Tuesday, July 26, 2011
No Federal Capital Gains Tax?
For the years 2008 through 2012, the federal long term capital gains tax rate is 0% if you belong in the income tax bracket of 10% or 15%. Those who are in the 25% income tax bracket or higher are still subject to a 15% long term capital gains tax rate. You are in the income tax bracket of 10% or 15% if you have a taxable income of $67,900.00 or less if you are married filing jointly, or a taxable income of $33,950 or less if you are filing single. Taxable income is not the adjusted gross income ("AGI"), but the income after accounting for standard or itemized deductions and the number of exemptions for your household usually found on the second page of the IRS form 1040. Going forward from year 2013, the long term capital gains tax rate is 10% for taxpayers in the 10% or 15% income tax bracket, and 20% for taxpayers in the 25% or higher income tax bracket.