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Estimates only — consult a CPA for your specific situation.

Short-Term vs Long-Term Capital Gains

The most important factor in capital gains tax is how long you held the asset. If you held it for 365 days or fewer, the gain is short-term — taxed at ordinary federal income rates (10% to 37%), exactly like wages. If you held it for more than 365 days, the gain is long-term — taxed at preferential rates of 0%, 15%, or 20% based on your income.

For 2026, the long-term capital gains brackets for a single filer are approximately: 0% on income up to $48,350, 15% from $48,350 to $533,400, and 20% above $533,400. Married filing jointly thresholds are roughly double. Critically, LTCG rates apply to the gain stacked on top of your other ordinary income — so if your ordinary income already exceeds the 0% bracket ceiling, all your long-term gains are taxed at 15% or 20%.

RateSingle (2026)Married Filing Jointly
0%Up to $48,350Up to $96,700
15%$48,350 – $533,400$96,700 – $600,050
20%Over $533,400Over $600,050

NIIT, State Tax, and the Section 121 Exclusion

Net Investment Income Tax (NIIT). A 3.8% surtax applies to the lesser of (a) your net investment income (including capital gains) or (b) the amount by which your MAGI exceeds $200,000 (single) or $250,000 (married filing jointly). NIIT is separate from — and additive to — the regular capital gains tax. It can push an effective 15% rate to 18.8%, or a 20% rate to 23.8%.

State tax. State capital gains treatment varies enormously. Florida, Texas, Nevada, Washington (for income), and several others have no state income tax on capital gains. California taxes capital gains as ordinary income — up to 13.3% at the top bracket. This calculator uses a flat state rate with preset rates for all 50 states, which you can override.

Section 121 exclusion. If you sell your primary residence and lived in it for at least 2 of the last 5 years, you can exclude up to $250,000 of gain (single) or $500,000 (married filing jointly) from tax entirely. Only the gain above the exclusion is taxable. This is one of the most valuable tax breaks in the code — for many homeowners, it makes a home sale largely or entirely tax-free.

Worked Example

Scenario: Single filer, $95,000 other ordinary income, sells stock held 18 months for $25,000. Cost basis $10,000, $50 commission. 5% state rate.

  • Gain = $25,000 − $50 − $10,000 = $14,950 (long-term, held > 365 days)
  • 0% LTCG room: $48,350 − $95,000 = $0 (ordinary income already exceeds 0% ceiling)
  • Full $14,950 taxed at 15% → federal LTCG tax = $2,242.50
  • MAGI = $95,000 + $14,950 = $109,950 (below $200,000 NIIT threshold) → NIIT = $0
  • State tax = $14,950 × 5% = $747.50
  • Total tax = $2,990. Net proceeds = $24,950 − $2,990 = $21,960. Effective rate = 20.0%.

Frequently Asked Questions

How is crypto taxed in the US?

Cryptocurrency is treated as property by the IRS, not currency. Every time you sell, swap, or spend crypto, it's a taxable event. If you held the crypto for more than 365 days, the gain is long-term (taxed at 0%, 15%, or 20% depending on income). If you held for 365 days or fewer, it's short-term (taxed at ordinary income rates). Mining rewards and staking income are taxed as ordinary income when received. This calculator models standard buy-sell scenarios; cost basis methods (FIFO/LIFO/HIFO) are not modeled but noted.

Do I owe tax on a stock I haven't sold?

No. Unrealized gains — paper profits on investments you still hold — are not taxed. Capital gains tax is triggered only when you sell, exchange, or otherwise dispose of an asset (a 'realization event'). This is why buy-and-hold strategies are tax-efficient: you defer the tax bill indefinitely and can sometimes avoid it entirely if the assets are passed on at a stepped-up cost basis at death.

How does the wash-sale rule affect my taxes?

The wash-sale rule disallows a capital loss if you buy the same or 'substantially identical' security within 30 days before or after the sale. For example, if you sell a stock at a loss and buy it back 10 days later, the loss is disallowed — it's added back to your cost basis in the replacement shares instead. This calculator does not model the wash-sale rule. Cryptocurrency currently has no wash-sale restriction under existing law, though that may change.

Are capital losses deductible against income?

Capital losses first offset capital gains of the same type (short-term losses vs. short-term gains, etc.), then any remaining losses offset gains of the opposite type. Net capital losses beyond that can deduct up to $3,000 against ordinary income per year. Excess losses carry forward indefinitely to future tax years. Capital loss carryforwards are valuable and worth tracking — consult a tax professional to ensure you're using them optimally.

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