Methodology and sources

Every federal figure is computed by code twice: band by band, as the IRS worksheet stacks a gain on other income, and again ten dollars at a time, each slice taxed at the rate of the place it lands. The two must agree.

Sources

• The 0% and 15% thresholds, brackets and standard deductions for 2026: IRS Revenue Procedure 2025-32.
• The 3.8% net investment income tax: the IRS page on the tax.
• State brackets and standard deductions for 2026: the Tax Foundation's state income tax tables.
• The home sale exclusion: IRS Topic 701.

States with their own rules

Most states tax a gain as ordinary income. For the states that do not, the Tax Foundation describes each rule; we add a state's figure only after checking its rule against the state's own tax authority or statute, and show the rule without a figure until then. The check matters: New Mexico's 40% deduction now applies only to the sale of a New Mexico business, so a sale of shares gets at most $2,500. Washington's 2026 deduction is not published yet; we use the $278,000 of 2025.

Limits

The calculator assumes the gain is your only investment income for the 3.8% tax, covers single and joint filers, and does not include local income taxes, the alternative minimum tax, itemized deductions or credits. New York and Connecticut take back the benefit of their lower brackets at high incomes, so for large gains their tax is higher than the brackets alone show.

Checked on 02.10.2026. If you find an error, please tell us.