Capital Gains Tax Calculator
Estimate your federal tax liability on the sale of stocks, real estate, and other investments based on current tax brackets.
Enter your transaction
to calculate tax liability
Holding Periods & Tax Rates
How long you own an asset drastically changes how your profits are taxed by the IRS.
Short-Term Gains
Held for 1 year or less
Profits are taxed exactly like your regular income (your paycheck). The gain is added to your total income for the year, and taxed at your marginal Ordinary Income Tax Bracket (ranging from 10% to 37%).
Long-Term Gains
Held for more than 1 year
The IRS rewards long-term holding with preferential tax brackets. Depending on your overall taxable income and filing status, your profits are taxed at exactly 0%, 15%, or 20%.
Frequently Asked Questions
What is a capital gain?
A capital gain is the profit realized from the sale of a property or an investment. It is calculated by subtracting the purchase price (and any associated fees or improvements) from the final sale price. If you sell it for less than you bought it, it's considered a capital loss.
What is the difference between short-term and long-term capital gains?
"Short-term" means you held the asset for one year or less before selling it. Short-term gains are taxed at your ordinary income tax rates, which can be up to 37%. "Long-term" means you held the asset for longer than one year. These gains are taxed at much more favorable rates of 0%, 15%, or 20% depending on your income.
Do I have to pay capital gains tax on the sale of my primary residence?
Often, no. If you have owned and lived in the house as your primary residence for at least two of the five years preceding the sale, you can typically exclude up to $250,000 of the gain from your income ($500,000 if married filing jointly). This is known as the Section 121 exclusion. This calculator does not automatically apply this exemption.
What is the Net Investment Income Tax (NIIT)?
The NIIT is an additional 3.8% tax that applies to certain net investment income of individuals, estates, and trusts that have income above the statutory threshold amounts ($200,000 for single filers, $250,000 for married filing jointly). This calculator includes NIIT in its estimates for long-term gains if your income triggers it.
Does this calculator include state income taxes?
No. This calculator provides an estimate for Federal Capital Gains taxes only. Most states (with a few exceptions like Texas, Florida, Nevada) also tax capital gains as ordinary income, which would add to your total tax liability.
More Tax & Investment Tools
Explore more calculators to understand your finances and plan your tax strategy.
Michigan Income Tax Calculator
Calculate Michigan state income tax, effective rate, marginal rate, and detailed analysis.
Connecticut Tax Calculator
Calculate Connecticut state taxes, federal taxes, and net pay with progressive brackets.
Dividend Yield Calculator
Calculate the annual return on investment from stock dividends based on share price.
Investment APY Calculator
Calculate Annual Percentage Yield to find the true return on your investments over time.
Wage Garnishment Calculator
Calculate federal wage garnishment limits for child support, debt, and tax levies.
Stock Average Calculator
Calculate your new average cost basis when buying more shares of the same stock.
Suggested hashtags: #taxes #investing #capitalgains #stocks #realestate #finance