Capital Gains Tax Rate

The capital gains tax rate you pay depends on many factors. Your capital gains tax rate can be between 5% and 28%. However, for most people, the capital gain tax rate they pay is either 5% or 15%.

What is my capital gains tax rate?

Low income tax payers pay the low capital gains tax rate of 5%. High income tax payers pay the higher capital gains tax rate of 15%.

These capital gains tax rates were reduced from 20% and 10% respectively in May 2003 when a change in capital gains tax law was introduced. This change in capital gains tax law was amended in May 2006.

Everyone can now enjoy their low capital gains tax rate through 2010. Below is a summary of who pay what capital gains tax rate.

Who pay the 5% capital gains tax rate?

Usually tax payers in the 10% - 15% income brackets with long term capital gains pay the 5% lowest capital gains tax rate.

Who pay the 15% capital gains tax rate?

Usually tax payers in the 25% or higher income brackets with long term capital gains pay the 25% lowest capital gains tax rate. This capital gains tax rate is most widely paid and is considered low compared to the previous capital gains tax rate.

Who pay the 25% capital gains tax rate?

This capital gains tax rate applies to the capital gains from depreciated real estate properties.

Who pay the 28% capital gains tax rate?

You would only be subject to this capital gains tax rate if you either have capital gains from the sale of small business stock or collectibles.

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