What Are Capital Gains?
A capital gain is the profit you make when you sell an investment for more than you paid for it. The tax you owe depends on how long you held the asset.
Use our Capital Gains Tax Calculator to compare your short-term vs long-term tax liability.
Short-Term vs Long-Term
Short-Term Capital Gains
Assets sold within 12 months are taxed as ordinary income — up to 37% for high earners.
Long-Term Capital Gains
Assets held over 12 months get preferential rates: 0%, 15%, or 20% depending on income.
Strategies to Minimize Capital Gains Tax
- Hold for more than a year to qualify for lower long-term rates
- Tax-loss harvesting: Sell losing investments to offset gains
- Use tax-advantaged accounts like 401(k)s and IRAs
- Donate appreciated assets to avoid capital gains entirely
Check your current bracket with our Tax Bracket Calculator. Run scenarios with our Capital Gains Tax Calculator.