Capital Gains Tax Rates – State by State – Updated 12/12

One of the “unknowns” in the real estate investing world is the topic of caital gains… in particular… the capital gains tax rates that you and are are subject to.

Truthfully… I’m not sure why I didn’t write a post about this earlier… afterall, I come from the world of tax planning and am the VP of a company who helps sellers of highly appreciated assets defer capital gains taxes.

One huge question that I field from sellers everyday both on this website and at the tax planning firm is, “What are the capital gains tax rates?”… “What will I owe in capital gains taxes?”

The second question is a bit tougher to answer without knowing specificis (I can go over specifics if you want me to… let me know in the comments area), but the first question is pretty simple.

Here we go… to make it simple to read, I’ll just post a chart or two below and get out of your way.

Keep in mind that with the new Democratic Congress, it is likely that capital gains tax rates will rise above the current 15% federal rate.  So the rates below are as of today.

Something my lawyers make me say:
The information on this page is not meant to be tax advice nor should it be taken as gospel.  Consult your own tax advisor about your specific situation.  The numbers below are accurate to our knowledge, but hey… we do make mistakes.  Check with your tax advisor about the actual capital gains tax rate applicable to your situation.

———————

Federal Capital Gains Tax Rates – As of December 2012

Type of Capital Asset Holding Period Tax Rate
Short-term capital gains (STCG) One year or less Ordinary income tax rates up to 35%
Long-term capital gains (LTCG) More than one year 5% for taxpayers in the 10% and 15% tax brackets
15% for taxpayers in the 25%, 28%, 33%, and 35% tax brackets
Collectibles One year or less STCG tax rates up to 35%
Collectibles More than one year 28%
Small Business Stock Gains (Section 1202) More than five years 28% on the gain not excluded
Real Estate Main Home One year or less STCG
More than one year LTCG taxed at 5% or 15% after any exclusion amount www.thereibrain.com

*From IRS.gov

State Capital Gains Tax Rates as of 2007

If you see any errors (don’t think there are any…) please shoot me over the correct info.
Visit www.theREIbrain.com for more quality information like this.
State Top Marginal Capital Gains
Short Term
Capital
Gains
Long
Term
Notes
Alabama 5 5 5
Alaska 0 0 0 No state income tax
Arizona 4.54 5.04 4.54
Arkansas 7 7 4.9 Capital gain rate is 70% of state tax rate for long-term gains
California 10.3 9.3 10.3
Colorado 4.63 4.63 4.63 Allows $1,200 ($2,400 married) credit for capital gains; no tax on capital gains for in-state businesses. Property bought before 1994 or held for 5 yrs has no CO capital gains tax
Connecticut 6.7 4.5 6.7
Delaware 6.75 5.95 6.75
DC 8.95 9 8.95
Florida 0 0 0 No state income tax (high transfer taxes)
Georgia 6 6 6
Hawaii 11.0 8.5 11.0
Idaho 7.8 8.2 7.8 60% reduction in capital gains provided for cap gains produced in Idaho
Illinois 5 3 5 Flat rate
Indiana 3.4 3.4 3.4 Flat rate
Iowa 8.98 8.98 8.98
Kansas 6.45 6.45 6.45
Kentucky 6 6 6
Louisiana 6 6 6
Maine 8.5 8.5 8.5
Maryland 5.5 4.8 5.5
Massachusetts 5.3 12 5.3 Flat rate; long-term gain taxed at lower rates based on length of time security has been held
Michigan 4.35 4.2 4.35 Flat rate
Minnesota 7.85 7.85 7.85
Mississippi 5 5 5
Missouri 6 6 6
Montana 6.9 11 4.9
Nebraska 6.84 6.68 6.84
Nevada 0 0 0 No state income tax
New Hampshire 0 0 0 State income tax on dividends and interest only
New Jersey 8.97 6.37 8.97
New Mexico 4.9 8.2 2.45
New York 8.82 6.85 8.82
North Carolina 7.75 7.75 7.75
North Dakota 3.99 5.54 2.793
Ohio 5.925 6.98 5.925
Oklahoma 5.25 6.75 5.25
Oregon 9.9 9 9.9
Pennsylvania 3.07 3.07 3.07 Flat rate
Rhode Island 5.99 5.1 5.99 25.5% federal tax liability for income and cap gains. State rate applies to federal tax liability.
South Carolina 7 7 3.92
South Dakota 0 0 0 No state income tax
Tennessee 0 0 0 State income tax on dividends & interest only
Texas 0 0 0 No state income tax
Utah 5 7 5
Vermont 8.95 4.8 8.95 24% federal tax liability for income and cap gains. State rate applies to federal tax liability.
Virginia 5.75 5.75 5.75
Washington 0 0 0 No state income tax
West Virginia 6.5 6.5 6.5
Wisconsin 7.75 6.75 5.43
Wyoming 0 0 0 No state income taxVisit www.theREIbrain.com for more information like this.

