Transparent method
The formula
Worked example
Example inputs
How to interpret the result
The gain being taxed is proceeds minus basis minus selling costs, not the sale price alone, and basis is often more than the original purchase price once improvements, reinvested dividends or prior adjustments are factored in. Leaving basis understated overstates the taxable gain, sometimes substantially, on an asset held for years with several additions to its cost along the way.
Before you rely on it
What to check
Confirm your basis figure includes every legitimate addition, improvements, reinvested distributions, adjustments, not just the original purchase price.
The common error
Where people go wrong with capital gains tax calculator
Using the original purchase price alone as basis on an asset that's had capital improvements or reinvested distributions added over time. That understatement inflates the taxable gain beyond what's actually owed.
Sensitivity evidence
How estimated tax rate changes the estimated capital-gains tax
| Estimated tax rate | Estimated capital-gains tax | Taxable gain |
|---|---|---|
| 11.0% | $2,090 | $19,000 |
| 13.0% | $2,470 | $19,000 |
| 15.0%worked example | $2,850 | $19,000 |
| 17.0% | $3,230 | $19,000 |
| 19.0% | $3,610 | $19,000 |
Every input, tested
Which input moves the estimated capital-gains tax most
| Input | Tested from | To | Estimated capital-gains tax at each end | Swing |
|---|---|---|---|---|
| Sale proceeds | $45,000 | $55,000 | $2,100 to $3,600 | $1,500 (53%) |
| Adjusted tax basis | $27,000 | $33,000 | $3,300 to $2,400 | $900 (32%) |
| Estimated tax rate | 13.0% | 17.0% | $2,470 to $3,230 | $760 (27%) |
| Selling costs | $900 | $1,100 | $2,865 to $2,835 | $30 (1.1%) |
Two variables at once
Estimated capital-gains tax by estimated tax rate and sale proceeds
| Estimated tax rate \ Sale proceeds | $40,000 | $50,000 | $60,000 |
|---|---|---|---|
| 11.0% | $990 | $2,090 | $3,190 |
| 13.0% | $1,170 | $2,470 | $3,770 |
| 15.0% | $1,350 | $2,850 | $4,350 |
| 17.0% | $1,530 | $3,230 | $4,930 |
| 19.0% | $1,710 | $3,610 | $5,510 |
Step by step
The worked example, input by input
| Input | Value used |
|---|---|
| Sale proceeds | $50,000 |
| Adjusted tax basis | $30,000 |
| Selling costs | $1,000 |
| Estimated tax rate | 15.0% |
| Estimated capital-gains tax | $2,850 |
| Taxable gain | $19,000 |
Where the inputs come from
Sale proceeds are what you received, adjusted tax basis is what you paid plus improvements and reinvested dividends, and selling costs are commissions and fees. The tax rate depends on your holding period and income: assets held over a year get long-term rates of 0%, 15% or 20% depending on taxable income, while shorter holdings are taxed at ordinary rates. Add 3.8% for the net investment income tax if your income is above the threshold. Get basis from your brokerage's cost-basis report.
Using the estimated capital-gains tax in a real decision
Compare after-tax proceeds when choosing among assets to sell.
When the result stops applying
A single flat rate is a simplification, since a gain can span more than one rate band. Special rates apply to collectibles and depreciation recapture on real estate. The home sale exclusion, inherited assets with stepped-up basis and gifts have different rules. State taxes add to the total. Losses can offset gains and up to $3,000 of ordinary income.
What to compare it with
Plan losses with the tax-loss harvesting calculator, and check the stock and crypto profit calculators for the pre-tax result. The federal income tax page shows how gains stack on ordinary income. The tax-equivalent yield calculator compares taxable and tax-free returns.
People also ask
Frequently asked questions
What is the long-term capital gains tax rate?
Generally 0%, 15% or 20% depending on taxable income, for assets held more than a year. Short-term gains are taxed at ordinary income rates.
How do I find my cost basis?
Look at your broker's cost-basis report or trade confirmations, and add commissions and improvements. For inherited assets, basis is usually the value at the owner's death.
Can losses reduce my capital gains tax?
Yes. Losses offset gains of the same year, and up to $3,000 of excess loss offsets ordinary income, with the rest carried forward.