Zero Tax on Capital Gains
Most people get taxed at 15% or 20% for their long-term capital gains. However, if you are an investor in the two lowest income tax brackets, you don’t pay any taxes on your capital gains and dividends!
This is great news for retirees in particular, as they have a higher standard deduction than younger taxpayers due to Social Security benefits. Also, if you are an unemployed retiree, you’ve been probably thinking to tap on your investments to live a better life.
In order to benefit from the 0% capital-gains rate in 2018, your taxable income has to be lower than $38,600 on individual returns and $77,200 on joint returns.
