There are a few other exceptions where capital gains may be taxed at rates greater than 20%: However, a capital gains rate of 20% applies to the extent that your taxable income exceeds the thresholds set for the 15% capital gain rate.

more than $59,750 but less than or equal to $523,050 for head of household.

more than $89,250 but less than or equal to $553,850 for married filing jointly and qualifying surviving spouse and.

more than $44,625 but less than or equal to $276,900 for married filing separately.more than $44,625 but less than or equal to $492,300 for single.$89,250 for married filing jointly and qualifying surviving spouse andĪ capital gains rate of 15% applies if your taxable income is:.$44,625 for single and married filing separately.For taxable years beginning in 2023, the tax rate on most net capital gain is no higher than 15% for most individuals.Ī capital gains rate of 0% applies if your taxable income is less than or equal to: Net capital gains are taxed at different rates depending on overall taxable income, although some or all net capital gain may be taxed at 0%. The term 'net long-term capital gain' means long-term capital gains reduced by long-term capital losses including any unused long-term capital loss carried over from previous years. The term “net short-term capital loss” means the excess of short-term capital losses (including any unused short-term capital losses carried over from previous years) over short-term capital gains for the year. The term 'net capital gain' means the amount by which your net long-term capital gain for the year is more than your net short-term capital loss for the year. If you have a net capital gain, a lower tax rate may apply to the gain than the tax rate that applies to your ordinary income. To determine how long you held the asset, you generally count from the day after the day you acquired the asset up to and including the day you disposed of the asset. For exceptions to this rule, such as property acquired by gift, property acquired from a decedent, or patent property, refer to Publication 544, Sales and Other Dispositions of Assets for commodity futures, see Publication 550, Investment Income and Expenses or for applicable partnership interests, see Publication 541, Partnerships. If you hold it one year or less, your capital gain or loss is short-term. Generally, if you hold the asset for more than one year before you dispose of it, your capital gain or loss is long-term. To correctly arrive at your net capital gain or loss, capital gains and losses are classified as long-term or short-term. Losses from the sale of personal-use property, such as your home or car, aren't tax deductible. You have a capital loss if you sell the asset for less than your adjusted basis. You have a capital gain if you sell the asset for more than your adjusted basis. Generally, an asset's basis is its cost to the owner, but if you received the asset as a gift or inheritance, refer to Publication 551, Basis of Assets for information about your basis. When you sell a capital asset, the difference between the adjusted basis in the asset and the amount you realized from the sale is a capital gain or a capital loss.

Examples of capital assets include a home, personal-use items like household furnishings, and stocks or bonds held as investments.

Almost everything you own and use for personal or investment purposes is a capital asset.

Irs tax table for 2020