Federal (IRC)

Federal long-term capital gains taxed at 0%, 15%, or 20% depending on taxable income

“The tax rate on most net capital gain is no higher than 15% for most individuals. Some or all net capital gain may be taxed at 0% if your taxable income is less than or equal to the threshold for the 0% rate. A capital gains rate of 20% applies to capital gain if your taxable income is more than the threshold set for the 15% capital gain rate.”

Note: TY2025 MFJ/QSS breakpoints (Rev. Proc. 2024-40): 0% up to $96,700; 15% $96,701-$600,050; 20% above $600,050. Single: 0% to $48,350; 15% to $533,400; 20% above. HOH: 0% to $64,750; 15% to $566,700; 20% above.

Net Investment Income Tax: 3.8% on net investment income above MAGI threshold

“The NIIT is 3.8% of the amount of net investment income that exceeds the applicable threshold amount. Net investment income generally includes interest, dividends, annuities, royalties, rents, and net capital gains from property held for investment.”

Note: TY2025 MAGI thresholds (statutory, NOT inflation-adjusted): $250,000 MFJ/QSS; $200,000 Single/HOH; $125,000 MFS. NIIT stacks on top of the 20% LTCG rate for a combined federal top rate of 23.8% on long-term capital gains.

Net Investment Income Tax: 3.8% on net investment income above MAGI threshold

“The NIIT is 3.8% of the amount of net investment income that exceeds the applicable threshold amount. Net investment income generally includes interest, dividends, annuities, royalties, rents, and net capital gains from property held for investment.”

Note: TY2025 MAGI thresholds (statutory, NOT inflation-adjusted): $250,000 MFJ/QSS; $200,000 Single/HOH; $125,000 MFS. NIIT stacks on top of the 20% LTCG rate for a combined federal top rate of 23.8% on long-term capital gains.

Capital losses deductible against ordinary income up to $3,000 per year ($1,500 MFS)

“If your capital losses exceed your capital gains, the amount of the excess loss that you can claim to lower your income is the lesser of $3,000 ($1,500 if married filing separately) or your total net loss shown on Schedule D (Form 1040).”

Federal capital losses exceeding the $3,000 annual limit carry forward indefinitely

“Any excess net capital loss can be carried over to subsequent years to be deducted against capital gains and against up to $3,000 of other kinds of income per year until all of the excess net capital loss is used up.”

Note: Character is preserved on carryforward: long-term losses remain long-term; short-term remain short-term.

Interest on state and local bonds is excluded from federal gross income

“Except as provided in subsection (b), gross income does not include interest on any State or local bond.”

Note: State treatment varies: most states exempt in-state bonds and tax out-of-state bonds (Dep't of Revenue of Ky. v. Davis, 553 U.S. 328 (2008) permits such discrimination). See per-state muni-instate / muni-outstate facts.

Interest on state and local bonds is excluded from federal gross income

“Except as provided in subsection (b), gross income does not include interest on any State or local bond.”

Note: State treatment varies: most states exempt in-state bonds and tax out-of-state bonds (Dep't of Revenue of Ky. v. Davis, 553 U.S. 328 (2008) permits such discrimination). See per-state muni-instate / muni-outstate facts.

Interest on US Treasury obligations is exempt from all state and local income taxes

“Stocks and obligations of the United States Government are exempt from taxation by a State or political subdivision of a State. The exemption applies to each form of taxation that would require the obligation, the interest on the obligation, or both, to be considered in computing a tax.”

Note: Federal law preempts all state attempts to tax US Treasury interest. This includes T-bills, T-notes, T-bonds, TIPS, and I-bonds. Money market funds with 100% Treasury holdings qualify; blended funds may not. Most states allow a deduction or exclusion by reference to this statute.

Qualified dividends taxed at 0%/15%/20% LTCG rates (same thresholds as LTCG)

“For purposes of this subsection, the term 'net capital gain' means net capital gain (determined without regard to this paragraph) increased by qualified dividend income.”

Note: IRC §1(h)(11)(C) treats qualified dividends as net capital gain taxed at preferential 0%/15%/20% rates. Qualified dividends are those meeting IRC §1(h)(11)(B) holding period and issuer requirements. They stack with LTCG: combined (QD + LTCG) determines which 0%/15%/20% bracket applies per IRC §1(h)(1) thresholds.

