Capital Gains Tax Estimator

How to calculate Capital gains tax calculator?

Calculate tax by determining the capital gain from the sale and then applying the applicable tax rate based on holding period and filing status.

Key formula: capital_gains_tax = max(0, (sale_price - selling_expenses - purchase_price - purchase_expenses)) * (tax_rate_percent / 100)

Using the Capital gains tax calculator calculator: an example

Example values below show a typical long-term sale and the resulting tax.

Step-by-step calculation:

• Sale price = $250,000; Selling expenses = $5,000.
• Purchase price = $180,000; Purchase expenses = $2,000.
• Capital gain = 250,000 - 5,000 - 180,000 - 2,000 = $63,000.
• Assuming long-term tax rate = 15%, Capital gains tax = 63,000 × 0.15 = $9,450.

Frequently Asked Questions

What determines short-term versus long-term treatment?

Holding period is the key factor: assets held one year or less are typically short-term and taxed at ordinary income rates; assets held longer usually qualify for long-term rates.

Are selling and purchase expenses deductible from the gain?

Yes. Reasonable costs directly related to buying or selling the asset reduce the capital gain and should be subtracted when calculating the taxable gain.

What if the calculation produces a loss?

If the result is a capital loss, no capital gains tax is due. Losses may be used to offset other capital gains or deducted against income subject to local tax rules.