The Internal Revenue Service (IRS) has announced updated tax brackets for the 2026 tax year, including notable adjustments to long-term capital gains rates. These changes can create new opportunities for individuals and families to optimize their investment strategies and reduce tax burdens.

Understanding Capital Gains Taxes

When you sell an investment for more than you originally paid, the profit is known as a capital gain.

• Short-term capital gains, from investments held for one year or less are taxed as ordinary income.
• Long-term capital gains, from assets held for more than one year are taxed at preferential rates of 0%, 15%, or 20%, depending on your taxable income.

What’s Changing in 2026

Under the new IRS rules for 2026:

• Individuals with taxable income up to $49,450 will qualify for the 0% long-term capital gains rate.
• Married couples filing jointly can earn up to $98,900 and still pay no federal tax on long-term gains.
• The 15% rate applies to individuals earning up to $545,500 and joint filers up to $613,700.
• Income beyond those thresholds will be taxed at the 20% rate.

These changes mean that taxpayers can earn more while maintaining lower tax rates, an opportunity that strategic planning can fully unlock.

Why Strategic Planning Matters Now

Although these rates take effect for the 2026 tax year, the time to act is now. The final quarter of 2025 will be especially critical for capital gains management, as investors review portfolios and consider strategies to minimize tax exposure before year-end.

If you currently hold investments that have declined in value, selling them can trigger a capital loss, which may be used to offset taxable gains. This approach, known as tax-loss harvesting, can significantly reduce your overall tax liability, when executed correctly.

How KB CPA Services, P.A. Can Strengthen Your Financial Position

At KB CPA Services, P.A., we help clients turn IRS rule changes into opportunities for financial growth and stability. Our team of experienced tax professionals can:

• Analyze your investment and income profile to determine your optimal tax bracket.
• Develop personalized strategies for managing capital gains and losses efficiently.
• Leverage deductions and credits to minimize taxable income and preserve wealth.
• Plan ahead for 2026 to ensure that your investment and income structures align with the most favorable tax outcomes.

By proactively working with our firm, you can ensure your finances are structured not just for compliance, but for maximum advantage under the new tax landscape.