TaxWrenKey takeaways
- Assets held more than one year are taxed at 0%, 15% or 20% in 2026. For a single filer, 0% applies up to $49,450 of taxable income and 20% starts above $545,500.
- The rate depends on your taxable income with the gain stacked on top of your other income, so one gain can be taxed partly at 0% and partly at 15%.
- Short-term gains (held one year or less) are taxed as ordinary income, at 10% to 37%.
- Above $200,000 of modified AGI ($250,000 married filing jointly), the 3.8% net investment income tax can apply on top.
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In 2026, long-term capital gains, on assets you held for more than one year, are taxed at 0%, 15% or 20% depending on your taxable income. A single filer pays 0% on long-term gains while taxable income stays at or below $49,450, and 20% only on the part above $545,500. Short-term gains are taxed like wages, at 10% to 37%, and higher earners can owe the 3.8% net investment income tax on top.
What are the long-term capital gains tax brackets for 2026?
The thresholds below are amounts of taxable income, after the standard or itemized deduction, and they include the gain itself.
| Filing status | 0% rate | 15% rate | 20% rate |
|---|---|---|---|
| Single | up to $49,450 | over $49,450 to $545,500 | over $545,500 |
| Married filing jointly | up to $98,900 | over $98,900 to $613,700 | over $613,700 |
| Head of household | up to $66,200 | over $66,200 to $579,600 | over $579,600 |
Taxable income for 2026. Source: IRS Rev. Proc. 2025-32 section .03 (maximum capital gains rate amounts).
The thresholds are adjusted for inflation every year. For 2025, the single-filer limits were $48,350 for the 0% rate and $533,400 for the 15% rate.
How is the rate on a gain worked out?
Your other taxable income is taxed first at the ordinary rates. The long-term gain is then stacked on top of it, and each slice of the gain takes the rate of the bracket it lands in. A gain never raises the rate on your wages, and a single gain can be taxed partly at 0% and partly at 15%.
How much tax do you pay on a long-term vs a short-term gain?
Short-term gains, on assets held one year or less, are added to your ordinary income and taxed at the regular 10% to 37% federal tax brackets. The difference from waiting past one year grows with income:
| Wages | Held over 1 year | Held 1 year or less | Long-term rate on the gain |
|---|---|---|---|
| $40,000 | $0 | $3,000 | 0.0% |
| $75,000 | $3,750 | $5,500 | 15.0% |
| $150,000 | $3,750 | $6,000 | 15.0% |
| $300,000 | $4,700 | $9,700 | 18.8% |
| $700,000 | $5,950 | $10,200 | 23.8% |
Federal income tax plus net investment income tax on a $25,000 gain, 2026, single filer with wages only and the standard deduction, no state tax. Calculated with our capital gains tax calculator.
Long-term gains and qualified dividends share the same brackets. To run your own numbers, including state tax, use the capital gains and dividend tax calculator.
Do high earners pay more than 20%?
Yes, through the net investment income tax. It is 3.8% of the smaller of your net investment income or the amount by which your modified AGI exceeds $200,000 (single or head of household) or $250,000 (married filing jointly). Investment income includes capital gains, dividends, interest and rents. Wages are not taxed by it, and neither is home sale gain you exclude from income. For gains in the top bracket that makes the federal rate 23.8%.
Which gains are taxed at 25% or 28%?
A few kinds of long-term gain have their own maximum rates instead of 20%:
- collectibles such as coins or art: up to 28%,
- the taxable part of a gain on section 1202 qualified small business stock: up to 28%,
- unrecaptured section 1250 gain, the part of a real estate gain that comes from depreciation you took: up to 25%.
Topic 409 gives these as maximum rates. Our calculator does not model them.
Do states tax capital gains?
Most states tax capital gains as ordinary income at their regular rates, with no lower long-term rate. Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Wyoming do not tax them. Washington has a separate tax on some large long-term gains. See the state income tax map for each state's rates; the capital gains calculator adds the state tax a gain causes.
How can losses lower the tax on a gain?
Capital losses offset capital gains first. If losses are larger than gains, up to $3,000 a year reduces your other income and the rest carries forward. Our guide to tax-loss harvesting covers the rules and the wash-sale trap. If you sell a main home you owned and lived in for at least two of the five years before the sale, a separate exclusion of up to $250,000 of gain ($500,000 married filing jointly) applies before any of these rates.
Sources
- IRS: Rev. Proc. 2025-32, inflation adjustments for 2026 (section 3.03, maximum capital gains rate) (official)
- IRS: Topic no. 409, Capital gains and losses (official)
- IRS: Topic no. 559, Net investment income tax (official)
Figures come from the data files behind our calculators and update with them. See our methodology and editorial policy. This article is general information, not tax advice.
Frequently asked questions
Is the capital gains rate based on income before or after deductions?
After. The thresholds apply to taxable income, which is income after the standard or itemized deduction. A single filer with only wages and the $16,100 standard deduction can have total income of up to $65,550 (gain included) and still pay 0% on long-term gains. The same limit is $90,350 for a head of household and $131,100 for married couples filing jointly.
Do capital gains push my wages into a higher tax bracket?
No. Your other income is taxed first at the ordinary rates, and the long-term gain is stacked on top at 0%, 15% or 20%. The gain does raise your adjusted gross income, which counts for the net investment income tax and for income-based phase-outs such as the child tax credit.
How long do I have to hold an investment to get the long-term rate?
More than one year. Count from the day after you acquired it up to and including the day you sold it. An asset held one year or less gives a short-term gain, taxed at your ordinary income rates.
Are qualified dividends taxed at the same rates?
Yes. Qualified dividends are taxed at the same 0%, 15% or 20% rates as long-term gains and stack on your income the same way. Other dividends are taxed as ordinary income. The capital gains and dividend tax calculator handles both.
What is the highest federal tax rate on a long-term gain in 2026?
For most assets 20%, plus the 3.8% net investment income tax for higher incomes: 23.8% in total. Collectibles and the taxable part of qualified small business stock gains can be taxed at up to 28%, and unrecaptured section 1250 gain on real estate at up to 25%.
Run your own numbers
- Capital gains tax calculator
Tax on selling stocks, crypto, property or a home, and on dividends: 0/15/20% long-term and qualified dividend rates, short-term rates, 3.8% NIIT, state tax and the main home exclusion.
- Federal tax brackets by year
Current and previous federal tax brackets, standard deduction and key figures, with year-over-year changes.
- Income tax calculator
Federal and state income tax owed for 2026.
- Tax bracket calculator
Your 2026 federal tax bracket from gross or taxable income: marginal and effective rate, the tax from each bracket, the income left before the next bracket and your state marginal rate.