States With No Capital Gains Tax
Nine states have no personal income tax and therefore no capital gains tax: Alaska, Florida, Nevada, New Hampshire (no tax on wages or capital gains), South Dakota, Tennessee (no tax on wages), Texas, Washington (see note), and Wyoming. Washington state enacted a 7% tax on long-term capital gains from financial assets (stocks, bonds) above $250,000 in 2021, effective 2022.
States With the Highest Capital Gains Tax Rates
States with highest capital gains tax rates — 2025
| State | Capital Gains Tax Treatment | Top Rate | Combined with Federal (20%) + NIIT (3.8%) |
|---|---|---|---|
| California | Taxed as ordinary income | 13.3% | 37.1% |
| New Jersey | Taxed as ordinary income | 10.75% | 34.55% |
| Oregon | Taxed as ordinary income | 9.9% | 33.7% |
| Minnesota | Taxed as ordinary income | 9.85% | 33.65% |
| Vermont | Taxed as ordinary income | 8.75% | 32.55% |
| New York + NYC | Taxed as ordinary income + city | 14.78% combined | 38.58% (highest in US) |
| Hawaii | Taxed as ordinary income | 7.25% | 31.05% |
| Maine | Taxed as ordinary income | 7.15% | 30.95% |
States With Preferential Capital Gains Treatment
- Wisconsin: 30% exclusion for net long-term capital gains from Wisconsin assets
- South Carolina: Up to 44% of net long-term capital gains excluded for assets held more than 5 years
- Colorado: 0.46% deduction on net capital gains (minor benefit)
- Massachusetts: 5% flat rate — capital gains taxed same as other income (but low flat rate vs most states)
- New Hampshire: No tax on wages or capital gains from financial assets (only dividends and interest, being phased out)
- Washington: 7% only on gains over $250,000 from financial assets — no tax below this threshold
New York City residents face federal (20%) + NIIT (3.8%) + New York state (10.9%) + NYC city tax (3.876%) = 38.58% combined maximum capital gains rate. This is the highest combined capital gains rate anywhere in the United States — nearly 15 percentage points above Texas investors facing the same federal rate.
Moving Before a Major Capital Gain: What You Need to Know
Relocating from a high-tax to a low-tax state before realizing a large capital gain can save significantly. However, states scrutinize large realizations after moving for signs of domicile manipulation. A genuine move requires: actually residing in the new state as your primary residence, changing your voter registration, changing your driver’s license, updating your bank and investment accounts, and spending the majority of your time in the new state. Part-year resident returns may split the gain between states.
Calculate Your State + Federal Capital Gains Tax
Select your state to see the combined federal and state capital gains tax on your investment sale.