Hold an asset more than a year and your gain usually gets a break: federal long-term capital gains rates of 0%, 15%, or 20%, instead of ordinary income rates that run as high as 37%. The rate depends on your total taxable income, and the breakpoints are inflation-adjusted every year.
2026 long-term capital gains brackets
| Rate | Single | Married filing jointly |
|---|---|---|
| 0% | up to $49,450 | up to $98,900 |
| 15% | $49,451 to $545,500 | $98,901 to $613,700 |
| 20% | over $545,500 | over $613,700 |
(Married filing separately and head of household use their own thresholds, listed in the IRS release.)
The 3.8% NIIT stacks on top
The Net Investment Income Tax adds 3.8% to net investment income once modified AGI passes:
- $200,000 for single filers
- $250,000 for married filing jointly
- $125,000 for married filing separately
The NIIT thresholds are not inflation-indexed, so they catch more people every year. For a high earner in the 20% bracket, the effective top federal rate on long-term gains is 23.8%.
Two rates that do not follow the table
- Collectibles (art, coins, precious metals) top out at 28%
- Unrecaptured Section 1250 gain (depreciation on real estate) is capped at 25%
The brackets are marginal, and your gain stacks
Your gain does not get its own ladder. Long-term gains sit on top of your ordinary income. A single filer with $40,000 of ordinary taxable income who realizes a $30,000 long-term gain has $70,000 of taxable income; the first $49,450 is in the 0% zone and the rest is taxed at 15%.
Numbers: selling stock
A married couple filing jointly with $90,000 of other taxable income who sell a stock for a $40,000 long-term gain:
- Total taxable income: $130,000
- All of it is under the $613,700 15% ceiling and above the $98,900 0% line, so the gain is taxed at 15%
- Federal LTCG tax: 15% of $40,000 = $6,000 (before any NIIT, which does not apply under $250,000 MAGI)
Short-term gains (assets held one year or less) are taxed as ordinary income, with no special rate.
Disclaimer: This article is general educational information, not tax, legal, or investment advice. Dollar amounts come from the 2026 sources listed at the end of this article and may change. Before you act, talk to a licensed CPA, EA, or tax attorney about your own situation.