There you go!

If your transaction applies to the capital gains tax rules in a state with ZERO capital gains tax… CONGRATULATIONS!

If not… either get ready to buck up and fork over a ton of cash to Uncle Sam or start looking for capital gains deferral / reduction options right now before its too late.

Post a comment below if you have questions about some capital gains deferral options and I’ll try to answer them in another post.

Cheers

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About the Author

Hey, my name is Trevor and I'm the founder of The REI Brain and editor/contributor. I started investing in real es.tate when I was 21... and love entrepreneurship, the internet, and real estate. My main focus today is growing my companies, systemizing my businesses so I can work less and make more, and spend more time with my family. Learn more about me at trevormauch.com.

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98 Responses to “Capital Gains Tax Rates – State by State – Updated 12/12”

  1. what about the alternative minimum tax?

  2. Massachusetts Tax Rate is 5.3%, not 5.6%.

    You can also choose to pay optional rate of 5.85% if you like.

  3. Hey Jim,

    Thanks for the update… states laws change so much… it is tough to keep up on the capital gains tax rates.

    So, for everyone out there living in… or with property in Mass… the capital gains tax rate is 5.3%.

    Thanks again Jim!

    Cheers,

    Trevor
    The REI Brain

  4. I’m not sure I understand the long-term capital gain rates shown in your table of states.

    According to this url (http://taxes.about.com/od/capitalgains/a/CapitalGainsTax_4.htm) most states do not have separate capital gains tax rates. Instead, most state will tax your capital gains as ordinary income subject to the state income taxes rates.

  5. Hey Shaggy,

    Yep, you’re right about that. This table shows the high state income tax rate for the states that tax capital gains as ordinary income.

    This chart shows you what you can expect to pay in taxes on your capital gains for each state. So, if the state taxes capital gains as ordinary income… the chart shows the high ordinary income tax rate for that state.

    Keep in mind, I compiled these mid-2007… so be sure to verify with your state before you take this for gospel. If you see any discrepency… let me know.

    Thanks,

    - Trevor

  6. Thank you for the reply, Trevor. So if I understand things, there is no separate capital gains tax for most states, it’s just whatever the regular state tax rate is and you don’t even need to know that rate since it is built into the tax guide’s tax table.

    What about the Consumers Use Tax for Internet purchases that my state keeps trying to make its citizens pay, didn’t Congress explicitly say no taxes on the Internet? Thanks Again.

  7. Hey Shaggy,

    Yep. Most states just tax capital gains as ordinary income… so whatever ordinary income tax bracket you land in that year… that’s what you’re paying.

    As for Consumers Use Tax… no clue about that. I do know that there are some laws that don’t tax digital goods… but do tax hard goods that are shipped.

    Anyhow, I hope that helped!

    - Trevor
    The REI Brain

  8. When making a land sale in arizona but live in illinois which state do you pay capital gains in I was imformed by Arizona state tax office there is no capital gains tax in that state. THANKS Joe

  9. Hey Joe,

    Thanks for the question man! Man… this one isn’t cut and dry… Arizona doesn’t have a “state capital gains tax”, but they do tax residence at their ordinary income tax rate on capital gains… so in other words… they don’t have a special “capital gains tax rate”… but instead just tax capital gains as ordinary income.

    Since you live in Illinois… you’ll have to check w/ them on their capital gains laws. It can get confusing if you live in one state and sell property in another… cause all states have their own unique laws.

    So, get a hold of the Illinois tax department and run the situation by them… I’m telling you right now that you won’t get out of paying state tax on that capital gains… it just might not be called a “capital gains tax”… but it will probably be included in w/ your ordinary income.

    I’m not a CPA… so don’t take this as tax advice… give your CPA a call and give the state of Illinois a call to see what they think.

    Sorry I wasn’t able to completely answer your question… but I hope I was able to help a bit!

