Tax Rate On Capital Gains
This article is for educational purposes only, we do not provide tax advice, and for further information and any questions on tax rate on capital gains should be directed towards a CPA professional. Capital gains tax is payable when you sell an asset that has increased in value since you bought it. You might receive a tax bill if you sell your shares, although this will depend on whether the gain was made through income or other gains. You may also have to pay capital gains tax when selling your home, depending on the value. The first $250,000 per person, with a max of 2, is exempt but any gains beyond this are taxable.
Capital gains are split into short-term and long-term gains. Short-term gains are any profits made when selling an asset that you have owned for a year or less. These are taxed at your standard income tax rate.
Long-term gains cover profits on any asset that you have held for over a year, including your home. The rate changes depending on your taxable income and your filing status, the information below is subject to change and may change per your personal tax situation:
- 0% - Any single person with a taxable income of $40,400 or less ($80,800 if joint filing).
- 15% - Any single person with a taxable income of $40,401 to $445,850 ($80,801 to $501,600 if joint filing).
- 20% - Any single person with a taxable income of $445,851 or more ($501,601 or more if joint filing).
It is your responsibility to ensure that you report all capital gains on your tax return so they are taxed accordingly. If you fail to do this, you could be on the receiving end of a large fine. If you are looking to coordinate between your CPA and MortgageQuote.com, then have them reach out to us so we may be prudent and strategize together.