long term capital gains tax rate

Long-term capital gains in the U.S. are generally taxed at three federal rates: 0%, 15%, or 20%, depending on your taxable income, filing status, and year, with a few special 25%–28% categories for things like certain real estate recapture and collectibles.

Core idea: what is taxed

• Long-term capital gains apply when you sell a capital asset (like stocks, mutual funds, real estate not used as your primary residence, certain business assets) after holding it for more than one year.

• You owe tax only on the realized gain (sale price minus your tax basis), not on unrealized gains where you still hold the asset.

Current federal long‑term rates (big picture)

• For recent tax years, the standard federal long-term capital gains brackets for most assets have been:
  • 0% for lower taxable incomes
  • 15% for middle ranges
  • 20% for higher incomes

• Which bracket you fall into depends on your filing status (single, married filing jointly, married filing separately, head of household) and your total taxable income for that year.

Example thresholds (recent years)

These are illustrative recent brackets to show how the structure works; each year’s exact dollar cutoffs are adjusted and published by the IRS.

• A single filer:
  • Pays 0% on long-term gains up to a lower-income threshold (around the high‑$40k range in recent years).
  • Pays 15% on gains once taxable income is in a mid-range band (roughly from that threshold into the low‑$500k range).
  • Pays 20% on gains above that upper threshold.

• Married filing jointly has roughly double the 0% threshold, with 15% and 20% kicking in at higher income levels than for single filers.

Because these thresholds change over time (inflation adjustments and law changes), checking the IRS tables or a current-year calculator for the exact numbers for your filing year is essential.

Special higher long‑term rates

Some long-term gains are not capped at 20%:

• Collectibles (art, coins, some precious metals) and certain small-business stock can be taxed at up to 28% even when held more than a year.

• Unrecaptured Section 1250 gain from certain real estate can be taxed at up to 25%.

Other factors to watch

• High-income taxpayers may also owe the 3.8% Net Investment Income Tax (NIIT) on top of these rates once modified adjusted gross income exceeds certain thresholds.

• Harvesting losses, timing sales across calendar years, and managing overall taxable income can legally reduce your effective long-term capital gains tax rate.

For a precise answer for your situation, you would plug in:

1. tax year, 2) filing status, 3) total taxable income (including the gain), and 4) type of asset (regular, real estate, collectible, special stock). Then match those to that year’s IRS long-term capital gains tables.

TL;DR: Most investors pay 0%, 15%, or 20% on long-term capital gains depending on income and filing status, with some special asset types taxed at 25%–28%; exact thresholds shift each tax year and should be checked against the IRS tables for the year you sell.

Information gathered from public forums or data available on the internet and portrayed here.