Federal rules for readers across the U.S.
Capital Gains Tax Rates 2026
Educational information only, not personalized tax, legal, or investment advice. Christian is a licensed insurance agent (NC Life & Health), not a CPA or registered investment adviser. Discuss your own situation with a qualified professional.
Long-term or short-term
The holding period decides the rate. Sell an asset you held more than one year and the gain is long-term, taxed at 0, 15, or 20 percent. Sell within a year and the gain is short-term, taxed as ordinary income at rates from 10 to 37 percent. The clock runs from the day after you buy to the day you sell. Losses can offset gains, and up to $3,000 of net capital losses can offset ordinary income each year, or $1,500 if married filing separately.
The 2026 thresholds
The rate depends on your total taxable income, not on the size of the gain alone. Your wages, pension, and IRA withdrawals fill the lower bands first, and the gain stacks on top. For 2026 the 0 percent rate applies to taxable income up to $49,450 single or $98,900 joint. The 15 percent rate runs to $545,500 single or $613,700 joint, and 20 percent applies above that. Heads of household get 0 percent up to $66,200 and 15 percent up to $579,600. These figures come from IRS Revenue Procedure 2025-32.
The 3.8 percent net investment income tax
On top of the capital gains rates, a 3.8 percent net investment income tax can apply to the lesser of your net investment income or the amount of modified AGI above $200,000 single or $250,000 joint. Those thresholds are fixed by law and are not adjusted for inflation. That can bring the top federal rate on a long-term gain to 23.8 percent. This is educational information, not tax advice. A tax professional can work out how the surtax applies to your return.
How gains stack on other income
Retirement income fills the bands first. Required minimum distributions, pensions, and part-time wages all count as taxable income before your gain is figured. That is why a retiree with a modest gain can still owe 15 percent: the RMDs and Social Security already used up the 0 percent room. Selling in a year with lower other income, or spreading sales across years, changes which band the gain lands in. Run the numbers before you sell, not after.
| Your taxable income | The rate |
|---|---|
| Single, up to $49,450 | 0 percent |
| Single, $49,451 to $545,500 | 15 percent |
| Single, above $545,500 | 20 percent |
| Joint, up to $98,900 | 0 percent |
| Joint, $98,901 to $613,700 | 15 percent |
| Joint, above $613,700 | 20 percent |
Your records checklist
- Check whether you held the asset more than one year.
- Add up your other taxable income first, since it fills the lower bands.
- Check the 3.8 percent surtax thresholds of $200,000 single or $250,000 joint.
- Keep purchase records and sale confirmations for your cost basis.
- Ask a tax professional before selling, especially if the sale is large.
Common questions
- Do I pay capital gains tax if my income is low?
- Possibly nothing. If your total taxable income stays under $49,450 single or $98,900 joint in 2026, long-term gains are taxed at 0 percent federally. State tax can still apply.
- Are short-term gains taxed the same way?
- No. Gains on assets held one year or less are taxed as ordinary income, at rates from 10 to 37 percent in 2026.
- Does North Carolina tax capital gains at 0 percent too?
- No. North Carolina taxes capital gains as ordinary income at its flat 3.99 percent rate for 2026. The federal 0 percent rate does not carry over to the state return.
Sources and current instructions
Check the tax year and any later updates before acting. These are the primary sources used for this guide.