Capital Gains Tax by State: What You Actually Pay, Combined

Updated August 7, 2026. Quick answer: 29 states tax a long-term capital gain as ordinary income — no break at all — and only 13 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.

Three treatments, not two

• Taxed as ordinary income (29). 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 (13). 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 Its interest-and-dividends tax was repealed in its entirety effective 1 January 2025 — and even before repeal it reached interest and dividends only, so capital gains were never in its base.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.

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

• The federal 20% is a tax-year-2025 figure. The IRS had not published 2026 capital-gains thresholds on Topic 409 when we read it on 7 August 2026, so this is the latest published figure and we are labelling it 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

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/.