How was my capital gains calculated?

There are multiple rules for taxing capital gain.

You are taxed on the the difference between the selling price (proceeds) and the purchase price (basis).

The first refers to the holding period.

• A Short Term Gain, held for one year or less, is taxed as regular income.
• A Long Term Gain, held for greater than a year.
• Gains and loses are tallied for each of the two categories and then taxed. 

To calculate the capital gain/Loss, use these steps

1. Determine your basis. 
2. Determine your proceeds.
3. Subtract the basis (what you paid) from the realized amount (proceeds or what you sold it for) and determine the difference. 
4. Determine your tax from the table above.

There is one more twist

A capital gains rate of 0% applies if your taxable income is less than or equal to: 

• $44,625 for single and married filing separately;
• $89,250 for married filing jointly and qualifying surviving spouse; and. $59,750 for head of household.

For additional information please see Topic no. 409, Capital gains and losses