Capital Gains Tax By State 2020

Capital gains tax is a levy assessed on the positive difference between the sale price of an asset and its original purchase price. Assets include shares of stock, a piece of land, jewelry, coin collections, or a business.

Capital gains can be reduced by deducting capital losses that occur when a taxable asset is sold for less than the original purchase price, resulting in “net capital gains.”

There are two types of capital gains tax: short-term and long-term. Short-term capital gains tax is levied on profits from the sale of an asset held for one year or less. The short-term capital gains tax rate equals the individual’s ordinary income tax rate (bracket). Long-term capital gains tax is levied on profits from the sale of an asset held for more than a year. Long-term capital gains tax rate is 0%, 15%, or 20% depending on the individual’s taxable income and filing status. Long-term capital gains tax rates are typically lower than short-term rates.

In addition to paying capital gains tax at the federal levels, a majority of U.S. states also have an additional tax rate between 2.90% and 13.30%.

The states with no additional state tax on capital gains are:

These are the same states that do not tax personal income on wages, although they might tax interest and dividends from investments, depending on the state. These states typically make up for their lack of overall tax income with higher sales and property taxes.

California has the highest capital gains tax rate of 13.30%. California has notoriously high taxes and with up to 39.6% in federal taxes alone, the state taxes can seem especially deep. For higher-income taxpayers, the capital gain rate at the federal level if 20%, plus a 3.8% net investment tax under Obamacare, plus 13.3%.

Hawaii has the second-highest capital gains tax rate of 11.00%, followed by New Jersey with 10.75%, Oregon with 9.90%, and Minnesota with 9.85%.

Below is a table of each state’s capital gains tax rate.

Capital Gains Tax By State 2020

* Values presented in the table are %
State Capital Gains Tax Rate by State 2020 Pop.
Alaska0734,002
Florida021,992,985
Nevada03,139,658
New Hampshire01,371,246
South Dakota0903,027
Tennessee06,897,576
Texas029,472,295
Washington07,797,095
Wyoming0567,025
North Dakota2.9761,723
Pennsylvania3.0712,820,878
Indiana3.236,745,354
Michigan4.2510,045,029
Arizona4.547,378,494
Colorado4.635,845,526
New Mexico4.92,096,640
Illinois4.9512,659,682
Utah4.953,282,115
Alabama54,908,621
Kentucky54,499,692
Mississippi52,989,260
Ohio511,747,694
Oklahoma53,954,821
Massachusetts5.056,976,597
North Carolina5.2510,611,862
Missouri5.46,169,270
Kansas5.72,910,357
Georgia5.7510,736,059
Maryland5.756,083,116
Virginia5.758,626,207
Rhode Island5.991,056,161
Louisiana64,645,184
West Virginia6.51,778,070
Nebraska6.841,952,570
Arkansas6.93,038,999
Montana6.91,086,759
Idaho6.931,826,156
Connecticut6.993,563,077
South Carolina75,210,095
Maine7.151,345,790
Wisconsin7.655,851,754
Iowa8.533,179,849
New York8.8219,440,469
Vermont9.75628,061
Minnesota9.855,700,671
Oregon9.94,301,089
New Jersey10.758,936,574
Hawaii111,412,687
California13.339,937,489