    Cheers,

    - Trevor

  10. YES I CHECKED WITH ARIZONA AND THEY SAID IT WOULD BE TAXED AS NON RESIDENT INCOME IN THAT STATE I WILL CHECK AND SEE WHAT THE DEAL IS IN ILLINOIS LUCKILY I AM RETIRED AT AGE 52 AND ON A PENSION IN ILLINOIS ONE OF THE FEW STATES WITCH HAVE NO TAX OR AGE RESTRICTIONS ON PENSIONS OR SOCIAL SECURITY SO AT LEAST IM GETTING A GOOD DEAL THAT WAY. THANKS JOE

  11. I live in TX (no cap gains tax or income tax) and will receive money from a land sale in UT. Will I have to pay capital gains to UT?

    Rachel

  12. Hey Rachel,

    I’m so sorry about the delay in getting back to you… was out of town for a wedding and just got to checking my email this morning.

    Okay…. really I couldn’t answer this one for you. Each state has their own laws… so you might check with Texas and Utah to see what their stance is on taxing sales like that.

    In my experience… if you have income… a state will always try to get their hands into your pockets… so do your research and I wouldn’t be surprised if you do have to pay some type of tax at the state level for the profit you made on your sale.

    Hey, if you would… can you post the answer you find here on this page? That would help out the rest of the community a ton!

    I’m not a CPA… so I apologize about not being able to give you a great answer.

    Hope that helped a bit.

    Cheers,

    - Trevor

  13. Hi, I’m paying 12% in MA on Capital Short Term Gains. Can that be right? I couldn’t believe it. My K-1 income is taxed at 12% just Massachusetts!

  14. Hey Dani,

    Hmmm… I really don’t know a whole lot about Massachusetts tax law. Of course, short term capital gains are taxed differently than long-term capital gains.

    For federal capital gains tax, short term capital gains are taxed 100% as ordinary income… not at the capital gains tax rate. As for Massachusetts… I really couldn’t tell you what the 12% rate is all about.

    Keep in mind, since you owned the property for less than 12 months (which is the definition of a short-term capital gain)… you don’t get the favorable long-term capital gains tax treatment. So… if you want the lower tax, be sure to hold the property for longer than 12 months.

    But… as for whether the 12% tax is accurate… I truly don’t know enough about Massachusetts to give you a solid answer.

    Thanks for the comment!

    - Trevor

  15. Thanks responding so quickly.
    Turbo Tax and others have stated there is a 12% MA short-term Cap Gains

  16. Hey Dani,

    No prob. That must be the case then… aren’t those short-term capital gains a killer?

    Thanks again!

    - Trevor

  17. I live in MA too.

    it makes me want to move to a income tax free state really quickly!!

    First of all Income Tax should be indexed to the CPI, Secondly I don’t see how the government (federal and state) has the authority to impose income taxes.

    If you look at the highest marginal tax rate throughout history it makes you wonder what really caused the great depression to stay that way for so long. Its much like today. We are entering a recession and instead of cutting taxes, everyone of the Dem’s want to increase taxes, for the rich of course. I don’t think you can make it with 2 kids living near Boston and not be “Rich”. http://en.wikipedia.org/wiki/Income_tax_in_the_United_States The only reason why we got out of the depression was because all manufacturing was destroyed all over the world from WWII, except for the USA. And we had an amazing run.

    Even with the housing bust, its very expensive to live a “Simple life”. And inflation is eating up all my savings.

    The best way to lift an economy is to lower spending and cut taxes, which in turn makes us more competitive and more attractive for foreign investment. Tell the fed to stop flooding the market with dollars and convince all government to cut back spending!!

  18. Great insight Liz.

    The Dems do enjoy their taxes. As difficult as it is… a whole lot of problems would be curbed if the government (national, local, and state) were all run like businesses… where efficiency, productivity, and results were a priority.

    Right now is a weird time in the economy because the Fed is trying to “help” out the economy by making money a bit more available… but, that really isn’t helping out the real estate market because… while interest rates are down… people still can’t get loans because of the very tight lending requirements (and lack of loan programs) of today.

    Hmmm… I really couldn’t say what the answer is for the entire economy… I’ll just have to do what I know. No matter what type of economy there is (even the great depression), savvy business people and entrepreneurs still make as much… if not more money than in good/decent economies.

    It’s all in the way we look at things I guess.

    Liz, thanks again for your insight and I agree that the government needs to cut back spending in a big way.

    Thanks!

