Can you tell me the maximum amount a long term capital gain can be before tax action?

Savanna808

question in title

GarrettE

Whether or not capital gains are taxable depends on your total taxable income as a whole, and your filing status. For 2024, if you are single, you have a 0% long term capital gains tax up until $47,025 of taxable income. If you use the status Married Filing Jointly, then you have a 0 percent capital gains tax up to $94,050 of taxable income. And if you are head of household, you have a 0 percent capital gains tax up to $63,000 of taxable income. For other income amounts, you could be subject to a 15 and then a 20 percent long-term capital gains tax. Here is a link to IRS tax topic 409, about capital gains tax. Please note that the numbers they use are from 2023.

Topic no. 409, Capital gains and losses | Internal Revenue Service

CoryF

Thank you for joining our community, Savanna.

Calculating long-term capital gain taxes can be very profitable in terms of how many taxes can be expected. There are three possible levels of taxation based on your wage and possible capital gain income 0, 15, and 20%. This means that you could pay $0 taxes if you fall into the 0% range (below) or 15% of the gain, if you fall into that range. The highest amount of taxes would be the 20% bracket.

You will need to combine the realized gain (proceeds minus cost) of the sale with your other income including wages, which is taxable income, to apply to the following limits:

To qualify for the 0% bracket your taxable income can be up to $47,025 for single and $94,050 for married filing jointly.

To qualify for the 15% bracket your taxable income will fall into the range of $47,026 to $518,900 for singles and $94,051 to $583,750 for married filing jointly.

For taxable income above the high amounts, you will be expected to pay 20% tax on the capital gains from the sale of your assets.

Let us know if this helps.