Federal estate tax rate schedule: 40% on taxable estate above $1,000,000 over the applicable exclusion

“If the amount with respect to which the tentative tax to be computed is over $1,000,000, the tentative tax shall be $345,800 plus 40 percent of the excess of such amount over $1,000,000.”

Note: The 40% top rate applies to amounts over $1,000,000 above the applicable exclusion. Combined with the inflation-adjusted basic exclusion (IRC §2010(c)(3)), the effective entry point for federal estate tax is the exclusion amount, not $1,000,000.

TY2024 federal basic exclusion amount: $13,610,000 per IRC §2010(c)(3), inflation-adjusted

“For an estate of any decedent dying in calendar year 2024, the basic exclusion amount is $13,610,000 for determining the amount of the unified credit against estate tax under § 2010.”

Note: Up from $12,920,000 in TY2023. The TCJA doubled the pre-2018 exemption, CPI-adjusted annually.

TY2025 federal basic exclusion amount: $13,990,000 per IRC §2010(c)(3), inflation-adjusted

“For an estate of any decedent dying in calendar year 2025, the basic exclusion amount is $13,990,000 for determining the amount of the unified credit against estate tax under § 2010.”

Note: Up from $13,610,000 in TY2024 (Rev. Proc. 2023-34). Portability allows a surviving spouse to use the deceased spouse's unused exclusion (DSUE), effectively doubling to $27,980,000 for a married couple. OBBBA (2025) set a new permanent $15,000,000 base for 2026+.

TY2026 federal basic exclusion amount: $15,000,000 per IRC §2010(c)(3) as amended by OBBBA

“Section 70106 of the OBBBA amends § 2010(c)(3) by increasing the basic exclusion amount to $15,000,000 for calendar year 2026.”

Note: The One Big Beautiful Bill Act set a new permanent $15,000,000 base exclusion for decedents dying in 2026 (inflation-indexed thereafter), replacing the scheduled TCJA sunset. Portability doubles this to $30,000,000 for a married couple. Confidence medium: IRS inflation release.

Federal QOZ: IRC §1400Z-2 gain deferral and exclusion for investments in qualified opportunity funds

“In the case of gain from the sale to, or exchange with, an eligible taxpayer of any property, at the election of the taxpayer, gross income for the taxable year shall not include so much of such gain as does not exceed the amount invested by the taxpayer in a qualified opportunity fund during the 180-day period beginning on the date of such sale or exchange.”

Note: IRC §1400Z-2 is the federal QOZ provision. State conformity varies: rolling-conformity states incorporate it automatically; fixed-date states only if their reference date is post-TCJA. See per-state qoz-conformity facts.

Federal QSBS: IRC §1202 excludes 100% of gain on qualifying small business stock acquired after Sept. 27, 2010

“In the case of a taxpayer other than a corporation, gross income shall not include 50 percent (100 percent in the case of qualified small business stock acquired after September 27, 2010) of any gain from the sale or exchange of qualified small business stock.”

Note: The 100% exclusion requires: C-corp issuer; gross assets under $50M at issuance; active trade or business; 5-year holding period. Most states decouple from §1202 due to revenue impact. See per-state qsbs-conformity facts.

IRC §1212(b): capital losses carry forward only for non-corporate taxpayers; no carryback

“In the case of a taxpayer other than a corporation, if there is a net capital loss for any taxable year: (1) the excess of the net short-term capital loss over the net long-term capital gain for such year shall be a short-term capital loss in the succeeding taxable year, and (2) the excess of the net long-term capital loss over the net short-term capital gain for such year shall be a long-term capital loss in the succeeding taxable year.”

Note: IRC §1212(b) limits non-corporate taxpayers to carrying losses forward only ('succeeding taxable year'). IRC §1212(a), which allows a 3-year carryback, applies only to corporations. For conformity states, the federal carryforward amount flows to the state return unchanged.

GSE bond interest (FNMA, FHLMC) is included in federal gross income; no bondholder exemption statute exists

“Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not limited to) the following items: (4) Interest.”

Note: IRC §61(a) defines gross income to include all income from whatever source derived; subsection (a)(4) explicitly includes interest income. FNMA (12 U.S.C. §§1719(e), 1723a(c)) and FHLMC (12 U.S.C. §1455(a)) enabling statutes grant NO bondholder tax exemption from federal tax, unlike FHLB (12 U.S.C. §1433) and FFCB (12 U.S.C. §2023) which mandate state-level exemption. GSE interest is fully includible in federal gross income.

