Long Term and Short Term Capital Gains Tax Rate

Posted: November 8th, 2010 under Interested.

Your capital gains tax rate will be figured out depending on the holding period and the type of investment asset. You will be taxed federally on your capital gains and may also be subject to being taxed by your state as well. You will be taxed much higher on short term than long term.

Avoid Long Term & Short Term Capital Gains Tax

This schedule displays the current long term and short term Federal capital gains tax rates:

  • Long Term Capital Gain longer than one year… 5% for taxpayers in the 10% & 15% bracket, 15% if you are in the 25%, 28%, 33%, & 35% bracket
  • Small Business Stock Gains at least five year… 28%
  • Real Estate longer than one year… 5% or 15% after any exclusion amount
  • Collectibles longer than one year… 28%
  • Collectibles longer than five years… 28%

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    Long Term & Short Term Capital Gains Tax Rate

    You will see a change if you are in the 10% or 15% tax bracket. To qualify for this new tax break your income must be below $32,550.00 if you are filing single and less than $65,100.00 if you are married. The new tax rate will be zero for long term capital gains and short term capital gains.

    Tax Rate for Short Term & Long Term Capital Gains

    Long term capital gains are taxed at a lower rate than what your regular income will be taxed at. Depending on your income for that tax year you may be pushed in to a higher tax bracket if you received capital gains. This could result in a combination of rates for your income and capital gains. To learn more about capital gains tax visit TurboTax Online.