01The holding-period line is more than one year
An asset held for one year or less produces a short-term gain taxed at ordinary federal rates of 10% to 37%. More than one year produces a long-term gain. The holding period generally begins the day after acquisition and includes the disposition day, so use exact dates at the anniversary rather than assuming that “one year” is enough.
For a Single filer with $60,000 of other taxable income, a $20,000 short-term gain in the 22% bracket adds $4,400 before other taxes. The same long-term gain falls in the 15% band and adds $3,000. That $1,400 difference is why the calculator shows a waiting comparison, not just a rate label.
A single day can matter. Verify the acquisition and sale dates before relying on a long-term result.
022026 thresholds and the stacking order
Ordinary taxable income fills the rate structure first. Regular long-term capital gain then uses the remaining 0% and 15% space before reaching 20%. The following are total taxable-income thresholds, not the amount of gain alone.
Source: Rev. Proc. 2025-32 §4.03. Special 25% and 28% buckets follow the Schedule D Tax Worksheet, including its smaller-of comparison with all-ordinary tax.
- Single: 0% through $49,450; 15% through $545,500; 20% above.
- Married Filing Jointly: 0% through $98,900; 15% through $613,700; 20% above.
- Married Filing Separately: 0% through $49,450; 15% through $306,850; 20% above.
- Head of Household: 0% through $66,200; 15% through $579,600; 20% above.
03Basis, capital losses and carryforwards
Start with the amount realized: sale proceeds minus selling costs. Adjusted basis generally includes the purchase price, qualifying acquisition costs and capital improvements, minus allowed-or-allowable depreciation. Economic gain is not always federally recognized gain: exclusions and deductible capital losses come next.
Deductible capital losses offset capital gains, then up to $3,000 of ordinary income in 2026 — $1,500 for Married Filing Separately. Any remaining loss generally carries forward, but the exact amount and its short- or long-term character come from the Schedule D Capital Loss Carryover Worksheet. A loss on a personal residence is nondeductible and cannot offset other gains.
The wash-sale rule can disallow a loss on stock or securities when substantially identical replacements are acquired within the 61-day window beginning 30 days before the sale. An IRA purchase can also create a problem. Remove disallowed losses before entering a loss total; the calculator does not scan transactions or repair basis.
04NIIT uses MAGI, not taxable income
The 3.8% Net Investment Income Tax applies to the smaller of net investment income or modified adjusted gross income above the statutory threshold: $200,000 for Single and Head of Household, $250,000 for Married Filing Jointly, and $125,000 for Married Filing Separately. These thresholds are not indexed for inflation.
Recognized investment gain can enter both NII and MAGI, while gain excluded under §121 or §1202 does not enter NII merely because the sale was large. Depreciation recapture that is recognized can remain in the NII base. Taxable income is after deductions and is not a substitute for MAGI, so Advanced accepts an actual pre-sale MAGI override.
Gain from a genuinely active, non-passive trade or business can be outside NII in some circumstances. That exception is fact-specific; it is not a blanket exemption for landlords, QSBS shareholders or anyone who describes a property as a business.
05Property: recapture before the home exclusion
Equipment, appliances and some cost-segregated components can create §1245 recapture taxed as ordinary income. Long-term unrecaptured §1250 gain from real-property depreciation has a 25% maximum rate. If the property was not held long term, the gain does not receive that special long-term treatment. Use depreciation allowed or allowable, even if it was not actually claimed.
A qualifying principal-residence sale can exclude up to $250,000 of gain, or $500,000 on a qualifying joint return. The general rule requires two years of ownership and use during the five years before sale, with additional limits on prior exclusions and nonqualified use. Depreciation that cannot be excluded is separated before §121 is applied. Married Filing Separately does not receive the $500,000 joint ceiling.
- §1245 recapture: ordinary income, entered separately from building depreciation.
- Unrecaptured §1250: 25% maximum for eligible long-term gain.
- §121 exclusion: applied only after non-excludable depreciation is separated.
- A personal-home loss is not a deductible capital loss.
06Collectibles and crypto are not the same rate problem
Long-term gains on collectibles such as art, rugs, antiques, metals, gems, stamps and certain coins fall into the 28%-rate gain category. That is a maximum, not a promise that every taxpayer pays a flat 28%. The Schedule D Tax Worksheet compares the preferential computation with tax on all taxable income at ordinary rates and uses the smaller result.
Digital assets generally follow property rules. Selling for dollars, exchanging one token for another and spending crypto can all be dispositions with gain or loss. Basis and holding records must follow units across wallets and platforms. Staking or other receipts can create ordinary income before a later capital-gain calculation.
The statutory wash-sale rule refers to stock or securities; do not extend it automatically to every digital asset or assume every token is outside it. Tokenized securities, related contracts and later legislation require current professional review.
07QSBS now depends on acquisition era
Section 1202 qualified small business stock is not a universal five-year checkbox. It requires original-issue stock in an eligible C corporation, active-business and gross-asset tests, and other issuer and taxpayer conditions. The calculator lets you assume those tests are met; it cannot verify them.
The per-issuer limitation is generally the greater of the applicable dollar cap or 10 times qualifying basis. Prior same-issuer excluded gain reduces the dollar cap. The non-excluded portion of a qualifying 50% or 75% exclusion can be 28%-rate gain; cap overflow is not automatically in that same bucket.
Some pre-September 2010 exclusions create a 7% AMT preference. The tool reports that preference but does not pretend it is additional AMT liability. State conformity is separate: California does not conform to §1202, and the state treatment control must be checked for the relevant state and tax year.
Source for the new tiers and caps: P.L. 119-21 §70431. The $15M amount begins inflation indexing only for tax years after 2026.
- Acquired after July 4, 2025: 50% exclusion at 3 years, 75% at 4 years and 100% at 5 years; $15M dollar cap, or $7.5M MFS.
- Acquired September 28, 2010 through July 4, 2025: 100% after more than 5 years; $10M dollar cap, or $5M MFS.
- Acquired February 18, 2009 through September 27, 2010: 75% after more than 5 years.
- Acquired before February 18, 2009: 50% after more than 5 years.
08State, local and return-level limits
Most states include capital gains in taxable income, but rates, deductions, preferential treatment and federal exclusions vary. Washington can tax certain capital gains despite having no broad wage-income tax. The state and local inputs are explicit rate estimates, not a complete resident, part-year or nonresident allocation.
This is a one-sale planning calculator, not Form 8949, Schedule D, Form 4797 or Form 8960. It does not determine wash sales, 1031 exchanges, opportunity-zone deferrals, installment sales, at-risk or passive-loss limitations, actual alternative minimum tax, or every state-specific rule. Use the detailed breakdown as a planning worksheet and reconcile it to transaction records before filing.