What Are the 2019 and 2020 Capital Gains Tax Brackets?

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Capital gains are the profits you make when you sell an asset such as a stock, real estate, or business. These gains are usually considered taxable income.

Your capital gains tax rate can vary from year to year. That’s because Congress can change the tax brackets, or your income level may change.

You’ll also have to pay a different rate if your capital gains are classed as long or short-term.

  • Short-term capital gains are from any assets that you held for one year or less. They’re taxed at your ordinary-income rate.
  • Long-term capital gains are from any investments you sell after owning for more than a year. These have their own special tax rates, unlike short-term capital gains.

Since the tax rate can change year to year, we’ve broken down the 2019 and 2020 capital gains tax rates for both long- and short-term gains.

2019 Capital Gains Tax Brackets

The 2019 tax rates for short-term gains are 10%, 12%, 22%, 24%, 32%, 35% and 37%. Remember, short-term capital gains are taxed just like ordinary income. Thus, things like your filing status, income and deductions come into play.

2019 Short-term Capital Gains Tax
Tax Bracket/Rate Filing Married Filing Jointly Married Filing Separately Head of Household
10% $0–$9,700 $0–$19,400 $0–$9,700 $0–$13,850
12% $9,701–$39,475 $19,401–$78,950 $9,701–$39,475 $13,851–$52,850
22% $39,476–$84,200 $78,951–$168,400 $39,476–$84,200 $52,851–$84,200
24% $84,201–$160,725 $168,401–$321,450 $84,201–$160,725 $84,201–$160,700
32% $160,726–$204,100 $321,451–$408,200 $160,726–$204,100 $160,701–$204,100
35% $204,101–$510,300 $408,201–$612,350 $204,101–$306,175 $204,101–$510,300
37% $510,301+ $612,351+ $306,176+ $510,301+

For long-term gains, the rates change to 0%, 15% and 20%. These rates are based purely on income levels.

2019 Long-term Capital Gains Tax
Tax Bracket/Rate Single Married Filing Jointly Married Filing Separately Head of Household
0% $0–$39,375 $0–$78,750 $0–$39,375 $0–$52,750
15% $39,376–$434,550 $78,751–$488,850 $39,375–$244,425 $52,751–$461,700
20% $434,551+ $488,851+ $244,426+ $461,701+

2020 Capital Gains Tax Brackets

Always check the tax brackets each year, because they are subject to change. When new tax code is written or new people are elected to Congress, tax codes can change in big and small ways.

And it’s worth remembering that some tax cuts, credits, and rules are written into the tax code for limited time frames, meaning that there comes a time when they expire, and the tax code changes again. So always, always check!

The income brackets for short-term capital gains taxes changed slightly for 2020. Double-check with the table below to see if the changes affect your filing status.

2020 Short-term Capital Gains Tax Brackets
Tax Bracket/Rate Single Married Filing Jointly Married Filing Separately Head of Household
10% $0–$9,875 $0–$19,750 $0–$9,875 $0–$14,100
12% $9,876–$40,125 $19,751–$80,250 $9,876–$40,125 $14,101–$53,700
22% $40,126–$85,525 $80,251–$171,050 $40,126–$85,525 $53,701–$85,500
24% $85,526–$163,300 $171,051–$326,600 $85,526–$163,300 $85,501–$163,300
32% $163,301–$207,350 $326,601–$414,700 $163,301–$207,350 $163,301–$207,350
35% $207,351–$518,400 $414,701–$622,050 $207,351–$311,025 $207,351–$518,400
37% $518,401+ $622,051+ $311,026+ $518,401+

For long-term capital gains taxes, income brackets increased slightly in 2020.

2020 Long-term Capital Gains Tax Brackets
Tax Bracket/Rate Single Married Filing Jointly Married Filing Separately Head of Household
0% $0–$40,000 $0–$80,000 $0–$40,000 $0–$53,600
15% $40,001–$441,450 $80,001–$496,600 $40,001–$248,300 $53,601–$469,050
20% $441,451+ $496,601+ $248,301+ $469,051+

Net Investment Income Tax

The Net Investment Income Tax (NIIT) is a specific tax that applies to people who have a high net investment income. It’s a type of capital gains tax. It’s an additional tax of 3.8% that's added to the long- or short-term capital gains rates.

The NIIT is applied not only to your investment income or sales, but also things like your dividends, rental income, royalty income, and passive income businesses. (This is not an exhaustive list — check with a tax professional for all the areas the NIIT can be applied.)

You’ll have to pay this additional tax if you meet the modified adjusted gross income (AGI) requirements over the thresholds listed below.

2020 Net Investment Income Tax
Filing Status AGI Threshold Amount
Single $200,000
Married Filing Jointly $250,000
Married Filing Separately $125,000
Head Of Household $200,000
Qualifying Widow(er) with Dependent Child $250,000

Check with your tax professional to see if you’ll owe this tax. If you don't have a tax professional, use dedicated tax software for investors.

A Capital Gains Tax Wrap-up

Capital gains taxes are the taxes you pay when you sell an investment for a profit. How much you’ll end up paying will depend on several factors:

  • whether it’s a long- or short-term capital gain
  • the tax brackets for that particular year
  • the amount of your income
  • your filing status
  • the amount you made in capital gains and where you made it

Understanding your own investment sales and income, as well as the capital gains tax rate put forth by the IRS, will help you find out if and what you owe in capital gains.

Kara Perez

Kara Perez is a freelance personal finance writer. She is the founder of bravelygo.co, a company that connects women and money. Kara lives in Austin, TX and believes in the power of budgeting and peanut butter.

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