No 12 The Instrument · Capital Gains

Your gain,
after tax.

Set the gain, the holding period, and where you live. Every slice is a direct read from the 2026 statutory tables — the 0/15/20% bands, the 3.8% surtax, and your state on top.

Grounded in
IRS Rev. Proc. 2025-32
Key Takeaway · 2026

The single rule that decides everything: hold for more than one year and your gain is taxed at 0%, 15%, or 20%. Sell sooner and it is taxed as ordinary income — up to 37%. The gain stacks on top of your other income, so the same sale can land in different bands.

  • Long-term rates: 0% / 15% / 20%
  • 0% band (single): taxable income up to $49,450
  • NIIT surtax: +3.8% above $200k / $250k MAGI
  • Short-term: ordinary rates, 10%–37%
Capital Gain · Profit on sale
$
$

Your wages and other income after deductions — this sets which bracket the gain stacks into.

$

For the 3.8% NIIT only. Leave blank and we estimate it from your income plus the gain.

Estimated at the top marginal rate. Most states tax gains as ordinary income.

Net After Tax
$35,850
of $50,000 gain
Total Tax
$14,150
Effective
28.3%
Marginal
15%
§ Breakdown · Where the gain is taxed

Stacked on your ordinary income.

The gain sits on top of your $85,000 of other taxable income. Each slice below is the part of the gain falling into that rate band.

RateGain in bandTax
0%
15%$50,000$7,500
20%
13.3%
California state
$50,000$6,650
Total tax on gain$14,150
Marginalia · Source
IRS Rev. Proc. 2025-32 · IRC §1(h) & §1411
Tax year 2026 · Filing status: Single. Long-term figures follow the IRS Qualified Dividends & Capital Gain Tax Worksheet — the gain stacks on your ordinary income. NIIT uses your Modified AGI when entered, otherwise your income plus the gain. State tax is estimated at California's top marginal rate; Washington's separate long-term excise regime (7% / 9.9% over $1M, ~$278k exempt) is modelled directly. Excludes depreciation recapture, collectibles (28%), and QSBS. An estimate, not tax advice.
How It Works

How Capital Gains Tax Is Calculated

There are two systems. Long-term gains — on assets held more than one year — get preferential rates of 0%, 15%, or 20%. Short-term gains — held one year or less — are taxed at the same rates as your salary, from 10% up to 37%. That one-year line is the most consequential decision in capital gains tax.

The subtlety the headline rate hides: long-term gains stack on top of your ordinary income. The IRS fills your tax brackets with wages and other income first, then layers the gain on. So a $50,000 gain can be partly taxed at 0% and partly at 15%, depending on how much room is left in each band. This calculator runs that stacking exactly, then adds the 3.8% Net Investment Income Tax where your income crosses $200,000 (single) or $250,000 (married filing jointly), and estimates your state's bite on top.

What this calculator shows. Enter your gain and income, choose long- or short-term, pick your filing status and state. Every figure — federal tax, NIIT, state tax, effective rate, net proceeds — is computed band-by-band from the IRS Rev. Proc. 2025-32 statutory tables. For the full rules, brackets, and strategies, read the 2026 capital gains guide.

Keep reading
Guide Capital Gains Tax 2026: every rate & bracket Guide Selling your home: the $250k/$500k exclusion Strategy Tax-loss harvesting & the wash sale rule
Method

How We Calculate It

01 — Source of record

Long-term breakpoints and ordinary brackets come from IRS Rev. Proc. 2025-32; the 3.8% NIIT thresholds from IRC §1411. We do not estimate or interpolate the federal figures.

02 — Stacking

Ordinary income fills the brackets first; the gain stacks on top. Long-term gains are split across the 0/15/20% bands by where they land. Short-term gains use the marginal ordinary-rate delta.

03 — State & assumptions

State tax is estimated at your state's top marginal rate. "Other taxable income" is treated as already net of deductions. Excludes depreciation recapture, the 28% collectibles rate, and QSBS.

04 — Not advice

This is an educational estimate, not tax advice. For complex sales — rentals, business stock, inherited assets — consult a professional. See our methodology for citations.