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Can capital gains affect which tax bracket I am in?



I am trying to figure out how captial gains affects what tax bracket I am in?
Suppose I have no job and no other income. That puts me in the 10% tax bracket. But suppose I invested some money that I already had and made $100,000 in capital gains, would that bump me into a higher tax bracket?The reason I am asking is that I calculate ahead of time how much money I need to set aside from my capital gains to pay for taxes.

If you have $100,000 in capital gains that changes your tax bracket example:

Married filing Joint it is 25% tax bracket
Single is 28%

then, you would have to know if your capital gains are long term or short term.

Long Term - item that was sold held for a year and a day
Short Term - item that was sold held for less than a year or
equal to one year.

Short Term is calculated by the current tax rate 25% or 28% x
$100,000. MFJ = $25,000 S = $28,000
Long Term is calculated at 15% x $100,000 MFJ or S = $15,000

now if you have both Short Term and Long Term it is calculated differently changing the whole scenario the short term gets calculated first so it would go like this

Lets say you had $50,000 in short and $50,000 in long and you are married filing joint the first $15,000 short term would be times 10% the then next $35,000 short term times 15% then $11,300 of the long term would be times 5% and the last $38,700 times 15%. Total $13,120 A bit more complicated, but you can figure it out if you have a 2006 tax rate - quick tax method

http://www.irs.gov/formspubs/article/0,,...

good luck..
In a word, yes.

You would end up being in a tax bracket that would reflect $100,000 in income. However the maximum capital gain tax rate is 15%, which applies to persons in the 25% or higher tax brackets.

In your case, some amount of your gains would be taxed at 0%, some at 5%, and the remainder at 15%. The breakpoints would depend upon your other income and your marital status.
I'm a tax accountant.
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