  19. We’ve had our first house in Omaha, Nebraska since 1975 and paid $19,000 for it; we lived in it till 1997. In 1997 my husband got a job with the city where we had to live in a city residence in a city park. We have rented out our house since 1997 because of this job stipulation. We lived at the city residence until 11/2006 when the city eliminated his job. We bought a new house for $170,000 and moved to this in 11/2006, continuing to rent out our first house. We now want to sell our first house to our daughter for $94,000, paying about $4,000 in closing costs as well as 10% gift equity for the down payment. We’ve put siding, heating/AC system, carpeting, three roofs, and other improvements, etc., on this first house over the years. We still owe $73,000 on this first house, due to refinancing for the down payment for the new one. My question is, what am I looking at for capital gains, ball park figure? And, how can I minimize what we will have to pay? We have never sold a house before and this will be our first experience with capital gains. Thank you!

    Marta

  20. In Florida, an individual owning real estate or a couple owning real estate where they lived for 2 years in a period of 5 years can deduct $250,000 for a single person and $500,000 for a couple from their capital gains.
    Check with an accountant for more information.
    Best regards.
    FD @ Condo Hotel South Beach

  21. I own a house in Myrtle Beach SC. I purchased the house in July 2004. I lived in the house for 2 years (July 04-June 06). Due to marriage I moved to Alabama and changed jobs as well. I could not sell my house. I currently have it rented and I profit $400 above my mortgage payment including tax and insurance. I understand that since it was my primary residence, I will not have to pay capital gains taxes as long as I sell it by July 2009. However, the market is terrible right now. I paid 130K for the home and I have it listed now for 169K, but we have not received any offers. Would it be wise to keep renting it for a few more years and let my 60 month period run out or should I lower my price real low and sell it? What are the pros and cons from a tax standpoint?

  22. Hey Sasha,

    Thanks for the comment!

    Well… the answer here is… It Depends. ;-) .

    First off, I’m not a CPA so be sure to get your own tax counsel to help ya out before you make a decision.

    Well… for me, I would make a decision based on what else I would do w/ the money I earned if I were to sell the property while the capital gains tax exemption is still in effect.

    Basically… what the heck will you do w/ the money if you sell it this year?

    Let’s say you sell it for 169k. Is there a mortgage on the property (I think you said there was)? That of course will have to be paid off, any realtor fees will have to be paid (usually 3-6%… which would be at least $5k), any closing costs (figure a few hundred to a few thousand)…

    That might leave you with $25k-$30k (maybe less) after the sale is all said and done… that is… if you sell it for 169k.

    What would you do with that money after you sold? The stock market isn’t all that safe for the average investor… money markets and CD’s are earning 2-4%…

    Let’s say you put the $30k into something earning a guaranteed 4% (conservative, but realistic)… that would pump out about $1,200 a year in interest.

    Right now, with your rental property you are earning $400/month in positive cashflow which of course works out to be $4,800 a year (not including repairs and maintenance expenses I’m sure)… which is way better than the $1,200.

    Also, yes… the real estate market is in a slump… but unless you have to sell right now… I’d hold onto the property since it’s cashflowing.

    The market WILL come back… it always does. By that time the property should be worth more… you’ll have banked the $400/month in cashflows… and you’ll have awesome tax writeoffs the whole time.

    For me, I’d hold onto it unless you had another investment to put the cash into that would pump out a better return… good luck finding one that is secure as your real estate.

    Anyhow, pros of selling now of course is that you save the about $10,000 in capital gains taxes w/ the exemption.

    Cons are that you lose your tax write offs, you lose the “free” $400 a month in cash flow, you lose any chance to take advantage of the appreciation once the real estate market improves in a few years.

    If it were me, I’d hold onto the property… it doesn’t make sense to sell a property that is producing monthy income and writeoffs just so you can save $10k in taxes.

    I hope that gave you a bit to think about… but as I said… check w/ your CPA to make sure of any tax specifics.

    Chat soon,

    - Trevor

  23. I just moved from California to Nevada. I am planning to sell my CA home within the next two years. I have lived in that home for over 5 years and have been leasing it for over 2 years. Will I get taxed on selling the CA house even though I am a Nevada resident? Or, do I still have to pay the capital gain tax if my profit exceed $250K, unless I do a 1031 exchange?

  24. Hey Janise,

    Truthfully… that question is probably best aimed at your CPA… I’m not a CPA… just a real estate investor.

    But, with my understanding as long as you’ve lived in the home for at least 2 out of the last 5 years you can take advantage of the $250k exemption for a single person… and $500k for a married couple.

    So, as far as federal capital gains tax… that’s requirements and most states follow what the federal tax laws are.

    However, you should check w/ your CPA to make sure that there isn’t some kind of state capital gains tax that the exemption doesn’t apply to (there shouldn’t be but I’m not a tax expert).

