What is the Capital Gains Tax Rate in New York for 2025?

Unlike federal taxes, where long-term capital gains often receive preferential rates, New York treats both short-term and long-term gains as ordinary income. Short-term capital gains, from assets held for less than a year, already fall into this category at the federal level. However, New York’s system applies the same treatment to long-term gains, meaning higher-income earners may face the top state rate of 10.9%.

Local taxes can also significantly affect your overall liability. For instance, New York City residents pay additional local income taxes ranging from 3.078% to 3.876%, depending on their taxable income. When combined with state rates, high earners could see their capital gains taxed at over 14% before federal taxes are considered.

New York’s approach to capital gains taxation in 2025 highlights the importance of careful financial planning. With combined state and local rates potentially exceeding 14% for some taxpayers, understanding your obligations and leveraging tax-saving strategies can make a significant difference in your financial outcomes.