What are the long-term capital gains tax rates?

The long-term capital gains tax rates are 0%, 15%, and 20%, depending on your income tax bracket. These rates are typically much lower than the ordinary income tax rate. However, the Biden administration has proposed changes to how the capital gains tax is determined.

How much is capital gains tax?

In some cases, the capital gains tax can be almost twice as much as the levy on long-term gains. The IRS considers assets held for longer than one year to be long-term investments. The long-term capital gains tax rates are 0%, 15%, and 20%, depending on your income tax bracket. These rates are typically much lower than the ordinary income tax rate.

When does a holding period start?

The holding period begins ticking from the day after you acquire the asset, up to and including the day you sell it. Ordinary tax rates range from 10% to 37%, depending on your income and filing status. One major exception to the capital gains tax rate on real estate profits is from the sale of your principal residence.