Federal tax

Capital gains tax rates for 2026 and 2025

Profit on something you held for more than a year is a long-term capital gain, taxed at 0%, 15% or 20% depending on your taxable income. For 2026 a single filer pays 0% up to $49,450 of taxable income and a married couple up to $98,900. Gains on things held a year or less are taxed like wages, at the regular brackets.

Long-term capital gains brackets

The rate depends on your total taxable income, including the gain. Qualified dividends use the same rates.

Taxable income up to which each rate applies. 2025 from Rev. Proc. 2024-40, 2026 from Rev. Proc. 2025-32. Above the 15% limit the rate is 20%.
Filing status	0% (2025)	15% (2025)	0% (2026)	15% (2026)
Single	$48,350	$533,400	$49,450	$545,500
Married filing jointly	$96,700	$600,050	$98,900	$613,700
Head of household	$64,750	$566,700	$66,200	$579,600
Married filing separately	$48,350	$300,000	$49,450	$306,850

Worked example

A single filer has $60,000 of wages and sells stock held for three years at a $20,000 gain in 2026. After the $16,100 standard deduction, wages leave $43,900 of taxable income, and the gain brings the total to $63,900.

The 0% rate covers income up to $49,450, so the first $5,550 of the gain is tax-free. The other $14,450 is taxed at 15%: about $2,168 of federal tax on the $20,000 gain.

Short-term vs long-term

How long you owned it decides which rates apply.

Long-term: you held the asset more than one year. Count from the day after you bought it up to and including the day you sold it.
Short-term: one year or less. These gains are taxed at your ordinary income tax rates, from 10% to 37%.
Inherited property counts as long-term no matter how briefly you held it, and its basis is generally the value on the date of death.

Higher rates and the 3.8% surtax

Some gains are taxed above 20%, and high earners pay an extra tax on top.

Collectibles such as coins, art and precious metals: up to 28%.
The taxable part of a gain on qualified small business stock: up to 28%.
Depreciation taken on rental or business real estate (unrecaptured section 1250 gain): up to 25%.
Net investment income tax: an extra 3.8% on investment income, including capital gains, when modified AGI is over $200,000 single or head of household, $250,000 married filing jointly, or $125,000 married filing separately.

Selling your home

You can exclude up to $250,000 of gain on your main home, or $500,000 on a joint return, if you owned it and lived in it for at least two of the five years before the sale. Only gain above that is taxed, at the capital gains rates. A loss on your home is not deductible.

Capital losses

Selling at a loss lowers your tax.

Losses first offset your gains for the same year.
If losses are bigger than gains, you can deduct up to $3,000 a year against other income ($1,500 if married filing separately).
Anything left over carries forward to later years.
Losses on personal-use property, such as your car, are not deductible.

How to report it

Sales go on Form 8949 and Schedule D of your Form 1040. Your broker sends Form 1099-B with the sale price and usually the cost; crypto platforms now report sales on Form 1099-DA. Check that the cost basis is right, because a missing basis makes the whole sale look like profit.

Illinois

Illinois has no separate capital gains rate. Gains are part of your Illinois income and taxed at the flat 4.95%, so a long-term gain in Illinois pays the federal rate plus 4.95%.

Selling stock, crypto, a rental or a home?

USTAXX checks your cost basis, reports the sale on Form 8949 and plans the timing so more of the gain lands at 0% or 15%. In Naperville, IL, or remotely.

Tax consulting and planning Book a consultation (847) 773-7070

Questions people ask

What is the capital gains tax rate for 2026?

0%, 15% or 20% for long-term gains. A single filer pays 0% up to $49,450 of taxable income, 15% up to $545,500, and 20% above that. Short-term gains are taxed at ordinary rates.

How long do I have to hold an asset for long-term rates?

More than one year. Count from the day after you bought it to the day you sold it.

Do I pay capital gains tax when I sell my house?

Not on the first $250,000 of gain ($500,000 married filing jointly) if you owned and lived in it for two of the last five years.

How much capital loss can I deduct?

Up to $3,000 a year against other income ($1,500 if married filing separately), with the rest carried forward.

Are capital gains taxed in Illinois?

Yes, as regular income at the flat 4.95% rate. Illinois has no lower rate for long-term gains.

Where these rules come from

General information, current when written, not advice about your situation. Fees and forms change; the official pages above are the authority.