Capital gains tax in United States 2026

Hold an asset more than one year and the federal rate on the gain drops to 0%, 15% or 20% by income — 23.8% at most with the investment surtax. Sell within a year and the gain is ordinary income at up to 37%.

Homeowners exclude $250,000/$500,000 of main-home gain, heirs receive a full basis step-up at death, and qualified small business stock can be 100% exempt.

Capital losses offset gains fully and up to $3,000 of ordinary income a year, carrying forward forever.

At a glance

top rate: 23.8% (20% + 3.8% surtax) on long-term gains; 37% short-term
entry band: 0% up to $49,450 single / $98,900 joint
tax year basis: Calendar year
filing deadline: 15 April return; estimated payments during the year
residency basis: Citizens/residents: worldwide gains
regime flag: Step-up in basis wipes out gains at death

Rates

Capital gains rates (2026)

Rate	Base	Applies to
0% / 15% / 20%	Net long-term gain	Assets held over 1 year — thresholds $49,450/$545,500 (single), $98,900/$613,700 (joint)
Ordinary rates to 37%	Net short-term gain	Assets held 1 year or less
28% / 25%	Gain	Collectibles / depreciation-recapture portion of real estate
0%	—	Main-home gain to $250,000/$500,000; qualified small business stock up to 100% (held 3–5+ years, caps $10–15 million)

Thresholds & allowances

Loss allowance$3,000 of ordinary income offset per year
After netting against gains; unlimited carryforward
Like-kind exchangesTax deferred on swaps of business/investment real estate
Section 1031 — real property only
Step-up at deathHeirs' basis resets to market value
Lifetime gains die with the owner — the core US estate-planning fact

Surcharges

Net investment income tax3.8%over $200,000 single / $250,000 joint

Residency

Residency trigger

Citizens and residents pay on worldwide gains; the one-year holding clock is the single most valuable timing rule in US investing.

Non-resident treatment

Non-residents pay no US tax on most capital gains — stocks included — unless present 183+ days. US real estate is the exception: gains are taxed under the foreign-owner property rules (FIRPTA) and buyers withhold (typically 15% of the price) at closing — with statutory exceptions where the buyer will use the home: 0% at or under $300,000 and 10% between $300,001 and $1 million.

Notes

The wash-sale rule blocks loss harvesting if you rebuy the same security within 30 days.
State taxes typically hit gains at ordinary state rates — up to 13.3% extra in California; Washington State charges 7% above $250,000 despite having no wage tax.
Qualified small business stock issued after 4 July 2025 earns 50%/75%/100% exclusions at 3/4/5 years, with a cap of $15 million or 10× basis.
Expatriating citizens and long-term green-card holders face a deemed sale of everything above a $910,000 gain exemption (2026).

FAQ

What is the US capital gains tax rate?

For assets held over a year: 0%, 15% or 20% by income, plus 3.8% surtax at high incomes — 23.8% top federal. Within a year: ordinary rates up to 37%. States add their own layer.

Do foreigners pay US capital gains tax on shares?

Generally no — non-residents are exempt on US stock gains unless they spend 183+ days in the US that year. US real estate is different: FIRPTA taxes the gain and roughly 15% of the sale price is withheld at closing — with statutory exceptions where the buyer will use the home: 0% at or under $300,000 and 10% between $300,001 and $1 million.

What happens to capital gains when someone dies?

They vanish: heirs take a stepped-up basis equal to market value at death, so a lifetime of appreciation escapes income tax entirely — one reason the $15 million estate exclusion matters so much.

Figures: tax year 2026, compiled from public sources. Not tax advice.

See capital gains tax in other countries

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