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Investment & Capital Gains Tax

Calculate taxes on investments, capital gains, dividends, RSUs, and crypto

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Investment Tax Workflow

Investment income is taxed differently from earned income, and the difference can be substantial. Long-term capital gains rates (0%, 15%, or 20% depending on your income) are far below short-term rates (up to 37%). Understanding these mechanics before you sell is worth real money.

Step 1: Know Your Holding Period

The most important calculation before selling any investment is whether you've held it for more than one year. Assets held under 12 months are taxed at ordinary income rates. Assets held over 12 months qualify for the preferential long-term rates. If you're close to the 12-month mark, waiting a few more weeks to sell can dramatically reduce your tax bill.

Step 2: Estimate Capital Gains Tax

The Capital Gains Tax Calculator applies the correct federal rate based on your income and holding period. For 2025, the 0% long-term rate applies up to $96,700 (single), making gains tax-free for moderate-income investors in certain years — particularly useful for retirees with low ordinary income during distribution years.

Step 3: Apply Tax-Loss Harvesting

Realized losses can offset realized gains dollar-for-dollar. Losses exceeding gains can offset up to $3,000 of ordinary income per year, with the remainder carrying forward indefinitely. The Wash Sale Rule Calculator helps ensure your harvesting strategy doesn't trigger the 30-day reacquisition rule that would disallow the loss.

Step 4: Plan for NIIT

High earners with MAGI above $200,000 (single) or $250,000 (married filing jointly) owe an additional 3.8% Net Investment Income Tax on investment income above those thresholds. The NIIT Calculator estimates how much of your investment income falls into this surtax zone and quantifies the impact.

Frequently Asked Questions

What is the long-term capital gains tax rate for 2025?

For 2025, long-term capital gains rates are 0% for taxable income up to $96,700 (single) or $193,350 (married filing jointly), 15% up to $533,400 (single) or $600,050 (MFJ), and 20% above those thresholds. High earners may also owe the 3.8% Net Investment Income Tax on top of the 20% rate.

How is crypto taxed?

The IRS treats cryptocurrency as property, not currency. Every sale, trade, or exchange is a taxable event. Gains held under 12 months are short-term (ordinary income rates). Gains held over 12 months are long-term (0/15/20% rates). Mining and staking rewards are taxed as ordinary income at receipt.

What is the wash sale rule?

The wash sale rule disallows a tax loss if you buy the same or substantially identical security within 30 days before or after the sale. The 30-day window extends in both directions — you can't sell a losing stock, claim the loss, and immediately buy it back. The disallowed loss is added to the cost basis of the repurchased shares.

When are RSUs taxed?

RSUs are taxed as ordinary income at vesting, based on the fair market value of the shares on the vest date. Your employer withholds federal and state tax — typically through sell-to-cover, where enough shares are sold to cover the withholding. If your actual tax rate exceeds the withholding rate, you may owe additional tax at filing.

Can I offset capital gains with capital losses?

Yes. Capital losses offset capital gains dollar-for-dollar. Net capital losses up to $3,000 per year can also offset ordinary income. Losses exceeding that $3,000 limit carry forward to future years indefinitely and can offset future gains in those years.