Washington capital gains tax, 2026
Washington taxes capital gains under its own rule: no income tax, but a 7% tax on long-term gains above a yearly deduction ($278,000 for 2025, the latest published) and 9.9% on taxable gains above $1 million; real estate and retirement accounts are exempt. On a $100,000 long-term gain, a single filer with $80,000 of other income pays $0 of Washington tax, on top of $15,000 federal.
Questions
Does Washington tax capital gains?
Yes, under its own rule: no income tax, but a 7% tax on long-term gains above a yearly deduction ($278,000 for 2025, the latest published) and 9.9% on taxable gains above $1 million; real estate and retirement accounts are exempt.
Does the rule apply to short-term gains?
No. Gains on assets held a year or less are taxed like other income.
State brackets for 2026 from the Tax Foundation; federal rates from IRS Rev. Proc. 2025-32. See every state. Estimates, not tax advice.
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