Capital Gains Tax for Pennsylvania (2026)
Pennsylvania (PA) Key Facts
State Capital Gains Rate
3.07%
Taxed As
Ordinary income
Federal Rate Applies
Yes (0%, 15%, or 20%)
Long Term vs Short Term
Both taxed at state level
How This Calculator Works in Pennsylvania
This calculator estimates your combined federal and Pennsylvania capital gains tax. Enter your gain amount, holding period, and income to see your estimated tax.
Pennsylvania Overview
Pennsylvania taxes capital gains as ordinary income at its flat 3.07% rate, one of the lowest flat rates in the nation. Federal capital gains taxes also apply, with long-term rates of 0%, 15%, or 20% depending on income. The combined state and federal burden should be considered when planning asset sales or investment strategies.
How Pennsylvania Compares
Pennsylvania's capital gains rate of 3.07% compares to New York at 10.9% and New Jersey at 10.75%. State capital gains taxes significantly impact net investment returns.
| State | Top Rate | Notes |
|---|---|---|
| New York | 10.9% | New York has a capital gains rate of 10.9%. |
| New Jersey | 10.75% | New Jersey has a capital gains rate of 10.75%. |
| Ohio | 3.5% | Ohio has a capital gains rate of 3.5%. |
Pennsylvania's capital gains rate of 3.07% compares to a national average of approximately 5.04%. This is below the national average.
Tips for Pennsylvania Residents
- 1Pennsylvania taxes capital gains as ordinary income at its flat 3.07% rate, one of the lowest flat rates in the nation.
- 2Federal long-term gains (held 1+ year) are taxed at 0%, 15%, or 20%. Pennsylvania's state tax applies on top of the federal rate.
- 3Hold investments over one year to qualify for lower federal long-term rates rather than ordinary income rates.
- 4Tax-loss harvesting—selling losing investments to offset gains—reduces both federal and Pennsylvania state capital gains tax.
- 5Consider the combined federal + state rate when planning large asset sales. The total can exceed 26.9% for high earners.