Capital Gains Tax by State 2026: 30 States Give No Break

Updated October 9, 2026. Quick answer: 30 states tax a long-term capital gain as ordinary income — no break at all — and only 12 give it preferential treatment. The combined column below is ours, computed rather than copied: the federal top long-term rate of 20%, plus the 3.8% net investment income tax that sits on top of it, plus your state’s own top rate. And the row every published table gets wrong is Washington: it has no income tax and still taxes long-term gains, through a separate excise.

Read box by box from the IRS form text: Form 1099-DA box 1f and Form 1099-DA box 6.

More IRS forms and schedules, read line by line: Form 8997 instructions.

State by state, whether the state taxes the profit from selling your home: state tax on home sale profit.

Whether your state taxes the dividends and interest is answered state by state: state tax on dividends and interest, by state.

Whether each state taxes military retired pay is answered state by state: military retirement pay by state.

State by state, the pages that answer whether a state taxes capital gains: does Arkansas tax capital gains, does Delaware tax capital gains, does District of Columbia tax capital gains, does Hawaii tax capital gains, does Idaho tax capital gains, does Iowa tax capital gains, does Kansas tax capital gains, does Maine tax capital gains, does Mississippi tax capital gains, does Montana tax capital gains, does Nebraska tax capital gains, does New Mexico tax capital gains, does North Dakota tax capital gains, does Oklahoma tax capital gains, does Rhode Island tax capital gains, does Vermont tax capital gains and does West Virginia tax capital gains.

State by state, the pages that answer whether a state taxes capital gains: does Wisconsin tax capital gains, does Colorado tax capital gains, does Maryland tax capital gains, does Connecticut tax capital gains, does Oregon tax capital gains, does South Carolina tax capital gains, does Kentucky tax capital gains, does Alabama tax capital gains, does Louisiana tax capital gains, does Indiana tax capital gains, does Missouri tax capital gains, does Utah tax capital gains, does Nevada tax capital gains, does South Dakota tax capital gains, does Wyoming tax capital gains, does New Hampshire tax capital gains and does Alaska tax capital gains.

State by state, the pages that answer whether a state taxes capital gains: does Florida tax capital gains, does Texas tax capital gains, does Tennessee tax capital gains, does Washington tax capital gains, does Pennsylvania tax capital gains, does Illinois tax capital gains, does California tax capital gains, does New York tax capital gains, does New Jersey tax capital gains, does Massachusetts tax capital gains, does Arizona tax capital gains, does North Carolina tax capital gains, does Georgia tax capital gains, does Virginia tax capital gains, does Ohio tax capital gains, does Michigan tax capital gains and does Minnesota tax capital gains.

Price a sale against the 2026 capital gains rates: capital gains tax calculator.

The IRS form or worksheet behind this, read line by line: Form 8960 instructions.

Related guides on this topic: Does Vermont Tax Social Security? (2026), Hawaii Estate Tax (2026) and Hawaii Retirement Taxes (2026).

Three treatments, not two

• Taxed as ordinary income (30). The largest group by far. California is explicit: its Franchise Tax Board states flatly that “California does not have a lower rate for capital gains. All capital gains are taxed as ordinary income.”
• Preferential treatment (12). An exclusion, a deduction or a lower rate.
• No individual income tax (8). And this is where the trap lives.

Washington: no income tax, and it still taxes the gain

Every “states with no income tax” table gets this wrong. Washington has no individual income tax, so it appears in the no-tax column everywhere — and it levies a separate excise tax on long-term capital gains, tiered from tax year 2025 at 7% on the first $1,000,000 of taxable Washington capital gains and 9.9% above that, under RCW ch. 82.87. It is not an income tax, which is exactly why the income-tax tables miss it, and it is still tax on your gain.

Two more rows worth getting right

California’s 13.3% is a sum, not a bracket. The top marginal rate is 12.30%; the widely quoted 13.3% adds the 1% Behavioral Health Services Tax, which applies only above $1,000,000 of income. Below that, quoting 13.3% overstates the rate.

New Hampshire is two errors deep in most tables. Its interest-and-dividends tax was repealed in its entirety effective 1 January 2025 — and even before repeal it reached interest and dividends only, so capital gains were never in its base. A table carrying a New Hampshire capital-gains rate is wrong twice over.

The combined column, and exactly how it is built

Combined top rate = 20% federal + 3.8% NIIT + your state’s top rate. It is the top of the scale, not what a typical seller pays — the federal rate is 0% or 15% below the top thresholds, and the NIIT only applies above its own income thresholds. Which of the three federal rates you land in is set by your taxable income against the ordinary brackets, and those thresholds are re-indexed annually: the 2027 schedule and its announcement date.

The tax years do not all match, and we are not hiding that.

• The federal 20% is a tax-year-2025 figure. The 20% top rate is statutory and applies for 2026 as well. IRS Topic 409 still listed only tax-year-2025 thresholds when we re-read it on 30 September 2026, while Rev. Proc. 2025-32 sets the 2026 thresholds; we are labelling the year rather than rolling it forward.
• The 3.8% NIIT carries forward safely because its thresholds are statutory: the IRS states that “these threshold amounts are not indexed for inflation.”
• Each state’s component carries its own tax year, shown in the table. They are not all the same year, so a combined figure is a stack of components rather than a single-year rate.

7 rows are marked “not computed” rather than given a number we would have had to invent — where the state rate is not expressible as a single percentage, or where there is no individual income tax on the gain to add. Washington is deliberately among them: its excise does not belong in an income-tax stack, and forcing it in would produce a figure that is arithmetically tidy and conceptually wrong.

The table: all 51 jurisdictions

What this table does not price. It gives the rate a state applies to a long-term gain, and nothing about the gain itself — and on the two sales most households actually make, the gain is decided before the state column is ever reached. On a home it is the Section 121 exclusion that decides it: the exclusion is applied to the gain before any rate is, and the compound cases sit around it — downsizing in retirement, a house taken with a stepped-up basis, and depreciation taken while it was a rental, which comes out first and at the separate 25% unrecaptured section 1250 rate noted below rather than at 20%. The second thing this table does not price is residency: the state column applies to the state that taxes you when the sale closes, so a move and a sale in the same year have an order. And a state’s treatment of a gain is one layer of several that change with a move — how the same state treats retirement income and whether it taxes the estate at death are separate tables with different answers.

Figures verified against IRS Topic 409, the IRS net investment income tax pages, IRS Rev. Proc. 2025-32 and the state statutes and agency pages read on September 30, 2026; the state rows for Colorado, Utah, New Mexico, Arkansas, Oklahoma, Alaska, Nevada, Texas and Wyoming, the California 1% Behavioral Health Services Tax, and any 2026 rate changes in Georgia were not re-checked

Sources and limits

State rows are the states’ own statutes and revenue-department sources, each carrying its citation, source type and retrieval date. The federal components are the IRS’s: Topic 409 for the long-term rates and the net investment income tax, both read 2026-08-07.

What this is not: state rates here are top marginal rates unless the row says flat, so most sellers pay less. Local and city income taxes are not included. The federal figures omit the special maximum rates — 25% on unrecaptured section 1250 gain and 28% on collectibles and qualified small business stock — which change the answer for property and collectibles sales. Residency, part-year residency and where the asset sits all move the result. General information, not tax advice.

Free to reuse under CC BY 4.0 with a link. The combined column is our computation — please cite it as such rather than to the IRS or to a state.

Suggested citation: “Capital gains tax by state,” Clear Money Guide, 2026, clearmoneyguide.com/capital-gains-tax-by-state/.