Unlike ordinary income, such as wages, long term capital gains often benefit from preferential rates designed to encourage long-term investment. How Long Term Capital Gains Are Taxed The tax rate on long term capital gain is not a single flat percentage for everyone.
Organizing Your Records for Long-Term Capital Gains Tax Calculations
It is this aggregation that sometimes pushes a taxpayer into a higher bracket for the year of the sale. For example, selling assets in years when your income is lower can help you take advantage of the 0% rate.
8% tax that applies to the lesser of your net investment income or the amount your modified adjusted gross income exceeds the threshold. 8%) on their gains.
Organizing Your Records for Long-Term Capital Gains Tax Calculations
Because the NIIT applies to investment income, long term capital gains are often subject to this surcharge in addition to the regular federal rate. The thresholds for the NIIT are $200,000 for single filers and $250,000 for married couples filing jointly.
More About Tax rate on long term capital gain
Looking at Tax rate on long term capital gain from another angle can help expand the discussion and give readers a second clear paragraph under the same section.
More perspective on Tax rate on long term capital gain can make the topic easier to follow by connecting earlier points with a few simple takeaways.
