(NewsNation) — Income thresholds for capital gains taxes are increasing next year, meaning some investors could pay less tax on their profits.
The IRS announced updated capital gains tax brackets for 2026 on Thursday as part of its annual inflation adjustments.
IRS announces income tax brackets, standard deductions for 2026
The higher taxable income limits outlined below apply to long-term capital gains — profits from assets held for more than one year.
There are still three tax rates — 0%, 15% and 20% — which are determined by income and filing status. Higher earners pay a larger share of tax on their long-term investment gains.
For tax year 2026, a single filer with a taxable income of $49,450 or less qualifies for the 0% long-term capital gains rate — up about 2.3% from $48,350 in 2025. Married couples filing jointly will be eligible for the 0% rate with taxable income of $98,900 or less in 2026.
Taxes on crypto: How much could you owe this year?
Remember, you only pay long-term capital gains tax on your profits, not the total amount from the sale of the asset.
Short-term capital gains — profits from assets held less than a year — are taxed at your ordinary income rate, and those income thresholds are also increasing as part of the annual inflation adjustments.
Thursday’s announcement applies to tax year 2026, meaning the changes will affect investments you sell for a gain during the next calendar year.
Long-term capital gains rates by taxable income and filing status for 2026
Filing statusTaxable income for 0% rateTaxable income for 15% rateTaxable income for 20% rateSingle$0 to $49,450$49,451 to $545,500$545,501 or higherMarried filing jointly $0 to $98,900$98,901 to $613,700$613,701 or higherHead of household $0 to $66,200$66,201 to $579,600$579,601, or higher
