Capital Gains Tax by State 2026: Interactive Map + Calculator

Federal long-term capital gains (held over 1 year) are taxed at 0%, 15%, or 20% based on taxable income. For 2026, the 0% bracket extends up to $48,350 single / $96,700 married filing jointly; 15% up to $533,400 single / $600,050 MFJ; 20% above those thresholds. Short-term gains (held under 1 year) are taxed as ordinary income at federal rates up to 37%. Most high earners also owe the 3.8% Net Investment Income Tax (NIIT) on top of these rates, kicking in at $200,000 MAGI single / $250,000 MFJ — making the effective top federal rate 23.8% on long-term gains and up to 40.8% on short-term gains.

Eight states have no state-level capital gains tax in 2026: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, and Wyoming. Important caveat — Washington also has no state income tax on wages, but DOES have a tiered capital gains tax (7% on gains $270K-$1M, 9.9% above $1M per SB 5813 retroactive to January 1, 2025). New Hampshire's I&D tax was fully repealed January 1, 2025. Tennessee's protection is constitutional (Amendment 3 of 2014) and uniquely strong — it extends to local governments. The other no-CGT states rely on sales tax, property tax, severance taxes (Alaska and Wyoming), or tourism taxes (Nevada, Florida) to fund state operations.

Yes. Washington imposes a tiered capital gains tax under RCW 82.87 — 7% on long-term gains above $270,000 per individual (the threshold is indexed annually) up to $1,000,000, then 9.9% on gains above $1M per SB 5813 (signed May 2025, retroactive to January 1, 2025). This is technically classified as an excise tax (Quinn v State, Washington Supreme Court March 2023) rather than income tax — a legal distinction that allows it to coexist with Washington's constitutional ban on graduated income taxes. Additionally, ESSB 6346 (signed by Governor Ferguson March 30, 2026) adds a 9.9% state income tax on household income above $1M effective January 1, 2028. Many real estate sales are exempt (primary residence under federal exclusion rules; commercial real estate is taxable). Citizen Action Defense Fund has stated it will challenge the new 2028 tax.

California has the highest state capital gains tax in 2026 at 13.3% top marginal rate, including the 1% Mental Health Services Tax (MHST) surcharge on income above $1 million. New Jersey follows at 10.75%, then New York at 10.9% (NYC residents add another 3.876% local tax for a combined 14.776%), DC at 10.75%, Oregon at 9.9%, Minnesota at 9.85%, Washington at 9.9% above $1M, and Hawaii at 11% ordinary or 7.25% alternative LTCG cap. California treats capital gains as ordinary income with no preferential rate, so the full 13.3% applies. Combined with federal 20% LTCG + 3.8% NIIT, a California resident at top bracket pays 37.1% on long-term capital gains versus 23.8% in a no-CGT state — a 13.3 percentage point gap on every dollar of gain.

The Net Investment Income Tax is a 3.8% Medicare-funded surtax on investment income (capital gains, dividends, interest, rental income, royalties, passive business income) for high earners. It applies when modified adjusted gross income (MAGI) exceeds $200,000 for single filers or $250,000 for married filing jointly. NIIT is calculated on the lesser of (a) total net investment income or (b) the amount of MAGI exceeding the threshold. The 3.8% rate stacks on top of regular capital gains rates — making federal LTCG 23.8% at top bracket (vs the headline 20%) and short-term gains up to 40.8% (vs 37%). NIIT was created by the Affordable Care Act in 2013 and applies uniformly nationwide; it is a federal tax not subject to state variation. Most state CGT calculators omit NIIT entirely — make sure yours includes it.

Nine states offer some form of preferential long-term capital gains treatment beyond just ordinary income rates. Arkansas (50% LTCG exclusion — effective ~2.93% on long-term gains versus 3.9% ordinary). Hawaii (alternative 7.25% LTCG cap, versus 11% ordinary). Montana (3.0% LTCG cap versus 5.9% ordinary). New Mexico (40% LTCG deduction, effective ~3.54% on long-term gains versus 5.9% ordinary). North Dakota (40% LTCG deduction, effective ~1.25%). Oklahoma (100% exclusion on gains from Oklahoma-based property held 5+ years — effective 0% on qualifying gains). South Carolina (44% LTCG deduction, effective ~3.47% versus 6.2% ordinary). Vermont (40% exclusion or alternative $5,000 flat exclusion, whichever is greater). Wisconsin (30% LTCG exclusion, effective ~5.36% versus 7.65% ordinary). These exclusions require holding-period verification and sometimes asset-type qualification — consult your state's Department of Revenue for specifics.

Maybe — but the math has to be large enough to justify the friction. The savings from moving from California (13.3%) to Florida (0%) on a $1M long-term gain = $133,000 of pure tax savings. On a $10M business exit, the savings = $1.33 million. At those scales, relocation pays for itself many times over. But moves under $500K total gain rarely justify the disruption (closing one chapter of life, establishing new residency, severing aggressive home-state audit risk). Critical: the high-tax states (CA, NY, NJ, MA) run aggressive residency audits. Moving a driver's license isn't enough — you need genuine domicile change: home sale (or genuine secondary status of old home), voter registration, primary care physician, social ties, gym, religious community, 183+ days physically present, plus documentation of all of the above. CA in particular will pursue former residents for years after a move. Establish residency at least 12-18 months before a major sale, and document everything contemporaneously.

