Personal Finance

Here's how to leverage higher income limits for the 0% capital gains bracket


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The earnings limit for the 0% capital gains bracket will rise in 2025, which could offer tax planning opportunities, financial experts say.

At sale, profitable assets owned for more than one year qualify for lower taxes — known as long-term capital gains. Those rates are 0%, 15% or 20%, depending on taxable income.   

The IRS this week unveiled inflation adjustments for 2025, including higher taxable income limits for the 0% capital gains bracket.

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Starting in 2025, single filers qualify for the 0% long-term capital gains rate with taxable income of $48,350 or less, while married couples filing jointly are eligible with $96,700 or less.

You could qualify for the 0% bracket with higher earnings than you expect. The taxable income formula subtracts the greater of the standard or itemized deductions from your adjusted gross income.

Here’s what investors need to know about planning around the 0% capital gains bracket, according to financial experts.

Weigh ‘tax gain harvesting’

If you’re sitting on profitable investments, the 0% capital gains bracket could offer a chance for “tax gain harvesting,” said certified financial planner Ashton Lawrence, a director at Mariner Wealth Advisors in Greenville, South Carolina.

Here’s how it works: Investors in the 0% capital gains bracket can strategically sell profitable brokerage account assets without triggering capital gains taxes.

You can then repurchase the same assets to “reset your cost basis,” or original purchase price, to save on future taxes, Lawrence said.

Opt for tax-free rebalancing

‘Project your entire tax situation’



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