    So… check w/ your CPA.

    Thanks!

    - Trevor

  25. If I live in one state, and sell a business or real estate in another state, which state do I pay capital gains in?

  26. Trevor-I currently live in Georgia and I’m selling some land in North Carolina and am considering moving to Florida, in the next few years. If I moved to Florida now, how long do I have to live there, to avoid State long term capital gains taxes? Bill

  27. Hey Bill,

    Hmmm… I’m not sure I can answer that question for you. You may want to chat with your CPA about that one.

    As far as avoiding long-term state capital gains tax… the word “avoid” is inherently a bad word to the IRS. There’s really no way to truly “avoid” long term capital gains tax that I know of completely legally. Yes, there is the $250k exemption for a property you’ve lived in… but if you sell land in North Carolina and you’ve owned it for more than 12 months… there’s a long-term capital gains tax attached to it.

    As far as if you move to Florida and sell while you’re there… and you want to be able to “avoid” the long-term capital gains tax as a result of no income tax in Florida… man… I would check w/ your CPA to find out for sure.

    Sorry I wasn’t able to answer that all the way :-)

    - Trevor

  28. If we were to sell a property in New York City (Manhattan) and have a long term capital gain (we’ve owned the property for over two years)would we mitigate the capital gain if we purchased another property in Rhode Island?

    Thanks!

  29. Hey Philip, like I always tell everyone… I’m not a CPA… so you should go talk to your CPA about this.

    But, here’s my answer…

    The only way you can “mitigate” your capital gains tax by buying another property is usually through a 1031 exchange. So, if you plan on selling your property in New York… then “exchanging” it for another “like-kind” property in Rhode Island… then it should allow you to defer your capital gains tax.

    Get a hold of your CPA to see if this is up your alley… but yes… you can defer your capital gains w/ a 1031 exchange. There are strict guidelines as to what you have to do… so the first place you should start is w/ your CPA.

    Good luck!

    – Trevor

  30. Hello,
    My software business is incorporated in New Jersey (S-Corp). If I want to sell it and retire, is it possible to “move” the company to a state which does not have state income tax – so as to save the 6.37% that NJ charges? Is this considered a legitimate step, and how long would it take to become effective?
    Thanks
    -Pat-

  31. Trevor,
    This is a bit complicated to say the least but hope you can help me. My husband and I own a home that is paid for worth around $80K. We do not live in that home (my sister-n-law does or did). We moved into my father-n-law’s home about 10 years ago and it is worth about 180K.
    We are currentlly in the process of trying to get the home we live in (paid for also)that is still in my fater-n-law’s name and the home we own in his name. He is buying it for the sister-n-law. What is the best way to go about this. What would be the less expensive way to go. We are not paying anything for the house we live in nor are we charging him for the house we own. We just want our name off the title and on the one we live in and his name on the house we own without paying a ton of $ in fees and taxes. Sorry it doesn’t make a whole lot of sense to me but when my in-laws built their latest home 10 years ago everyone in the family just kind of switched houses if that makes any sense.
    Please help!
    Jonleigh

  32. Trevor,
    I forgot to say that we both live in Akron Ohio and as are both homes located. Also can you tell me how much we or how much the father-n-law would have to pay each in taxes if anything.
    Thank you,
    Jonleigh

  33. Hey Jonleigh,

    Thanks for the comment!

    Really… I’m not a CPA so I can’t and don’t feel comfortable doleing out advice on this topic. It’s best just to call up our CPA and pay them for a couple hours of their time to make sure you’re pointed in the right direction.

    Sorry for the not very good answer… but that’s all I got :-)

    – Trevor

  34. Your chart is wrong. The Massachusetts short term capital tax rate is 12% (highest in the nation!) Please update it.

  35. How would one go to avioded these taxes on a capital gains over 500,000.

  36. If I sell a house in NC and lived there less than a year, am I subject to capital gains taxes, even if I roll any gain into a new home? Thanks.

  37. I am married, age 79 and selling my home of 15 years for a profit of about 250,000. I know I’m elligible for the fed capital gain exclusion but what about state (NC) taxes on the sale? Thanks very much. DH

  38. Hey, I hope you can help me. I have 2 tracts of land that equal 34 acres that I paid $30,000 for and I have the opportunity to sell/have logged some of the trees off of that land for $8000. Do I pay Capital Gains Tax on that $8000. I live in North Carolina. Thank you for any help that you can provide.

