Does Maine have a special capital gains tax rate?

No. Maine taxes capital gains as ordinary income using its graduated 5.8%, 6.75%, and 7.15% brackets. There is no reduced rate for long-term gains at the state level, so larger gains face the 7.15% Maine marginal rate plus federal tax.

How are long-term federal capital gains taxed?

Long-term gains use preferential federal rates of 0%, 15%, or 20% depending on your total taxable income. The gain stacks on top of your ordinary income, so part of it may fall in the 0% band while the rest is taxed at 15% or 20%.

What is the net investment income tax?

The NIIT is an extra 3.8% surtax on investment income, including capital gains, for taxpayers with modified adjusted gross income above $200,000 single or $250,000 married filing jointly. It applies only to the income above that threshold.

How are short-term gains taxed?

Assets held one year or less produce short-term gains, which are taxed as ordinary income at your federal marginal rate (10% to 37%) plus Maine's ordinary rates. Short-term gains usually cost considerably more than long-term gains.

Can I lower my Maine capital gains tax?

Holding assets longer than a year to qualify for long-term federal rates, harvesting losses to offset gains, and timing sales into lower-income years can all reduce the bill. This tool estimates the tax under current rules but is not personalized advice.

Maine Capital Gains Tax Calculator

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Selling an investment in Maine triggers two taxes: the federal capital gains tax and Maine’s state income tax. Because Maine gives no break for long-term gains, the state side is simply your ordinary rate. This calculator combines both so you can see the full cost of a sale.

How it works

The federal treatment depends on how long you held the asset. Long-term gains (held more than a year) use preferential rates that stack on your other taxable income:

0%  up to $47,025 single / $94,050 joint of total income
15% from there up to $518,900 / $583,750
20% above those thresholds

Short-term gains (held a year or less) are taxed at your ordinary federal rate. A 3.8 percent net investment income tax applies to gains above 200,000 dollars single or 250,000 dollars joint of modified AGI. Maine then taxes the entire gain as ordinary income at 5.8 / 6.75 / 7.15 percent, stacked on your other income, so for higher-income filers the state share approaches 7.15 percent.

Example

A single filer with 80,000 dollars of other income and a 20,000 dollar long-term gain has already used the 0 percent band, so the federal gain is taxed at 15 percent (3,000 dollars). Maine adds roughly 7.15 percent (about 1,430 dollars). Total tax on the gain is about 4,430 dollars, leaving about 15,570 dollars after tax.

Notes

This is a simplified model. Real returns involve loss carryovers, the exact NIIT calculation on net investment income, qualified dividends, and Maine’s standard deduction and personal exemptions, none of which are fully modeled here. Use it for planning and confirm with the current rules at irs.gov and maine.gov/revenue.