By Stephen Milner · UtilityForge · Last reviewed: May 2026
The federal capital gains tax rate is 0%, 15%, or 20% for long-term gains in 2025, depending on your taxable income and filing status. Short-term gains are taxed as ordinary income at 10%–37%. High earners also owe a 3.8% Net Investment Income Tax surcharge. Rates are set by IRS Revenue Procedure 2024-40 and apply to tax year 2025 returns.
This calculator applies those rate schedules to your specific income and gain, using the IRS stacking method, to give you an accurate federal tax estimate before you sell.
The single most important factor in capital gains taxation is how long you held the asset.
Short-term gains come from assets sold within one year of purchase. They are taxed at your ordinary income rate, the same rate as wages and salaries. For 2025, that ranges from 10% to 37% depending on your income and filing status.
Long-term gains come from assets held for more than one year. They qualify for preferential rates: 0%, 15%, or 20%. For most middle-income investors, the long-term rate is 15%. The difference is significant: a $50,000 gain taxed at 22% (short-term) costs $11,000 in federal tax; the same gain taxed at 15% (long-term) costs $7,500.
The IRS applies capital gains rates using a stacking approach. Your ordinary income fills the lower brackets first. The capital gain sits on top and is taxed at the rate corresponding to the combined income level.
For example: a single filer with $40,000 of ordinary income and a $30,000 long-term gain has a combined taxable income of $70,000. The 0% bracket for single filers ends at $48,350. That means $8,350 of the gain is taxed at 0% (filling the bracket from $40,000 to $48,350), and the remaining $21,650 is taxed at 15%. Total capital gains tax: $3,247.50, an effective rate of about 10.8% on the gain.
Without the stacking calculation, it is easy to over- or under-estimate your tax.
High earners owe an additional 3.8% NIIT on capital gains above certain income thresholds: $200,000 for single filers, $250,000 for married couples filing jointly, and $125,000 for married filing separately. This applies to the lesser of the capital gain amount or the amount of modified AGI above the threshold.
A married couple filing jointly with $240,000 of income and a $50,000 long-term gain has combined income of $290,000. The $40,000 above the $250,000 threshold is subject to NIIT: $40,000 × 3.8% = $1,520. The capital gains tax (at 15%) applies to the full $50,000 gain: $7,500. Total federal tax on the gain: $9,020.
Long-term capital gains brackets for tax year 2025:
| Filing status | 0% up to | 15% up to | 20% above |
|---|---|---|---|
| Single | $48,350 | $533,400 | $533,400+ |
| Married Filing Jointly | $96,700 | $600,050 | $600,050+ |
| Married Filing Separately | $48,350 | $300,000 | $300,000+ |
| Head of Household | $64,750 | $566,700 | $566,700+ |
These are thresholds for taxable income including the capital gain. Short-term gains use the same ordinary income brackets as wages: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. Source: IRS Revenue Procedure 2024-40.
This tool calculates federal tax only. Most states also tax capital gains, either at ordinary income rates or a flat rate. Florida, Texas, Washington, and a handful of other states have no state income tax.
For real estate sold as a primary residence, the Section 121 exclusion ($250,000 single, $500,000 married) may reduce or eliminate the taxable gain. This tool does not apply that exclusion.
For depreciation recapture on rental property sales (taxed at a maximum 25% rate), or collectibles (maximum 28% rate), results from this tool will not reflect those special rules. Consult a tax professional for complex situations.
For long-term gains (assets held over one year), the 2025 federal rates are 0%, 15%, or 20% depending on taxable income and filing status. Single filers pay 0% on gains that keep total income under $48,350, 15% up to $533,400, and 20% above that. High earners also owe a 3.8% NIIT on top. Short-term gains are taxed as ordinary income at 10% to 37%.
Short-term applies to assets held one year or less; they are taxed at ordinary income rates (10%–37%). Long-term applies to assets held more than one year; they receive preferential rates of 0%, 15%, or 20%. The cutoff is based on the exact date of purchase and the date of sale.
Enter your taxable income before adding this capital gain: after the standard deduction or itemized deductions but before the gain. This is the figure that appears on line 15 of Form 1040, minus the gain you are modeling.
The Net Investment Income Tax is a 3.8% surtax on capital gains (and other investment income) for taxpayers whose modified AGI exceeds $200,000 (single or head of household), $250,000 (married filing jointly), or $125,000 (married filing separately). It applies to the lesser of net investment income or the amount by which MAGI exceeds the threshold.
No. State capital gains taxes vary widely. California taxes all gains as ordinary income, while Florida has no income tax. Add your state's rate separately to get a full picture.
You can use it for investment property sales. However, if you are selling a primary residence, the Section 121 exclusion ($250,000 single, $500,000 married) may eliminate much or all of your taxable gain. This calculator does not apply that exclusion. Use a dedicated home sale capital gains calculator for primary residence transactions.
Long-term capital gains rates were set below ordinary income rates as an incentive for long-term investment. The tax code treats gains on assets held over one year as fundamentally different income from wages, with rates capped at 20% (or 23.8% including NIIT) even for the highest earners, compared to 37% for ordinary income.
The calculator handles this automatically using the stacking method. Your ordinary income fills the lower brackets first. The gain is stacked on top and taxed starting from where your ordinary income ends. If a large gain spans multiple brackets, each portion is taxed at the applicable rate.
Yes. Gains from collectibles (art, coins, wine) are taxed at a maximum 28% federal rate. Depreciation recapture on real estate is taxed at a maximum 25% rate. Both are beyond the scope of this calculator, which covers the standard capital assets: stocks, ETFs, mutual funds, bonds, and similar securities.