Estimate your capital gains tax
Enter your purchase price, improvements, sale figures, and filing status. For a rental, add prior depreciation to capture recapture.
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Home Sale Capital Gains Tax Calculator
Estimate the capital gains tax on the sale of a home in Illinois, including the Section 121 primary-residence exclusion, federal long-term rates, the net investment income tax, and the Illinois income tax. This is an estimate, not tax advice.
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The Section 121 exclusion
If you owned and used the home as your main residence for at least 2 of the last 5 years, you can generally exclude up to 250,000 dollars of gain if single, or 500,000 dollars if married filing jointly. Gain above the exclusion is taxed at federal long-term rates, and Illinois taxes the gain as ordinary income at 4.95 percent.
2026 federal long-term capital gains brackets
| Rate | Single | Married filing jointly | Head of household |
|---|---|---|---|
| 0 percent | Up to $49,450 | Up to $98,900 | Up to $66,200 |
| 15 percent | $49,451 to $545,500 | $98,901 to $613,700 | $66,201 to $579,600 |
| 20 percent | Over $545,500 | Over $613,700 | Over $579,600 |
A 3.8 percent net investment income tax can apply above 200,000 dollars of modified income (250,000 dollars if married filing jointly). Section 1250 depreciation on a rental is recaptured at up to 25 percent.
How capital gains tax on a home works
Your taxable gain is the sale price minus selling costs, minus your adjusted basis. Adjusted basis is what you paid plus capital improvements, reduced by any depreciation you claimed if the home was a rental. The Section 121 exclusion then removes up to 250,000 dollars of gain for a single filer or 500,000 dollars for joint filers who meet the ownership and use tests.
Gain above the exclusion is taxed at the federal long-term rate of 0, 15, or 20 percent based on your income, and a 3.8 percent net investment income tax can apply at higher incomes. Illinois does not give capital gains any special treatment, so it taxes the gain as ordinary income at its flat 4.95 percent rate. Depreciation taken on a former rental is recaptured at up to 25 percent and is not covered by the exclusion.
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Capital gains FAQs
How much capital gains can I exclude on a home sale?
If you owned and lived in the home as your main residence for at least 2 of the last 5 years, you can generally exclude up to 250,000 dollars of gain if single, or 500,000 dollars if married filing jointly. Gain above that is taxable.
Does Illinois tax capital gains?
Yes. Illinois has a flat 4.95 percent individual income tax and gives capital gains no preferential treatment, so a taxable gain is taxed as ordinary income at 4.95 percent on top of any federal tax.
What is the net investment income tax?
It is an additional 3.8 percent federal tax that can apply to investment income, including a taxable home-sale gain, when modified adjusted gross income is above 200,000 dollars for single filers or 250,000 dollars for joint filers. Gain excluded under Section 121 is not subject to it.
Do I owe tax if the home was a rental?
Possibly more. Depreciation you claimed while it was a rental is recaptured at up to 25 percent and is not covered by the primary-residence exclusion, so a rental conversion changes the math. Confirm with a tax professional.
Is this calculator tax advice?
No. It is a free estimate using current rates and common assumptions. Your actual tax depends on your full return. Confirm with a qualified tax professional before relying on any figure.
This calculator is general information for Chicago-area owners, buyers, and investors. It is not legal, tax, lending, appraisal, or brokerage advice, and rates or rules can change. Verify figures with the appropriate professionals before money moves or documents are signed. Tax results depend on your complete return and are not a substitute for advice from a qualified tax professional.