Question: What is the Capital Gains Tax Rate?
Capital Gains Tax is a tax charged on all capital gains (profits on sales of assets by corporations or individuals).
There are two types of capital gains or capital losses:
- Long-term capital gains/losses, which are gains or losses on assets which are held over one year before being sold
- Short-term capital gains or capital losses, which are gains or losses on assets which are held less than one year before being sold
Answer:
The capital gains tax rate for short-term gains is currently the same as the ordinary income tax rate. The capital gains tax rate for long-term gains was changed to 15% in 2003. This rate was originally set to expire in 2008, but it has been extended through 2010.
According to the IRS, the maximum capital gains tax rate is 15 percent; the minimum capital gains tax rate, for lower income taxpayers, is 0 percent.
