IRS updates 2027 capital-gains tax brackets for inflation

The Internal Revenue Service released its annual inflation-adjusted tax provisions for the 2027 tax year on Nov. 5, 2026. Through Revenue Procedure 2026-35, the agency established new income thresholds for long-term capital-gains tax rates, which remain set at 0%, 15%, and 20%.

These adjustments are calculated using the chained Consumer Price Index to prevent bracket creep, a phenomenon where inflation pushes taxpayers into higher tax brackets despite no change in their real income. The new thresholds apply to income earned between Jan. 1, 2027, and Dec. 31, 2027.

For individuals, the 0% rate applies to taxable income up to $51,050, while the 15% rate applies to income up to $563,200. Married couples filing jointly may qualify for the 0% rate with taxable income up to $102,100, and the 15% rate up to $633,600. Heads of households have a 0% threshold of $68,350 and a 15% threshold of $598,400, while married taxpayers filing separately have thresholds of $51,050 and $316,800, respectively. Taxable income exceeding these 15% brackets is subject to the 20% rate.

Long-term capital-gains rates apply specifically to assets held for more than one year. Assets held for one year or less are generally taxed as ordinary income. Taxpayers are encouraged to review their financial planning and W-4 withholding in preparation for the 2027 tax year.