US Capital Gains Tax Calculator

Hold an investment for one year or less, gains are 'short-term' and taxed as ordinary income at your marginal rate (10-37%). Hold for more than a year, gains are 'long-term' and taxed at preferential rates of 0%, 15%, or 20%. On a $50,000 gain, the difference between selling on day 364 vs day 366 can be $7,500-10,000 in tax.

The day-count is from the day after you bought to the day you sold. There is no way to backdate or extend the clock. The single biggest avoidable tax mistake retail investors make is selling profitable positions at month 11 of holding when waiting another month would convert short-term to long-term.

For 2024, single filers pay 0% on long-term gains up to $47,025 of taxable income, 15% from $47,026 to $518,900, and 20% above. Married filing jointly: 0% to $94,050, 15% to $583,750, 20% above. The 0% bracket is genuinely real - retired couples with modest income can sell appreciated stock and pay literally zero federal tax on the gain.

Stacking matters: capital gains sit on top of ordinary income for bracket purposes. If you have $90,000 of wages and $20,000 of long-term gains, the full gain is taxed at 15% (because wages already used up the 0% gain space). High earners over $250k single / $250k MFJ also pay an extra 3.8% Net Investment Income Tax on top.

Capital losses offset capital gains dollar-for-dollar in the same year. Realised losses beyond gains can offset up to $3,000 of ordinary income per year, with the remainder carried forward indefinitely. Selling a losing position to crystallise the loss before year end is 'tax-loss harvesting' and can save thousands.

Watch the wash-sale rule: if you sell at a loss and buy 'substantially identical' securities within 30 days before or after, the loss is disallowed and gets added to the cost basis of the replacement. Index funds and ETFs of similar but distinct underlying baskets (S&P 500 vs total US market) are usually treated as different enough; identical tickers across different brokers are not.

Sell your primary home and the first $250,000 (single) or $500,000 (married) of gain is excluded from tax under Section 121, provided you owned and lived in it for 2 of the last 5 years. Investment property does not get this exclusion but can use a 1031 exchange to defer the gain into another investment property indefinitely.

Depreciation recapture catches investment property sellers off guard. The depreciation you took (or should have taken) over the years gets recaptured at up to 25% on sale, separate from regular capital gains rates. A rental sold for a $200,000 gain after $80,000 of depreciation owes 25% on the $80,000 plus long-term rates on the remaining $120,000.