The 2026 capital gains tax brackets are refreshingly simple: three rates, 0%, 15%, and 20%, indexed about 2.7% upward from 2025 under IRS Rev. Proc. 2025-32. The part that trips people up is not the rates. It is the fact that your gains stack on top of your ordinary income, so a raise or bonus in the same year can quietly push part of a sale into the next rate. Run one worked example and the whole system clicks.
What are the 2026 capital gains tax brackets?
These rates apply to long-term gains, assets held more than one year, plus qualified dividends. The brackets measure taxable income, ordinary income plus gains, after deductions, not gross pay or sale proceeds:
| Rate | Single | Married filing jointly | Head of household | Married filing separately |
|---|---|---|---|---|
| 0% | $0 – $49,450 | $0 – $98,900 | $0 – $66,200 | $0 – $49,450 |
| 15% | $49,451 – $545,500 | $98,901 – $613,700 | $66,201 – $579,600 | $49,451 – $306,850 |
| 20% | Over $545,500 | Over $613,700 | Over $579,600 | Over $306,850 |
Two details worth noticing. First, the 15% band is enormous, which is why most investors selling stock or fund positions pay 15% or less on the profit. Second, married filing separately gets the same 0% ceiling as a single filer but hits the 20% rate much earlier, at $306,851 instead of $545,501. Filing status does real work here.
The stacking rule: ordinary income fills the lower portion of your taxable income first, and gains sit on top. This is the single most misunderstood mechanic in capital gains planning, so let us make it concrete.
A worked example: $40,000 of income, $15,000 of gain
Take a single filer with $40,000 of taxable wages and a $15,000 long-term stock gain. Total taxable income: $55,000. The gain stacks on top of the wages, so the 0% rate covers the slice of the gain that fits in the remaining 0% room:
Single, 2026, $15,000 long-term gain
An effective rate of 5.55% on a $15,000 profit. Now the flip side: if that same taxpayer got a $10,000 raise pushing wages to $50,000, the 0% room shrinks to nothing and the full gain is taxed at 15%, tripling the tax to $2,250. That is why tax-loss harvesting and sale timing are not December afterthoughts; they are the whole game.
The two add-ons that raise the real rate
Short-term gains do not get these brackets at all. Sell within a year and the gain is taxed at your ordinary income rate, up to 37%. The one-day-of-patience arbitrage is real: hold past the year mark and the rate roughly halves. The 3.8% Net Investment Income Tax layers on top for high earners, $200,000 MAGI single, $250,000 joint, and those thresholds have never been indexed. A 20% bracket taxpayer in NIIT territory faces 23.8% on gains.
And if you are sitting on losses: up to $3,000 of net capital loss can offset ordinary income per year ($1,500 if married filing separately), with the remainder carrying forward indefinitely. That cap has not moved since 1978, which is either stability or neglect depending on your mood.
Frequently asked questions
- What are the 2026 capital gains tax brackets?
- Three long-term rates: 0%, 15%, and 20%. Single filers pay 0% up to $49,450 of taxable income, 15% from $49,451 to $545,500, and 20% above. Married filing jointly: $98,900 and $613,700. Head of household: $66,200 and $579,600. Married filing separately: $49,450 and $306,850.
- Are the capital gains brackets based on gross income or taxable income?
- Taxable income, after the standard or itemized deduction. Someone earning $60,000 in gross wages can still fall in the 0% capital gains bracket once deductions bring taxable income below the threshold.
- How are short-term capital gains taxed in 2026?
- At ordinary income rates, 10% to 37%. Only assets held more than one year, and qualified dividends, get the preferential 0/15/20% treatment.
- Does the 3.8% Net Investment Income Tax apply to capital gains in 2026?
- Yes, above $200,000 MAGI single or $250,000 joint. In the 20% bracket that makes the effective federal rate 23.8% on gains. Reported on IRS Form 8960.