Here are the 2027 capital-gains tax rates for each income level

By Andrew Keshner

How much will you pay in capital-gains taxes next year? The IRS just released this crucial information.

What investors should know for capital-gains tax rules next year.

Stock investors are getting their first look at capital-gains taxes for next year now that the IRS has released the 2027 capital-gains tax tables.

The tax rates on many investment profits are the same: 0%, 15% and 20%. What's changing are the income ranges for when those rates kick in.

Like income-tax brackets, these ranges adjust with inflation. The IRS unveiled its updates for 2027 on Thursday. The tax collector also released its numbers for income-tax brackets and the standard deduction.

One draw for investment profits are these preferential tax rates of 0%, 15% and 20%. That's compared to wages, which are taxed from 10% to 37%. There's still fine print for investors when it comes to capital-gains taxes.

For starters, an asset needs to be held at least one year before a sale. The money made from a purchase and sale within a year are taxed as ordinary income.

Stock returns, qualified dividends and profits from a bond sale can be subject to long-term capital gains. The same goes for profits from cryptocurrency sales.

There are tax wrinkles to consider for savers and investors who are trying to play the higher interest-rate environment.

Capital-gains taxes do not apply to the interest paid on banking products, like a high-yield savings account or a bank CD. Those proceeds count as ordinary income. The tax rules for interest income on bonds vary, depending on the type of bond and where the taxpayer lives.

Here's what to know for capital gains in 2027:

 
Filing status              0% rate    15% rate    20% rate 
Individuals                $51,050*   $563,200*   Over $563,200 
Married filing jointly     $102,100*  $633,600*   Over $633,600 
Head of household          $68,350*   $598,400*   Over $598,400 
* Maximum taxable income 

The IRS inflation adjustments happened to come on a day of sharp trading losses on Wall Street SPX. That might make it difficult to to think about stock gains.

But bear in mind that capital losses offset the tax bill from capital gains. If losses exceed gains, investors can claim a capital-loss deduction up to $3,000. Any excess capital loss can be carried over to future years.

The $3,000 capital-loss deduction limit is not indexed to rise with inflation and hasn't increased in decades.

One investment tax that isn't changing

The 3.8% net investment-income tax is an extra tax on proceeds including interest, dividends, long- and short-term capital gains, rental and royalty income. The tax has been in place since 2013 and its thresholds do not move with inflation.

That's not a bug. It's a feature of the tax.

Individuals may owe the tax once they report these qualifying proceeds and their income is over $200,000. For married couples, the threshold is $250,000.

This gradually makes the tax reach more households over time - especially as more people have become invested in the stock market in the past decade.

Just over 8 million income-tax returns paid the tax in 2023, totaling more than $39 billion, according to the Bipartisan Policy Center. More than 3 million returns paid $16.5 billion on the tax when it started a decade earlier, according to a Congressional Research Service report.

-Andrew Keshner

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11-05-26 1848ET