    Joy Hahn
    Greenville, NC

  39. Thanks for the info. A lot more helpful than the other results that popped up in Google.

    Jarrod
    Marketing Mavens

  40. Recently sold our home, owed and lived in for 10 years, 7 months. The original price was $185,000, + $23,000 worth of home improvemtns, no depreciation. Selling price is $307,000 with $20,000 of real estate fees and lawyer costs. My husband and I will be divorced in 2010 and we file separate tax returns. Do we pay capital gains taxes?

  41. Hi, I was wondering where the data for the state capital gains tax rates was derived. I would love to have this for my firm for 2008 and 2009. Is it available in an easy online format somewhere? Or does it need to be researched on a state by state basis.

    Thanks!
    Nicole Marentes, CPA

  42. Hello…
    My father in-law purchased two cottages in Maine with his brother. Now due to medical complications, he is forced to sell his half of the ownership of the property to his brother. The cottages are beach property which have been used for both personal and some rental purposes.

    He is hoping to avoid as much capital tax as possible. If he sells his share for less than he purchased it for nine years ago, will he have to pay capital gains tax?

    If he is selling the property for more than he owes, but less than he paid, will he have to pay captital gains tax?

    He is currently unemployed and could use additional advice, as everyone seems to tell him something different.

    I look forward to hearing back from you!
    Thanks, Jess

  43. hi trevor,
    1/how about capital gains on foreign owners (resident or non resident) for property owned in florida.
    2/ how about estate taxes on the death of a foreign owner.
    3/ can i get around estate taxes if the property is co-owned and one owner dies
    jim

  44. Hey Trevor. I live in GA, and sold a number of acres in VA recently (09) for $180,000. I am doing a seller’s loan for the buyer, and so I am getting about $1500 a month from him in payment. I just received a 1099 from my Virginia closing attorney, and it merely shows the entire 180K amount. Do you know if I have to pay the entire capitol gains, or just on a pro-rated amount for what I received in payment on the loan last year? Thanks.

  45. We bought a home in 1966 in NJ. We retired and moved to Maine in 2003. The house in NJ was not rented, but occupied by our daughter free of charge. Now we are thinking of selling it.
    How can I figure out a ball park figure of what the capital gains tax will be on this sale?

    MABartsch

  46. hey i have a ?. my grandfather died 3 yrs ago, the estate had a cell tower on it ,closed the tower n dec 09.he lived n ga, tower n tn i also live there.this was sold for 102,000 split 4 ways then my dad will get 5100 also me & my three bros. my mom died so we get part of dads part. we all get 5100 how much fed gains will i pay. there is no tn gains on this.thanks greg

  47. If my grandmother bought a house in 1980 for $50,000 and then in 2006 put it in a trust for me, would the transfer of ownership of the house put the house in the trust at the price of the house in 2006 or the original price of $50,000?

  48. We own 2 homes in oregon one the primary, has a mortage the other is a vacation home no mortage. If I sell the primary which i lived in for 15 yrs, home and rent for a while, then decide to sell the vacation which I have owned for 15 yrs home,will I still have to pay capitol gains on the vacation home if I don’t reside there and never have.And approx. what percent of the selling price will I have to pay in Oregon?

  49. I had a house willed to me ( do not live in it ) I reside at another home with my partner for the past 5 years, this house is in her name and the house willed to i rent out. I live in North Carolina, When I sell the rental home will I owe capital gains taxes ?

  50. I have owned a lot by a lake in Utah for many years but I am a resident of Colorado. If I should sell this piece of property, what should I expect to pay in capital gains taxes and other taxes if I choose to use the proceeds for paying off another piece of real estate and using the rest for other things?

  51. On 3/22/2010 the was an early moring discussion on MSNBC about the tax implications of the new Health Care Bill. It came up during the discusion that New Jersey and California were considering raising the capital gains tax to 60% on gains in excess of $400K. I have e-mailed MSNBC for a clarification but have yet to receive a reply. Have you heard of this tax increase ?

  52. I bought and sold an investment property in state X within the same year, but I live in state Y. Would I have to pay capital gains tax to state X or state Y? Thank you.

  53. Hello Trevor:

    We own a 2 family rental property that has been in my husband’s family for many, many years in New Jersey.

    We also have our primary residence.

    If my husband retirees at age 62, in about 2 more years, will we need to pay capital gains on the 2 family rental. (full or maybe reduced capital gains)?

    I know if need to pay it now, but we were wondering about when he retirees.

