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With the stock market hovering near record highs<\/a>, you may have\u00a0large profits sitting in a taxable brokerage<\/a> account.\u00a0<\/p>\n Upon selling, you could owe capital gains taxes<\/a>, levied at 0%, 15% or 20%, based on taxable income, if you own the assets for more than one year. There’s also a 3.8% surcharge<\/a> for higher earners, which could bring the total rate to 23.8%.<\/p>\n But many investors don’t realize they qualify for 0% capital gains<\/a>, which is a chance to take some profits without triggering a tax bill<\/a>.\u00a0<\/p>\n “I’d say probably half of our clients are aware of it and understand the concept,” said certified financial planner Andrew Herzog, associate wealth manager at The Watchman Group in Plano, Texas.<\/p>\n More from Personal Finance:<\/strong> President Donald Trump<\/a>‘s “big beautiful bill”<\/a> didn’t change the capital gains rates. But new deductions could reduce taxable income for 2025, which could expand eligibility for the 0% bracket, experts say.<\/p>\n Here’s what investors need to know about the 0% long-term capital gains brackets for 2025.<\/p>\n<\/div>\n For 2025, you qualify for the 0% long-term capital gains rate if your taxable income is $48,350\u00a0<\/strong>or less for single filers, or $96,700 or less for married couples filing jointly.<\/p>\n But many investors don’t realize there’s a big difference between gross earnings and taxable income. That gap could be even wider under Trump’s new spending package, said Tommy Lucas, a CFP at Moisand Fitzgerald Tamayo in Orlando, Florida.<\/p>\n<\/div>\n You calculate taxable income by subtracting the greater of the standard or itemized deductions from your adjusted gross income<\/a>.<\/p>\n Trump’s legislation increased the standard deduction from $15,000 to $15,750 for single filers and $30,000 to $31,500 for 2025.<\/p>\n For example, if a married couple filing jointly earns $120,000, and you subtract the $31,500 standard deduction, their taxable income is $88,500. That leaves room to harvest gains at 0% before hitting the $96,700 limit.\u00a0<\/p>\n<\/div>\n Trump’s law also added a temporary $6,000 tax break<\/a> ($12,000 for married couples) for older Americans ages 65 and over. The benefit falls once modified adjusted gross income exceeds $75,000 for single filers or $150,000 for married filing jointly.<\/p>\n
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