Short-term capital gains tax : Gains on assets held for a year or less are considered short-term capital gains and treated as ordinary income, which is taxed at your marginal income tax rate. Long-term capital gains tax: Gains on assets held for more than a year are considered long-term capital gains and usually taxed at a more favorable rate, which is often lower than the marginal tax rate. Because the capital gains tax is 0% for some income brackets, it can make sense to hold off on the sale until you meet the threshold for paying no capital gains tax.