Q. My accountant says that part of my capital gains qualify for a 0% federal tax rate this year. Is that possible? L.L., Bloomington, Minn.
A. Yes. Assuming you’ve held the property longer than a year (i.e., a long-term gain), the federal capital gains tax rate is 0% for taxpayers on gains that fall within the 10% and 15% tax brackets. The upper end of the 15% bracket for 2013 is $36,250 for single filers and $72,500 for married joint filers. For instance, if you’re a joint filer with $60,000 of taxable income from other sources, you can have up to $12,500 of long-term capital gains taxed at the 0% rate.
Tip: Take advantage of this tax break at year-end if you can squeeze in under the threshold.