Capital Gains Tax Rates for 2026

Selling an investment is one of the few moments when you decide how much tax you pay. The rate depends on how long you held the asset, your other income and your filing status, and in some cases a surtax. This guide covers the rules for the 2026 tax year, using the figures published by the IRS in Revenue Procedure 2025-32, and ends with practical ideas for timing sales before year-end. Use the capital gains calculator to run your own numbers.

Short-term versus long-term

A capital gain is the difference between what you sold an asset for and its basis, usually what you paid for it plus certain costs. If you owned the asset for one year or less, the gain is short-term and taxed as ordinary income at 10%, 12%, 22%, 24%, 32%, 35% or 37%. If you owned it for more than one year, the gain is long-term and taxed at 0%, 15% or 20%. The holding period starts the day after you acquire the asset, so a purchase on March 3, 2025 becomes long-term on March 4, 2026. For stocks, the trade date, not the settlement date, determines the holding period, and for publicly traded securities the trade date also decides which tax year a sale belongs to, so a sale executed on the last trading day of December is a 2026 sale even though cash arrives in January.

The 2026 long-term rates and thresholds

These thresholds are applied to taxable income, which is your income after the standard or itemized deduction, and the gains themselves count as the top slice. Say you are single with $40,000 of taxable income before a $30,000 long-term gain. The first $9,450 of the gain fills the 0% range up to $49,450, and the remaining $20,550 is taxed at 15%, for $3,082.50 of tax. If you waited and sold $9,450 this year and the rest next year, the whole $9,450 would be tax-free; the thresholds reset each year.

The 3.8% net investment income tax

On top of income tax, a 3.8% net investment income tax (NIIT) applies to the smaller of your net investment income and the amount by which your modified AGI exceeds $200,000 (single, head of household), $250,000 (married filing jointly) or $125,000 (married filing separately). These thresholds are not indexed for inflation, so more taxpayers are caught every year. A married couple with $282,000 of AGI and a $100,000 gain would owe the NIIT on $32,000, or $1,216. Wages are not net investment income, but gains, dividends, interest and passive rental income are. The IRS explains the details on its Net Investment Income Tax page.

Special rates

• Collectibles such as art, coins and precious metals are taxed at up to 28% when held long-term.
• Unrecaptured section 1250 gain from depreciation on real estate is taxed at up to 25%.
• Qualified small business stock may be partly or wholly excluded under section 1202 if requirements are met.
• Home sales. You can exclude up to $250,000 of gain ($500,000 for joint filers) on your main home if you owned and lived in it for two of the last five years.
• Qualified dividends follow the same 0%, 15% and 20% rates as long-term gains.

Losses

Capital losses first offset capital gains, short-term against short-term and long-term against long-term, then each other. If the total is a net loss, you can deduct up to $3,000 against ordinary income ($1,500 for married filing separately), and carry any excess forward. Selling a loser deliberately to offset a gain is called tax-loss harvesting, covered in a separate guide.

Gifts, inheritances and basis

Basis determines your gain, and it varies by how you got the asset. Assets you inherit generally receive a stepped-up basis equal to the fair market value on the date of death, so the gain accrued during the decedent’s lifetime is not taxed. Gifts keep the donor’s basis for gains. Appreciated stock given to a charity avoids the gain altogether, which is why donating appreciated shares is often better than selling and donating cash. Always keep trade confirmations, because brokers report basis only for most assets purchased in recent years.

Planning ideas before December 31

• Check your 0% room. If your taxable income is below the thresholds, you can sell appreciated assets and rebuy them to raise your basis without federal tax. Watch for knock-on effects on ACA subsidies, student financial aid and state taxes.
• Hold past one year. If a position is a few weeks from the one-year mark, waiting can cut the rate dramatically. A $20,000 gain taxed at 24% is $4,800; at 15% it is $3,000.
• Pair gains with losses. Realize losses in the same year as gains where it makes sense for your portfolio.
• Watch fund distributions. Mutual funds often pay out capital gains in November or December. Check the distribution schedule before buying in a taxable account late in the year.
• Spread large sales. If you are selling a business or property, splitting the sale across two years may keep more of it in the 15% bracket and below the NIIT threshold.

A worked comparison

Consider a single filer with $60,000 of taxable income who is thinking about selling $20,000 of gain from a stock bought in 2024. Because that income is already above the $49,450 threshold for the 0% rate, a long-term gain would be taxed entirely at 15%, or $3,000. Had the same shares been held for less than a year, the gain would be taxed at 22% for the portion up to the top of the 22% bracket ($105,700 of taxable income), or $4,400. If the filer instead waits until January, a new year’s thresholds apply, and a different mix of income may put more of the gain in the 0% range. The difference between those outcomes is why it pays to estimate your income before you click sell.

Reporting and paperwork

Your broker sends Form 1099-B showing proceeds and, for most recent purchases, your basis and whether the gain is short- or long-term. You report each sale on Form 8949 and total them on Schedule D. If you use specific-lot identification, you can choose which shares to sell, such as the highest-basis lots, to reduce the gain; set this with your broker before you place the order because the default method is usually first-in, first-out. Keep confirmations for any sale where the broker may not have your basis, such as shares transferred in from another firm or received as a gift.

What this guide does not cover

State taxes are separate and can be significant; most states tax gains as ordinary income. Cryptocurrency, employee stock plans, installment sales and like-kind exchanges have their own rules. If you hold substantial unrealized gains, talk to a tax professional before selling.