Statutory recovery period of 27.5 years for residential rental property

“In the case of residential rental property, the recovery period is 27.5 years.”

Unrecaptured section 1250 gain is taxed at a maximum 25% rate

“The portion of any unrecaptured section 1250 gain from selling section 1250 real property is taxed at a maximum 25% rate.”

Note: Statutory 25% cap on the unrecaptured §1250 gain portion of long-term real-property gain. Verbatim from IRS Topic 409.

Charitable deduction for appreciated capital-gain property is limited to 30% of AGI

“Limits Based on 30% of AGI: Certain capital gain property contributions to 50% limit organizations.”

Note: Gifts of long-term appreciated capital-gain property to public (50%-limit) charities, deducted at fair market value, are capped at 30% of AGI (IRC §170(b)(1)(C)). Confidence medium: IRS publication.

Unused charitable contribution deduction carries forward 5 years

“You can carry over any contributions you can't deduct in the current year because they exceed the limits based on your AGI. Except for qualified conservation contributions, you may be able to deduct the excess in each of the next 5 years until it is used up, but not beyond that time.”

Note: Excess charitable deduction over the AGI limit carries forward to the 5 succeeding tax years (IRC §170(d)(1); Pub. 526 'Carryovers'). A qualified conservation contribution carries 15 years. Confidence medium: IRS publication.

Hypothetical 2026 estate exclusion had the TCJA doubling sunset (~$7,000,000)

“the dollar amount in effect under clause (i) shall be increased by ... the cost-of-living adjustment.”

Note: COUNTERFACTUAL, not current law. Had TCJA's doubling sunset on 2026-01-01 (it did not: OBBBA made the ~$15M base permanent), the exclusion would have reverted to the pre-TCJA $5,000,000 base (IRC §2010(c)(3)) inflation-indexed to roughly $7,000,000 for 2026. Approximate; for simulateSunset scenario modeling only. Confidence low: projected counterfactual with no enacted figure.

Corporate §291 ordinary add-back on section 1250 gain is 20%

“20 percent of the excess (if any) of (A) the amount which would be treated as ordinary income if such property was section 1245 property, over (B) the amount treated as ordinary income under section 1250.”

Note: Applies only to C corporations; individuals are not subject to the §291 add-back. The 20% is of the otherwise-capital §1250 portion.

QSBS pre-OBBBA: $10,000,000 per-issuer cap, $50,000,000 gross-assets test, 5-year holding

“$10,000,000 reduced by the aggregate amount of eligible gain taken into account”

Note: For QSBS acquired on or before July 4, 2025: per-issuer exclusion cap is the greater of $10M or 10x basis; issuer aggregate gross assets must not exceed $50M; 5-year holding for the (post-9/27/2010) 100% exclusion.

QSBS pre-OBBBA: $10,000,000 per-issuer cap, $50,000,000 gross-assets test, 5-year holding

“$10,000,000 reduced by the aggregate amount of eligible gain taken into account”

Note: For QSBS acquired on or before July 4, 2025: per-issuer exclusion cap is the greater of $10M or 10x basis; issuer aggregate gross assets must not exceed $50M; 5-year holding for the (post-9/27/2010) 100% exclusion.

QSBS post-OBBBA: $15,000,000 per-issuer cap, $75,000,000 gross-assets, tiered 50/75/100% at 3/4/5 years

“the aggregate amount of excluded gain per issuer goes up to $15 million”

Note: For QSBS acquired after July 4, 2025: per-issuer cap raised to the greater of $15M or 10x basis; issuer gross-assets ceiling raised to $75M; new tiered exclusion 50% (3yr) / 75% (4yr) / 100% (5yr). Confidence medium: IRS guidance page.

QSBS pre-OBBBA: $10,000,000 per-issuer cap, $50,000,000 gross-assets test, 5-year holding

“$10,000,000 reduced by the aggregate amount of eligible gain taken into account”

Note: For QSBS acquired on or before July 4, 2025: per-issuer exclusion cap is the greater of $10M or 10x basis; issuer aggregate gross assets must not exceed $50M; 5-year holding for the (post-9/27/2010) 100% exclusion.

QSBS post-OBBBA: $15,000,000 per-issuer cap, $75,000,000 gross-assets, tiered 50/75/100% at 3/4/5 years

“the aggregate amount of excluded gain per issuer goes up to $15 million”

Note: For QSBS acquired after July 4, 2025: per-issuer cap raised to the greater of $15M or 10x basis; issuer gross-assets ceiling raised to $75M; new tiered exclusion 50% (3yr) / 75% (4yr) / 100% (5yr). Confidence medium: IRS guidance page.

