Capital gains tax
TaxesDefinition
US tax on profits from selling assets (stocks, real estate, crypto). Two rates depending on holding period:
Short-term (held ≤ 1 year): taxed as ordinary income (10-37%).
Long-term (held > 1 year): preferential rates of 0%, 15%, or 20% based on income (2025: 0% up to ~$48K single / $96K married; 15% up to ~$533K single / $600K married; 20% above).
Plus 3.8% Net Investment Income Tax above ~$200K/$250K. State taxes apply on top in most states (CA tops out near 13%).
Short-term (held ≤ 1 year): taxed as ordinary income (10-37%).
Long-term (held > 1 year): preferential rates of 0%, 15%, or 20% based on income (2025: 0% up to ~$48K single / $96K married; 15% up to ~$533K single / $600K married; 20% above).
Plus 3.8% Net Investment Income Tax above ~$200K/$250K. State taxes apply on top in most states (CA tops out near 13%).
Example
You buy a stock at $50K, sell at $80K → $30K gain. Held 14 months, single, $150K income → 15% federal LTCG = $4,500 tax. If sold at 11 months → ordinary income at 24% = $7,200. The 1-month difference saved $2,700.
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