    Diane

  54. Sir,
    Hubby’s sister in UT is married for 3rd time; has big Victorian home in Richfield, UT; bought 30 yrs ago (after widowed 11 yrs ago, think there may be a small 2nd on it: say $30,000). She moved with new hubby to Sigurd, UT; now trying to sell Richfield Victorian. Jul 10 is 3rd yr and they are moving back into it to avoid having to pay Capitol Gains taxes on it. Worth of Victorian $150,000).
    1. they do not make enough money to even file for Income Tax
    2. can you give references to contact re: if they would have to pay or not?
    3. In CA, we would not even have to pay CGT because our home is not worth $400,000; in UT, how do i find out for her these answers?

    appreciate any help, thanks.

  55. I’m sure glad Florida has ZERO State Income Tax. If any of you are planning to relocate to the Sunny State of Florida especially the city of Tampa with beautiful Tampa Bay, then you will want to see the rental homes available. Just click my name to watch rental home video tours. Thanks.

  56. the bridge is almost complete and the economy is bottoming out. I have been in Las Vegas since 1968 and we have been thru 5 of these downturns and it is only a matter of time before “this too will pass”
    the mid 80′s was almost as bad

  57. Capital gains taxes are set to increase in 2011. For now the only sure fire way to avoid them is a 1031 exchange. Never sell and let your children worry about them!

  58. How is there such a range in the capital gains tax range. It almost makes me want to move out of my state. Granted I am no where near the highest percent, but it seems ridiculous that some of the states have a 0%. Maybe we will have better roads or something. I still have my doubts though.

  59. Hi there
    so, my brain is bogged down with so many things so please answer me like am a 6 yr old.

    i bought a house(primary residence) in Illinois in March, i have a buyer for it now – if I sell the house after 5 months, how much per $100k will I have to pay in taxes?

    thanks
    -martin

  60. If I was to be bought out of my rent stabilized lease (I live in NY) I was told I would owe long term capital gain. The question is, if the transaction occurs on the first of the new year (2011), and I have by Dec. 31st 2010 moved to florida or new hampshire, would I owe new york state and city tax, as the transaction is based on the transfer of lease rights for a new york home?
    I know that long term capital gain tax, real property taxes, and real estate transfer taxes apply in either case, but I am specifically interested in the state tax issue.

  61. My father passed away in 1975. His will stated that his three children were to inherit his farm equally but our mother was to have life-estate of the income from the farm. Mother died in Jaunary 2007. I sold my 1/3 share of the farm to my brother in 2007. When my husband and I filed our income tax in the State of Iowa the preparer filed a capitol gains deduction. We are now being audited on the capitol gains deduction. Was the preparer in error? Can you help me answer this question?

    Ardy

  62. I live in Oregon, own property in Nevada. Being Nevada has no capital gains tax on a home sale, if I were to sale the Nevada home, then am I taxed being a resident?

  63. Dear Trevor,
    Thank you for all info posted. Very helpful. If I have owned a piece of land in Ny for many years that I want to sell, and I live in D.C,, am over 60 years old and married, what type of capital gains am I looking at having to pay on my land? I own a home in D.c.

    Thank you.

  64. Thanks for the information. We the people are getting gouged worse every year, for trying to better ourselves. I believe that at some point in the future we’ll be in a low enough bracket to take advantage of the lower cap
    gains rates, and they’ll going to roll back the gains tax again, I think it makes a lot of sense to take the profits this year and re-invest the after-tax amount at the new basis.

  65. Curious; if you can tell me, if I made an investment and it made a good return, of say 5000.00 in maybe 2 months, how do I figure the capital gain? Its not realestate, its actually Currency.

    My guess based on the %’s in the charts above would be 35% to feds, and 5.3% Massachusetts?
    Is that correect?
    if so WOW! is there anything I can do about that?

    does the capital gain change with the amount as for the %ages?
    John

  66. I live in MN and I sold property in TN with a long term capital gain. Do I need to pay taxes at MN rates or should I file a TN state tax return? Can I avoid MN LT capital gains all together?

  67. I LIVE IN A STATE THAT HAS A HIGH CAPITAL GAINS TAX. IF I
    MOVE TO A STATE WITHOUT THAT TAX, HOW LONG DO I HAVE LIVE IN THAT NEW STATE?
    THANK YOU

  68. not sure if you can help what are the short term capital gains taxs on money market acct for both fed and the state of colorado on large gains

    thanks

    mark

  69. Can you please send me a more up to date list of states that do not have
    any capital gains tax.
    Thnak You

  70. Hi, Could you please let me know what capital gains I would pay when I sell, I am a foreign investor buying real estate in Arizona? Is there ways to defer it (ie forming a corporation)? Also, what would I pay yearly in tax or gains if I choose to rent it out?
    Any info is greatly appreciated!

