Do I have to pay short term capital gains tax if I am in the 10% ordinary income tax bracket?

There is no special tax rate for short term capital gains. They are taxed at the same rate as your ordinary income. Ordinary income tax rates range from 10% to 39.6%

If you can hold your hold your assets for more than a year, you will qualify for long term capital gains rate which are 0%,15%,20% for most taxpayers.

Assuming your filing status is single, the following are the tax brackets ( this varies by filing status -married filing jointly/head of household etc.)

Income level of $0- $9,325 and 10% tax bracket

Your short term gains are 10% same as ordinary income, no long term capital gains tax-0%

Income level of $9,326 and 37,950 and 15% tax bracket

Your short term gains are 15% same as ordinary income, no long term capital gains tax -0%

***Post based on our response  on quora.

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Posted In: Tax

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