Federal corporate income tax rate is a flat 21%

“The amount of the tax imposed by subsection (a) shall be 21 percent of taxable income.”

Note: Flat 21% on C-corporation taxable income (TCJA, made permanent). Used for the entity-level tax on C-corp asset/stock sales (double-tax modeling).

Federal basic standard deduction: $15,750 single / $31,500 MFJ for taxable years beginning after December 31, 2024

“For purposes of paragraph (1), the basic standard deduction is (A) 200 percent of the dollar amount in effect under subparagraph (C) for the taxable year in the case of (i) a joint return, or (ii) a surviving spouse (as defined in section 2(a)), (B) $4,400 in the case of a head of household (as defined in section 2(b)), or (C) $3,000 in any other case.”

Note: Section 63(c)(7)(A) (Pub. L. 119-21 §70102) substitutes $23,625 for the $4,400 head-of-household amount and $15,750 for the $3,000 other-case amount for taxable years beginning after December 31, 2024, CPI-indexed thereafter with a 2024 base year; the joint amount is 200 percent of $15,750 = $31,500. Verified against uscode.house.gov on 2026-07-02.

Federal basic standard deduction: $15,750 single / $31,500 MFJ for taxable years beginning after December 31, 2024

“For purposes of paragraph (1), the basic standard deduction is (A) 200 percent of the dollar amount in effect under subparagraph (C) for the taxable year in the case of (i) a joint return, or (ii) a surviving spouse (as defined in section 2(a)), (B) $4,400 in the case of a head of household (as defined in section 2(b)), or (C) $3,000 in any other case.”

Note: Section 63(c)(7)(A) (Pub. L. 119-21 §70102) substitutes $23,625 for the $4,400 head-of-household amount and $15,750 for the $3,000 other-case amount for taxable years beginning after December 31, 2024, CPI-indexed thereafter with a 2024 base year; the joint amount is 200 percent of $15,750 = $31,500. Verified against uscode.house.gov on 2026-07-02.

TY2026 standard deduction: $32,200 MFJ, $16,100 single, $24,150 head of household

“For taxable years beginning in 2026, the standard deduction amounts under § 63(c)(2) are as follows: Married Individuals Filing Joint Returns and Surviving Spouses (§ 1(j)(2)(A)) $32,200; Heads of Households (§ 1(j)(2)(B)) $24,150; Unmarried Individuals (other than Surviving Spouses and Heads of Households) (§ 1(j)(2)(C)) $16,100; Married Individuals Filing Separate Returns (§ 1(j)(2)(D)) $16,100.”

Note: The §4.14(1) table is flattened to prose with semicolons; amounts verbatim from the PDF, fetched and extracted 2026-07-02. Announced in IR-2025-103 (2025-10-09).

TY2026 standard deduction: $32,200 MFJ, $16,100 single, $24,150 head of household

“For taxable years beginning in 2026, the standard deduction amounts under § 63(c)(2) are as follows: Married Individuals Filing Joint Returns and Surviving Spouses (§ 1(j)(2)(A)) $32,200; Heads of Households (§ 1(j)(2)(B)) $24,150; Unmarried Individuals (other than Surviving Spouses and Heads of Households) (§ 1(j)(2)(C)) $16,100; Married Individuals Filing Separate Returns (§ 1(j)(2)(D)) $16,100.”

Note: The §4.14(1) table is flattened to prose with semicolons; amounts verbatim from the PDF, fetched and extracted 2026-07-02. Announced in IR-2025-103 (2025-10-09).

Gift tax annual exclusion is $19,000 per donee for calendar year 2025

“For calendar year 2025, the first $19,000 of gifts to any person (other than gifts of future interests in property) are not included in the total amount of taxable gifts under § 2503 made during that year.”

Note: Verbatim from the PDF, fetched 2026-07-02. The non-citizen-spouse exclusion is $190,000 for 2025 (same section). The lifetime exemption is the unified basic exclusion amount carried on the estate-exemption facts ($13,990,000 for 2025).

Gift tax annual exclusion stays $19,000 per donee for calendar year 2026

“For calendar year 2026, the first $19,000 of gifts to any person (other than gifts of future interests in property) are not included in the total amount of taxable gifts under § 2503 made during that year.”

