-term vs long-term
≤1 year = ordinary rates up to 37%. >1 year = preferential 0%/15%/20%.
Net Investment Income Tax
3.8% surtax above $200,000 (Single) / $250,000 (MFJ) MAGI. Form 8960. Thresholds are fixed by statute and not inflation-indexed.
Capital loss deduction
Losses offset gains. Up to $3,000/year against ordinary income; remainder carries forward indefinitely (§1212).
Home sale exclusion (§121)
$250k single / $500k MFJ on primary residence (own + use 24 of last 60 months).
Frequently asked questions
What is capital gains tax?
Capital gains tax is income tax on profit from selling a capital asset for more than its adjusted basis. Federal treatment depends on the holding period, total taxable income, asset type, losses, exclusions and possible Net Investment Income Tax.
What is the difference between short-term and long-term capital gains?
Short-term capital gains come from assets held for one year or less (measured day-by-day from purchase) and are taxed at your ordinary income tax rates — up to 37% in 2025. Long-term capital gains apply to assets held for more than one year and benefit from preferential 0%/15%/20% rates under IRC §1(h). The one-day difference around the 12-month mark is consequential: a stock sold on the one-year anniversary of the purchase is still short-term; sold the next day, it is long-term.
What are the 2025 long-term capital gains tax rates?
For 2025 (Rev. Proc. 2024-40 §2.03): 0% rate applies when taxable income is at or below $48,350 single / $96,700 MFJ / $64,750 head-of-household. 15% rate applies from that threshold up to $533,400 / $600,050 / $566,700. 20% rate applies above. The threshold is on TAXABLE income (after the standard or itemized deduction), not gross income — a single filer making $64,100 gross with the $15,750 standard deduction has $48,350 taxable, putting them at the very top of the 0% bracket.
What are the 2026 capital gains rates?
For 2026 (Rev. Proc. 2025-32 §4.03): 0% up to $49,450 single / $98,900 MFJ. 15% to $545,500 / $613,700. 20% above. The thresholds are inflation-indexed annually under §1(j)(5). The 20% top rate has been unchanged since the American Taxpayer Relief Act of 2012.
What is the Net Investment Income Tax (NIIT)?
The 3.8% Net Investment Income Tax (IRC §1411) applies on top of LTCG/short-term rates when MAGI exceeds $200,000 single / $250,000 MFJ / $125,000 MFS. The tax is 3.8% × the lesser of (a) net investment income, or (b) MAGI excess over the threshold. Reported on Form 8960. The thresholds are fixed in the statute (enacted in 2010, effective for 2013 onward) and are NOT indexed for inflation.
How does ordinary income affect my capital gains rate?
Your ordinary income "fills up" the lower tax brackets first, then LTCG stacks on top. The bracket your LTCG lands in determines its rate. If your ordinary taxable income already exceeds the 0% LTCG threshold ($48,350 single 2025), all LTCG is taxed at 15% or 20%. If it's below, some LTCG may qualify for 0% — the portion that fills up to the 0% ceiling, with the remainder at 15%/20%. The IRS Schedule D Tax Worksheet walks the stacking line by line.
How do I qualify for the §121 home sale exclusion?
Under IRC §121 you can exclude up to $250,000 (single) or $500,000 (MFJ) of gain on the sale of your primary residence IF you both owned the home AND used it as your principal residence for at least 24 months out of the 60 months immediately preceding the sale. Both spouses must satisfy use for the full $500,000; only one needs to satisfy ownership. Partial exclusions exist for job relocations, health, or unforeseen circumstances. A home you never used as your principal residence — a pure rental, vacation home or second home — doesn't qualify.
What is the wash sale rule?
Under IRC §1091, if you sell a security at a loss and buy "substantially identical" stock within 30 days BEFORE or AFTER the sale (61-day window), the loss is DISALLOWED — added to the cost basis of the replacement shares. This blocks the simplest tax-loss harvesting maneuver of selling at a loss and immediately rebuying. The rule applies if your spouse (or a corporation you control) buys the replacement, or if you buy it in your IRA or Roth IRA (in that case the disallowed loss is not added to any basis). Whether two securities are "substantially identical" depends on the facts and circumstances; stock of one corporation is ordinarily not substantially identical to stock of another corporation (IRS Pub. 550). The /wash-sale-calculator/ models common edge cases.
How does tax-loss harvesting work?
Realized capital losses offset realized gains dollar-for-dollar — short-term losses first against short-term gains, long-term first against long-term, then cross-netted. Net losses offset up to $3,000 of ordinary income per year ($1,500 MFS); remaining losses carry forward indefinitely under §1212. The /tax-loss-harvesting-calculator/ models the value of harvesting a position; the /wash-sale-calculator/ handles the 30-day trap. For high earners, harvesting also reduces NIIT by lowering investment income.
Does inheriting an asset trigger capital gains?
No. Under IRC §1014 inherited assets receive a "stepped-up" basis equal to fair market value on the date of death (or alternate valuation date six months later, if elected). The decedent's unrealized gain is permanently erased — beneficiaries only pay tax on appreciation AFTER inheritance. There's no step-up for gifts during life — gifted assets generally carry over the donor's basis.
How are qualified dividends taxed?
Qualified dividends (paid by US corporations or qualified foreign corporations on stock you held more than 60 days during the 121-day period that begins 60 days before the ex-dividend date) are taxed at the SAME 0%/15%/20% LTCG brackets — they share the §1(h) thresholds with long-term capital gains. Non-qualified (ordinary) dividends are taxed at ordinary rates. Box 1a on Form 1099-DIV is total ordinary dividends; box 1b is the qualified portion. The /qualified-dividend-calculator/ separates the two layers.
What's the §1031 like-kind exchange?
IRC §1031 allows real property held for investment or business use to be exchanged for "like-kind" real property without recognizing gain — deferring the tax until eventual cash-out sale. TCJA limited §1031 to real estate only (no more equipment, art, or collectible exchanges). Strict rules: 45 days to identify replacement property and 180 days to close (or the due date of your return including extensions, if earlier); the sale proceeds must not pass through your hands, which in practice means a qualified intermediary. Reported on Form 8824. The deferred basis carries over to the new property — gain isn't forgiven, just delayed.
How does the Opportunity Zone deferral work?
Under IRC §1400Z-2, gains invested in a Qualified Opportunity Fund (QOF) within 180 days are deferred until the EARLIER of the QOF sale or 2026-12-31 for investments made through that date. For QOF investments made after December 31, 2026, the One Big Beautiful Bill Act (P.L. 119-21 §70421) replaces the fixed date with a rolling deferral to the earlier of sale or 5 years after the investment. Hold the QOF investment 10+ years and the appreciation INSIDE the QOF is excluded — basis steps up to FMV at sale (capped at 30 years). See /opportunity-zone-calculator/.
Does the §121 exclusion stack with state taxes?
The §121 exclusion is a federal rule. States that start from federal income generally carry it through, but each state sets its own treatment, so check your state's rules before assuming a clean state exclusion.
Are crypto gains taxed at LTCG rates?
Yes — IRS Notice 2014-21 treats virtual currency as PROPERTY, so crypto sales follow the same short-term (ordinary) / long-term (0/15/20%) rules as stocks. The one-year holding period starts on acquisition. Crypto-to-crypto trades are taxable events (each swap realizes gain on the disposed coin). Section 1091 covers losses on "shares of stock or securities", and the Form 1099-DA instructions require wash-sale reporting only for tokenized securities treated as stock or securities under §1091, so crypto held as property is generally treated as outside the wash sale rule.
