Investors may incur capital losses, meaning that the basis amount was more than the amount they eventually sold the asset for. Capital losses can be used to offset capital gains on taxes, but they must first offset capital gains of the same type. Gains aren’t a guaranteed possibility, however. To calculate capital gains, you’ll need your basis, or the cost of the asset when you paid for it. Short-Term Capital Gains Tax Rates for 2021 In 2022, capital gains tax rates for short term capital gains depend on income tax brackets, which also factor in filing status.įor 2021, short-term capital gains tax rates are as follows: Long-term Capital Gains Tax Rates for 2022 Long-term capital gains tax rates for 2022 are as follows: Short-term gains are taxed as ordinary income.

Short-term capital gains come from assets held for under a year.īased on filing status and taxable income, long-term capital gains for tax years 20 will be taxed at 0%, 15% and 20%. Long-term capital gains come from assets held for over a year. When an investor realizes a capital gain, any proceeds will be considered taxable income.Ĭapital gains vary depending on how long an investor had owned the asset before selling it. Making a profit means the investor now has income, of course, so this must be factored in when filing taxes. Let’s break down the tax rates for your capital gains in 20.Ĭapital gains refers to the money that an investor makes as the profit from selling one or more of their investments or assets.

SPONSORED: Find a Qualified Financial AdvisorĪ financial advisor could help you create a tax plan to maximize your investments. But what some investors may initially neglect to take into account is the fact that investment gains mean investment income, and investment income means taxes on investment income. Investing is all about making your money work for you - getting money without having to actually perform labor.

Capital gains 2022 tax brackets