Massachusetts imposes a flat 5% income tax on most income including capital gains. On top of that, Massachusetts voters approved in November 2022 (Article CXXI of the Massachusetts Constitution) a 4% surtax on household income above $1 million, effective January 1, 2023. The surtax stacks: income up to $1M is taxed at 5%, income above $1M is taxed at 9%. For capital gains specifically, this creates a steep step-up: a Massachusetts resident with $800K of long-term capital gains and $300K of ordinary income hits the $1M surtax threshold at $100K of gain — meaning the top $100K of that $800K gain is taxed at 9% state plus 23.8% federal = 32.8% effective. Massachusetts also taxes short-term gains at 8.5% (a separate, higher rate than LTCG). The Tax Equity and Fiscal Responsibility Coalition and other groups have not successfully challenged the surtax in court as of May 2026.

Federally, gains on the sale of a primary residence are excluded from taxable income up to $250,000 for single filers and $500,000 for married filing jointly under IRC Section 121. You must have owned and lived in the home as your principal residence for at least 2 of the last 5 years before sale. Gains above these exclusions are taxable at long-term capital gains rates (assuming you've owned 1+ years). Most states follow the federal exclusion automatically — including high-CGT states like California and New York. Washington's tiered capital gains tax explicitly exempts primary residences. For a married couple selling a long-held home with $700K of gain, the first $500K is tax-free; the remaining $200K is taxed at long-term capital gains rates federally plus state rates wherever applicable. This is a powerful incentive that survives at every state's level — even CA at 13.3% still respects the federal exclusion.

Short-term capital gains apply to assets held 1 year or less and are taxed federally at ordinary income rates (10-37% for 2026). Long-term capital gains apply to assets held more than 1 year (1 year and 1 day minimum) and receive preferential federal rates of 0%, 15%, or 20%. At the top brackets, the difference is dramatic: short-term tops at 37% federal + 3.8% NIIT = 40.8% versus long-term at 20% + 3.8% = 23.8% — a 17 percentage point gap, before state taxes. State treatment varies: most states tax short and long-term identically (as ordinary income), but a handful provide LTCG exclusions only for long-term holdings. Massachusetts uniquely charges a higher 8.5% rate on short-term gains versus 5% on long-term. The 'one year and one day' rule is enforced strictly — sales on day 365 from purchase are short-term, sales on day 366 are long-term. Document acquisition dates carefully, especially for stock split or DRIP-acquired lots.

Section 1202 Qualified Small Business Stock (QSBS) is a federal tax provision that allows up to $10 million (or 10x your basis, whichever is greater) of gain to be excluded from federal capital gains tax — entirely tax-free at the federal level. To qualify: (1) stock must be in a domestic C-corporation, (2) the company must have less than $50 million in gross assets at the time of stock issuance, (3) you must have acquired the stock at original issuance (not on secondary market), (4) you must hold the stock for at least 5 years, and (5) the business must be in a qualifying industry (most are; financial services, hospitality, professional services, and farming are excluded). State conformity varies dramatically: New York and Illinois fully conform (state exclusion follows federal). California conforms only for stock in California businesses (limited). New Jersey and Pennsylvania do not conform at all (state tax applies even though federal is excluded). Massachusetts conforms with limits. For founders, early employees, and angel investors in startups, QSBS is the most powerful tax planning tool in US code — a $10M gain saves $2-3M+ in federal tax. Document acquisition dates and company-level qualification status meticulously.

Federally, yes. The IRS classifies virtual currency (Bitcoin, Ethereum, all cryptocurrencies) as property (Notice 2014-21), so gains are taxed under standard capital gains rules — short-term if held 1 year or less, long-term if held longer. The same 0%/15%/20% federal LTCG brackets and 3.8% NIIT apply. State treatment also typically follows federal — crypto gains in California are taxed at 13.3%, in Florida at 0%, and so on. Three crypto-specific wrinkles: (1) crypto-to-crypto trades are taxable events (trading ETH for BTC realizes a gain on the ETH); (2) crypto sales must be reported on Form 8949 just like stock sales — the IRS receives 1099-DA forms from major exchanges starting in 2026 tax year per the Infrastructure Investment and Jobs Act; (3) cryptocurrency staking rewards and mining income are taxed as ordinary income (not capital gains) at the fair market value at receipt, then later sale of those tokens generates a separate capital gain/loss on the appreciation. NFTs are taxed as collectibles federally — 28% LTCG rate rather than 20%.

All federal rates reflect IRS Revenue Procedure 2025-32 (the 2026 inflation-adjusted figures, released October 2025). NIIT thresholds are statutory (not indexed) and remain $200K single / $250K MFJ. State capital gains rates reflect statutes in effect as of May 2026 with citations to each state's Department of Revenue. Washington's tiered capital gains structure reflects SB 5813 (signed May 2025, retroactive to January 1, 2025) and the new ESSB 6346 millionaires income tax (effective January 1, 2028). Massachusetts's surtax reflects the November 2022 constitutional amendment in continuing effect. State LTCG preferential treatments (Arkansas, Hawaii, Montana, New Mexico, North Dakota, Oklahoma, South Carolina, Vermont, Wisconsin) reflect each state's current statutes. For your specific situation, click through to the per-state guide pages or consult a CPA before a major sale. State capital gains rules can change mid-year via legislation — verify current law at your state's Department of Revenue immediately before a large transaction.