  71. Hey Taralea,

    I wish I could tell ya. I’m just a real estate investor… not a tax advisor. You may want to check with a CPA in the state of Arizona to get their take on it. The way I see it… you pay taxes based on where you live… unless there’s a special tax on foreign investors or something. Anyhow, check w/ a good CPA there in Arizona. Good luck!

  72. Hey Mark, for “short-term”… I’m assuming you’re meaning under 12 months… right? Again, I’m not a CPA and this is *NOT* tax advise… but, in my state of Oregon… for money market accounts you just pay normal income tax on that income… for both federal and state. So, your state is probably the same. All short-term capital gains tax is considered “normal income” by most states.

  73. Hey John, this isn’t tax advise… I’m not a CPA… but in most states any gain where the asset was held less than 12 months is considered a short term capital gain. In most states short term capital gains are just taxed as ordinary income. So, that $5,000 gain will just be included in your ordinary income on your tax return and you’ll pay tax on it just like you would your regular income from a job.

    To answer your last question… ya, long-term capital gain rates can change based on your taxable income bracket for that year. Currently… (as I type this) there is still a bracket where you don’t pay any capital gains tax on a long-term gain if you fall into some of the lowest tax brackets… but most people make too much $ to qualify for these tax brackets.

  74. hello,

    I am not retired yet and if my only income is capital gains ( short and long term), do i pay any social security and medicare taxes. And further, this is confusing, since if i don’t pay social security taxes , would i get to collect social security at retirement ( assume i payed these taxes for 1/2 of my working life but due to circumstances i am able to just generate capital gains now until retirement).

    thanks

  75. Hello my parents are in their 70s and are considering selling their home and property.They bought the place in 1957 for 1 dollar,it has been updated many times. They spent alot of money on it ,its a duplex home,theres also a mobile home which i live in, on approximately 3 acres of land in Stevens ,Pennsylvania.This letter is concerning capital gains tax, say they sell it for $150,000 how much would they owe on this tax? thank you, Dennis Fassnacht

  76. We live in California and have a second home in Seattle Washington which we plan to sell. I know we will have to pay federal capital gains tax, but will we be required to pay California capital gains tax also?

  77. As Dani and Mike pointed out, the short term capital gains tax rate for Massachusetts is 12%. (today as well as in 1997)
    Can this table be fixed?

  78. Hey Joseph, thanks for the comments. We just updated it for the short-term capital gains tax rate so its updated now. Thanks!

  79. If I live in Wisconsin and sell a property in another state what capital gain rate do I use??

  80. I was wondering if i sell stock for a short term capital gain and i live in IA do i have to pay both a federal capital gains tax and a state or just a state?

    Thanks

  81. We sold some stock back in July 2011 while living in NV, And became residents of MA on Sept.2011… Do we need to pay taxes over capital gains to the state of MA ?

  82. We leave in NY & second home in Australia which we want to sell.I know we need to pay NY gain tax & with this I also pay the Australian gain tax also.

  83. Nice chart.

    Massachusetts long-term gains are 5.3% for the 2011 tax year.

    http://www.mass.gov/dor/individuals/filing-and-payment-information/guide-to-personal-income-tax/tax-rates.html

  84. Please up date your information. I have just sold a home and am in a 15% tax bracket. What will my capital gains percentage me on the profits from the house in for the year 2012?

    Thanks

  85. I live in KS. and have approx 160 acres of farmland to sell. It was passed down from my grandparents to my parents to me and no money has changed hands since grandpa bought it approx 70 years ago. I want to sell it and am wondering if I can defer the capital gains by paying off my current mortgage and doing improvements to the home like siding, windows, landscaping, adding on a room etc. or should I just bite the bullet, pay the taxes and hope I have enough left over to buy a tank of gas?
    Thanks Trevor,
    Deb

  86. Hey Martha, thanks for the comment! We’re on it! We’re actually publishing a brand new update for 2012 and 2013 state capital gains tax rates… so they’ll all be fresh. Thanks!

  87. Planning to move to Nevada soon. My current regular tax bracket in CA is only 10%. I have the following questions:

    1) I desire to sell my Montana investment real estate for cash. If it were to sell for 4M, what will be my fed cap gains rate on 1M boot after 1031′ing 3M into replacement property?

    2) How long will I have to be a resident of NV to benefit from the 0% state tax? What determines proof of residency?

    Thanks:

    Ed

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