Short-Term vs. Long-Term Gains

How long you hold an investment can change your tax rate dramatically. Here are the 2026 long-term capital gains brackets, how short-term gains are taxed and what the difference can mean in dollars. General education, not tax advice.

The one-year line

Investments held one year or less produce short-term gains, taxed at ordinary income rates, which range from 10% to 37%. Investments held more than one year produce long-term gains, taxed at lower rates of 0%, 15% or 20%. The holding period generally starts the day after you buy.

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