Finance Calc App

US Capital gains tax calculator

Short and long-term capital gains tax estimates by region.

By Mitch Duncan Last reviewed Methodology

Your gain

Est. tax owed
$3,750.00
Net gain
$21,250.00
Effective rate
15.0%

Estimates only

Capital gains tax depends on your full tax picture, allowable losses, deferrals, and local rules not modelled here. Consult a tax professional before filing.

Want the full picture? How to Reduce Capital Gains Tax: 9 Legal Strategies →

How US capital gains tax is calculated

A capital gain is profit from selling an asset for more than its cost basis:

Capital gain = sale price − cost basis − selling expenses

In the US, how long you held the asset is everything — it's a hard one-year cliff.

Worked example (long-term)

Buy 100 shares at $50 ($5,000 basis). Sell after 2 years at $90 ($9,000), $20 commission.

Sold at 6 months instead, the whole gain is taxed at your ordinary rate (22%) = $876 — nearly 50% more for selling early.

Short-term vs long-term

Wash-sale rule and basis

You can't claim a loss if you buy a substantially identical security within 30 days before or after the sale — the loss is disallowed and added to the new basis. Track cost basis carefully, including reinvested dividends, or you'll overpay tax on phantom gains.

Common mistakes

What this doesn't cover

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Key terms

Cost BasisCapital GainsTax-Loss HarvestingCapital Loss Full glossary →

Frequently asked questions

What's the difference between short-term and long-term capital gains?
Short-term gains (assets held one year or less in the US) are taxed as ordinary income at your marginal rate — up to 37%. Long-term gains (held over one year) get preferential rates of 0%, 15%, or 20% depending on income. The UK, Canada, and Australia have different rules — Australia gives a 50% discount on assets held over 12 months, for example.
How is capital gains tax calculated?
Gain = sale price − cost basis − selling expenses. The gain is then taxed at the applicable rate (short- or long-term in the US; ordinary income with a 50% inclusion in Canada; 50% discount in Australia; flat 10/18/20/24% bands in the UK after the annual exempt amount). The calculator above handles each market's rules.
Do I owe capital gains tax on my primary residence?
US: usually no, up to $250,000 of gain ($500,000 married filing jointly) if you've lived there 2 of the last 5 years. UK: principal residence is generally exempt under Private Residence Relief. Canada: principal residence is fully exempt. Australia: main residence is generally exempt with caveats around use and ownership period.
Can I offset capital gains with losses?
Yes — capital losses offset capital gains, and excess losses can offset some ordinary income ($3,000/year in the US; £0 — UK losses carry forward indefinitely against gains; Canada and Australia carry forward losses indefinitely). 'Tax-loss harvesting' — deliberately realising losses to offset gains — is a common end-of-year strategy.

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