Long-term vs short-term โ the key difference
If you held the asset more than one year, the profit is a long-term gain taxed at the favorable 0%, 15% or 20% rates. Held one year or less, itโs a short-term gain taxed as ordinary income at your regular bracket โ which can be far higher. The holding-period clock starts the day after you buy and ends the day you sell.
2025 long-term capital gains brackets
The rate depends on your total taxable income, because the gain stacks on top of it. 0% applies up to $48,350 (single) / $96,700 (married filing jointly) / $64,750 (head of household); 15% applies above that up to $533,400 / $600,050 / $566,700; 20% applies beyond. A single gain can straddle two bands โ the calculator splits it for you.
What this leaves out
This is federal only. Most states tax capital gains too (California treats them as ordinary income up to 13.3%; nine states have no income tax). High earners also owe the 3.8% Net Investment Income Tax above $200k (single) / $250k (joint) of modified AGI. Losses can offset gains โ net them first before entering the figure here.