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What is the Tax Rate for Short Term Capital Gains?

2014 Short Term Capital Gains are taxed as “ordinary” income

As of 2013, individuals earning an income of $450,0001 and over saw an increase in the capital gains tax rate. For this group, long term capital gains tax rate jumped from 15% to 20% while the short term 2013 capital gains tax rates increased by 4.6%.

Check out part one of this article, to learn about long term capital gains. Keep reading for more on short term capital gains and how they relate to filing your taxes. 

2014 Tax Return Coupon

What are short term capital gains?

A Capital gain is a profit made from selling any asset when the sale price exceeds the purchase price.

The capital gains clock begins the day after you acquire the asset until the day you sell it (this includes day you sell it). Depending on how long the capital gain is held for will determine if it falls into the short-term category or long-term.

Continue reading “What is the Tax Rate for Short Term Capital Gains?”

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What is Tax Rate for Long Term Capital Gains?

Long Term Capital Gains are Taxed at a Different Rate Than Short Term Capital Gains

If you earned a profit in 2014 from selling an asset such as stock shares or a house, you’ll need to report it as a long term capital gain on your 2014 tax return.

Long term capital gains are taxed differently than short term gains and other income. In fact, long term capital gains are taxed at a lower rate.

Continue reading “What is Tax Rate for Long Term Capital Gains?”

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What Are the Marginal Tax Rates for California in 2013?

Find out how much money you will owe California when you file state taxes

California is one of the highest taxing states in the country. So it makes sense for Californians to plan ahead and see how much money the state is going to take instead of getting surprised by a big bill next winter.

California’s marginal tax rates for 2013 are as follows. Note that different rates apply to those filing as single and to married couples filing a joint return.

Single Tax Rates

Income Bracket

Tax Rate
$0 – $7,123 1%
$7,124 – $16,889 2%
$16,890 – $26,656 4%
$26,657 – $37,004 6%
$37,005 – $46,765 8%
$46,766 – $999,999 9.3%
$1,000,000+ 10.3%

 

Married Filing Jointly Tax Rates

Income Bracket

Tax Rate
$0 – $14,427 1%
$14,248 – $33,779 2%
$33,780 – $53,313 4%
$53,314 – $74,009 6%
$74,010 – $93,531 8%
$93,532 – $1,999,999 9.3%
$2,000,000+ 10.3%

Like the federal system, each of these rates applies only to your income that falls within that specific bracket. Your top rate does not apply to all of your income.

For example, if you make $40,000, you only have to pay 8% on the $2,995 that falls above that bracket’s $37,005 threshold. You would pay 1% on your first $7,123 of income, 2% on the next $9,765, etc.

California has some of the most complicated state taxes in the nation. Thankfully, when you file with RapidTax, all this math is taken care of for you automatically.

Photo via Mike Behnken on Flickr.