Note: Verbatim from the PDF, fetched 2026-07-02. The non-citizen-spouse exclusion rises to $194,000 for 2026 (same section). The lifetime exemption is the unified basic exclusion amount carried on the estate-exemption facts ($15,000,000 from 2026).

SALT deduction cap: $40,000 (2025), $40,400 (2026), 101% escalator 2027-2029, $10,000 from 2030; phased down 30% of MAGI over a threshold ($500,000 in 2025, $505,000 in 2026, 101%/yr after) to a $10,000 floor

“the aggregate amount of taxes taken into account under paragraphs (1), (2), and (3) of subsection (a) and paragraph (5) of this subsection for any taxable year shall not exceed the applicable limitation amount (half the applicable limitation amount in the case of a married individual filing a separate return).”

Note: Applicable limitation amount (§164(b)(7)): $40,000 for 2025; $40,400 for 2026; 101 percent of the prior-year amount for 2027-2029; $10,000 for 2030 and after. Reduced by 30 percent of the excess of MAGI over the threshold amount, which escalates on the same schedule: $500,000 for 2025, $505,000 for 2026, then 101 percent of the prior-year threshold (half for MFS); never below $10,000. Verified against uscode.house.gov on 2026-07-03. The cap is why PTET elections exist; see the ptet-* facts.

SALT deduction cap: $40,000 (2025), $40,400 (2026), 101% escalator 2027-2029, $10,000 from 2030; phased down 30% of MAGI over a threshold ($500,000 in 2025, $505,000 in 2026, 101%/yr after) to a $10,000 floor

“the aggregate amount of taxes taken into account under paragraphs (1), (2), and (3) of subsection (a) and paragraph (5) of this subsection for any taxable year shall not exceed the applicable limitation amount (half the applicable limitation amount in the case of a married individual filing a separate return).”

Note: Applicable limitation amount (§164(b)(7)): $40,000 for 2025; $40,400 for 2026; 101 percent of the prior-year amount for 2027-2029; $10,000 for 2030 and after. Reduced by 30 percent of the excess of MAGI over the threshold amount, which escalates on the same schedule: $500,000 for 2025, $505,000 for 2026, then 101 percent of the prior-year threshold (half for MFS); never below $10,000. Verified against uscode.house.gov on 2026-07-03. The cap is why PTET elections exist; see the ptet-* facts.

SALT deduction cap: $40,000 (2025), $40,400 (2026), 101% escalator 2027-2029, $10,000 from 2030; phased down 30% of MAGI over a threshold ($500,000 in 2025, $505,000 in 2026, 101%/yr after) to a $10,000 floor

“the aggregate amount of taxes taken into account under paragraphs (1), (2), and (3) of subsection (a) and paragraph (5) of this subsection for any taxable year shall not exceed the applicable limitation amount (half the applicable limitation amount in the case of a married individual filing a separate return).”

Note: Applicable limitation amount (§164(b)(7)): $40,000 for 2025; $40,400 for 2026; 101 percent of the prior-year amount for 2027-2029; $10,000 for 2030 and after. Reduced by 30 percent of the excess of MAGI over the threshold amount, which escalates on the same schedule: $500,000 for 2025, $505,000 for 2026, then 101 percent of the prior-year threshold (half for MFS); never below $10,000. Verified against uscode.house.gov on 2026-07-03. The cap is why PTET elections exist; see the ptet-* facts.

SALT deduction cap: $40,000 (2025), $40,400 (2026), 101% escalator 2027-2029, $10,000 from 2030; phased down 30% of MAGI over a threshold ($500,000 in 2025, $505,000 in 2026, 101%/yr after) to a $10,000 floor

“the aggregate amount of taxes taken into account under paragraphs (1), (2), and (3) of subsection (a) and paragraph (5) of this subsection for any taxable year shall not exceed the applicable limitation amount (half the applicable limitation amount in the case of a married individual filing a separate return).”

Note: Applicable limitation amount (§164(b)(7)): $40,000 for 2025; $40,400 for 2026; 101 percent of the prior-year amount for 2027-2029; $10,000 for 2030 and after. Reduced by 30 percent of the excess of MAGI over the threshold amount, which escalates on the same schedule: $500,000 for 2025, $505,000 for 2026, then 101 percent of the prior-year threshold (half for MFS); never below $10,000. Verified against uscode.house.gov on 2026-07-03. The cap is why PTET elections exist; see the ptet-* facts.