Updated October 4, 2026. Quick answer: Yes. “California taxes long and short term capital gains as regular income”, and “No special rate for long term capital gains exists”. For 2025 the single-filer schedule runs from 1.00% to 12.30%.
Selling your home? How the state taxes the profit, from its own tax documents: Does California tax the profit from selling your home?.
The same question for dividends and interest: does California tax dividends and interest.
How California treats capital gains
| Item | What the documents say |
|---|---|
| Treatment | Taxed as regular income; no special rate for long-term gains |
| Short-term and long-term gains | Taxed the same |
| 2025 rates (single, Schedule X) | 1.00%, 2.00%, 4.00%, 6.00%, 8.00%, 9.30%, 10.30%, 11.30% and 12.30%; the 9.30% bracket begins above 72,724 and the 12.30% bracket above 742,953 |
| Taxable income over $1,000,000 | The booklet’s line 62 adds the Behavioral Health Services Tax when taxable income is more than $1,000,000 |
A $50,000 long-term gain
The tax on a $50,000 gain depends on the bracket it lands in. Taxed wholly at 1.00% it would add $500; taxed wholly at 12.30% it would add $6,150.
A single filer whose 2025 taxable income is already above 72,724 pays 9.30% or more on the whole gain, computed as $50,000 x 9.30% = $4,650 at least.
What changes in 2026
The 2025 booklet is the latest California document read, and it prints no 2026 rate schedule.
Federal rules
The state’s treatment sits on top of the federal one. The IRS explains the federal tax on gains in Topic no. 409, Capital Gains and Losses and Publication 550, Investment Income and Expenses.
Related: whether California taxes pensions, how California taxes retirement income, the capital gains tax by state table, and the federal capital gains tax calculator.
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Answer againSources
- 2025 California 540 Forms & Instructions Personal Income Tax Booklet: https://www.ftb.ca.gov/forms/2025/2025-540-booklet.html
Sources: the primary documents linked above, read on October 4, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.