Capital Gains Tax Calculator

Capital gains are the profits you earn when you sell an investment or asset for more than you originally paid. The gain equals your selling price minus your cost basis (what you paid plus any transaction fees). If you sell for less than you paid, you have a capital loss instead.

Short-term capital gains come from selling assets held for one year or less. They are taxed at your regular income tax rate, which can be as high as 37%. Long-term capital gains come from assets held longer than one year and are taxed at preferred rates of 0%, 15%, or 20% depending on your income.

For 2024, long-term capital gains rates are 0% for lower incomes, 15% for most taxpayers, and 20% for high earners. Short-term gains are taxed at ordinary income rates ranging from 10% to 37%. High-income earners may also owe an additional 3.8% Net Investment Income Tax.

Cost basis is what you paid for an investment, including purchase price, commissions, and fees. For inherited assets, the cost basis is typically the fair market value on the date the previous owner passed away. Accurate cost basis records reduce your taxable gain when you sell.

Reinvesting does not eliminate capital gains tax. You still owe tax on the gain from the sale. However, strategies like tax-loss harvesting, using tax-advantaged accounts (401k, IRA), or holding investments longer than one year can help reduce your overall tax burden.

Capital losses occur when you sell an asset for less than you paid. You can use capital losses to offset capital gains dollar for dollar. If your losses exceed your gains, you can deduct up to $3,000 per year against ordinary income and carry the rest forward to future years.

Yes. Short-term losses first offset short-term gains, and long-term losses first offset long-term gains. Any remaining net losses can then offset the other type of gain. This strategy, called tax-loss harvesting, is a common way to reduce your annual tax bill.