Capital gains tax applies when you sell an asset for more than you paid. The rate depends on how long you held it and your income.
Short-term capital gains (held < 1 year) are taxed as ordinary income — up to 37%.
Long-term capital gains (held ≥ 1 year) are taxed at 0%, 15%, or 20% depending on your income bracket.
The Net Investment Income Tax (NIIT) adds an additional 3.8% for high earners above $200K (single) or $250K (married).
0% for incomes up to $47,025 (single), 15% up to $518,900, and 20% above that (2024).
Yes. Crypto is treated as property by the IRS. Selling at a profit triggers capital gains tax.