Capital Gains Tax Calculator
Hold an asset twelve months and a day and the tax treatment changes completely — from ordinary income rates to the preferential long-term rates of 0%, 15% or 20%. This shows both outcomes side by side so the cost of selling early is visible.
The Sale
Federal tax only. State capital gains tax, where it applies, is additional.
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One day decides the rate
An asset held for exactly twelve months is short-term. Twelve months and one day is long-term. Short-term gains are taxed as ordinary income — potentially 37% federal. Long-term gains sit at 0%, 15% or 20% depending on total taxable income. For a higher earner that is often a swing of 17 percentage points on the same gain.
The 0% bracket is real and widely missed
Long-term gains are taxed at 0% while total taxable income stays under the first threshold. For a single filer that threshold is around $49,000 of taxable income. Anyone in a low-income year — a career break, a sabbatical, early retirement before pensions start — can realise gains completely tax-free up to that line. Deliberately doing this to reset a cost basis upward is known as gain harvesting.
The surtax people forget
Net Investment Income Tax adds 3.8% on investment income above $200,000 (single) or $250,000 (married filing jointly). It applies on top of the capital gains rate, so the true top federal rate on long-term gains is 23.8%, not 20%. This calculator includes it.
Losses offset gains, and a little income too
Realised capital losses offset realised gains dollar for dollar. If losses exceed gains, up to $3,000 a year can be deducted against ordinary income, and anything beyond that carries forward indefinitely. Note the wash-sale rule: repurchasing a substantially identical security within 30 days disallows the loss.