Capital Gains Tax Calculator 2017 Usa

Use this calculator to determine your capital gains tax liability for the 2017 tax year in the USA. The calculator accounts for both long-term and short-term capital gains, your ordinary income, and the 2017 tax brackets.

How Capital Gains Tax Works in 2017 USA

Capital gains tax applies to the profit you make from selling an asset (like stocks, real estate, or cryptocurrency) that has increased in value. In the USA, capital gains are divided into two categories: long-term and short-term.

Key Formula

Capital Gains Tax = (Capital Gain × Tax Rate) - (Capital Loss × Tax Rate)

Where:

Capital Gain = Sale Price - Cost Basis
Tax Rate = Depends on your ordinary income and the type of capital gain
Capital Loss = Cost Basis - Sale Price (if applicable)

The IRS uses your total ordinary income to determine the appropriate tax bracket for your capital gains. This is called the "bracket creep" rule.

Long-Term vs Short-Term Capital Gains

The IRS distinguishes between long-term and short-term capital gains based on how long you held the asset:

Type	Holding Period	Tax Treatment
Long-Term	More than 1 year	Taxed at your ordinary income tax rate
Short-Term	1 year or less	Taxed as ordinary income

In 2017, the IRS introduced a new rule that treats certain assets held for more than 5 years as long-term capital gains, regardless of the actual holding period. This applies to collectibles, small business stock, and certain other assets.

2017 Capital Gains Tax Rates

The tax rate for capital gains depends on your total ordinary income for the year. Here are the 2017 tax brackets:

Ordinary Income	Capital Gains Tax Rate
$0 - $38,600	0%
$38,601 - $82,500	15%
$82,501 - $157,500	23.8%
$157,501 - $200,000	28%
$200,001 - $500,000	33%
$500,001+	35%

For long-term capital gains, the rates are the same as your ordinary income tax rates. Short-term capital gains are always taxed at ordinary income rates.

Wash Sale Rule

The wash sale rule prevents taxpayers from claiming capital losses on the sale of an asset if they buy substantially identical stock or property within 30 days before or after the sale.

If you sell an asset at a loss and buy a similar asset within 30 days, you cannot deduct that loss. Instead, you must treat the loss as a short-term capital gain.

This rule applies to stocks, bonds, and other securities. It does not apply to real estate or other property.

Worked Examples

Example 1: Long-Term Capital Gain

You bought a stock in 2013 for $10,000 and sold it in 2017 for $15,000. Your total ordinary income for 2017 was $75,000.

Calculation:

Capital Gain = $15,000 - $10,000 = $5,000
Tax Rate = 23.8% (since $75,000 falls in the $82,501-$157,500 bracket)
Capital Gains Tax = $5,000 × 23.8% = $1,190

Example 2: Short-Term Capital Loss

You bought a stock in 2017 for $5,000 and sold it in 2017 for $4,000. Your total ordinary income was $40,000.

Calculation:

Capital Loss = $5,000 - $4,000 = $1,000
Tax Rate = 0% (since $40,000 falls in the $0-$38,600 bracket)
Capital Gains Tax = $1,000 × 0% = $0

Frequently Asked Questions

What is the difference between capital gains and ordinary income?

Ordinary income includes wages, salaries, and business profits. Capital gains come from selling assets that have increased in value. The IRS treats them differently for tax purposes.

How do I calculate my cost basis?

Your cost basis is the total amount you paid to acquire the asset, including purchase price, commissions, and other fees. For depreciable assets, you may need to use the adjusted basis.

Can I deduct capital losses?

Yes, you can deduct capital losses against capital gains and ordinary income. However, net capital losses can only be carried forward for 3 years.

What happens if I sell an asset for a loss?

If you sell an asset for a loss, you can deduct that loss from your taxable income. However, you cannot deduct the loss if you buy a substantially identical asset within 30 days (wash sale rule).