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Are Long-Term Capital Gains Taxable?

Long-Term Capital Gains Can Become Taxable in Certain Situations

On a standalone basis, the first $80,800 (2021) of long-term capital gains for a couple who are married and filing jointly (MFJ) is not taxable provided the couple does not have other income.  Obviously, that is rarely the case, and it is, therefore, important to keep in mind that capital gains tax brackets are significantly different from those of ordinary income.     

For a married couple filing jointly (MFJ) in 2021, the thresholds for capital gains taxation are outlined below:    

 

 

The table listed above can be found in Tax Clarity by clicking "Brackets & Thresholds" in the "Settings" section of the "Input Data" slide out. One can clearly see the bracket and threshold differences between ordinary income and capital gains, along with tables for exemptions and the possible Medicare impact.