What Is a Long-Term Capital Gain?
A long-term capital gain is profit from selling an asset held for more than one year. In the United States, long-term gains are taxed at preferential federal rates of 0%, 15%, or 20%, depending on taxable income and filing status, with income thresholds adjusted each year.
How the Rate Is Applied
Long-term gains are stacked on top of ordinary income; the portion falling within each threshold is taxed at that bracket's rate. Higher-income taxpayers may also owe the 3.8% Net Investment Income Tax.
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🔗 Related Terms
More Taxes Terms
- Additional Medicare Tax
- Adjusted Gross Income (AGI)
- Alternative Minimum Tax (AMT)
- Capital Loss
- Child Tax Credit
- Dependent (Tax)
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Last updated: September 27, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.