You've probably heard the rumors floating around about a massive shake-up in how we pay taxes on our investments. With the political landscape shifting faster than a day-trader's portfolio, everyone wants to know: is trump getting rid of capital gains tax or is it all just campaign trail noise?
Honestly, the answer is kind of a "yes and no" situation. It depends on which version of the plan you're looking at and how "getting rid of" is being defined. If you're hoping for a world where nobody ever pays a dime on stock market profits, we aren't there yet. But the changes that just rolled through with the One Big Beautiful Bill (OBBB) in July 2025 definitely move the needle for a lot of people.
The 2026 Reality of Capital Gains
Let’s cut through the jargon. Right now, in early 2026, the short answer is that the capital gains tax hasn't been abolished. It’s still very much a thing. However, the Trump administration has effectively locked in the lower rates we’ve seen over the last few years and has floated some wild ideas for the future.
The core of the current system relies on three main brackets for long-term capital gains: 0%, 15%, and 20%.
For the 2026 tax year, if you’re a married couple filing jointly and your taxable income is under $98,900, you basically pay 0% on your long-term gains. That’s a huge win for middle-class families. For everyone else, those 15% and 20% rates are sticking around for now. While some early policy drafts from groups like the Heritage Foundation suggested cutting that top 20% rate down to 15% across the board, that specific change didn't make it into the final OBBB legislation that President Trump signed.
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Why People Think the Tax is Disappearing
The confusion usually stems from two things: the "Trump Account" and the push for inflation indexing.
First, the Trump Account is a brand-new animal. It’s a tax-advantaged savings vehicle for kids born between 2025 and 2028. The government seeds it with $1,000, and parents can throw in up to $5,000 a year. The cool part? The growth is meant to be tax-free for things like buying a home or retirement. It’s not "getting rid of" the capital gains tax for everyone, but for the next generation, it sort of is.
Then there’s inflation indexing. This is a big one that Trump has talked about for years. Basically, it means you’d only pay tax on the real gain of an asset, not the part of the price increase that was just caused by inflation.
Imagine you bought a cabin for $100,000 and sold it years later for $150,000. Under current rules, you’re taxed on that $50,000 "profit." But if inflation was high during those years, that $150,000 might only buy what $100,000 used to. In that case, you didn't actually get richer—you just kept pace with the dollar. Trump’s proposal to index gains to inflation would effectively eliminate the tax on that "phantom" profit. While this hasn't been fully implemented across all assets yet, it remains a major goal for the administration.
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The Contrast: What Didn't Happen
To understand the current state of capital gains, you have to look at what didn't happen. During the 2024 campaign, the alternative was a plan from the Harris camp that would have actually increased capital gains taxes.
- They proposed raising the top rate to 28% for those making over $1 million.
- There was talk of taxing unrealized gains—meaning you’d pay taxes on the value of your stocks even if you hadn't sold them yet.
- They wanted to treat capital gains as ordinary income for high earners.
By winning and passing the OBBB, Trump didn't necessarily "get rid of" the tax, but he "saved" the current preferential rates from becoming much higher. For a lot of investors, that feels like a win.
Is Trump Getting Rid of Capital Gains Tax Through Tariffs?
Here is where things get really experimental. Trump has frequently suggested—sort of off-the-cuff but also in serious policy speeches—that he’d like to replace the entire federal income tax system with tariffs.
If that ever actually happened, then yes, the capital gains tax would vanish. We’d be a country that funds itself by taxing imports rather than the money people earn or the profits they make on investments. It sounds like something out of the 1800s because, well, that’s how the U.S. actually worked back then.
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However, most economists (and even many of Trump’s allies in Congress) think this is a long shot. Replacing trillions of dollars in tax revenue with tariffs would require a massive hike in the cost of imported goods—some estimate a 58% universal tariff would be needed. For now, this remains a "what if" scenario rather than a "right now" reality.
The SALT Twist and Your Gains
You might not think the SALT (State and Local Tax) deduction matters for capital gains, but it’s all connected. The OBBB raised the SALT cap from $10,000 to $40,000 for 2025-2029.
If you live in a high-tax state like California or New York and you sell a bunch of stock, you’re going to owe state tax on those gains. Under the old rules, you could only deduct $10,000 of those state taxes on your federal return. Now, with the $40,000 cap, you can shield more of your income from federal taxes, which softens the blow of the capital gains you just realized. It’s a backdoor way of making the total tax bill on your investments lower.
Actionable Next Steps for Your Portfolio
Since the tax laws are now largely "set" for the next few years thanks to the OBBB, you can actually plan without worrying about a "tax cliff" at the end of 2025.
- Check Your Brackets: If you’re near the $98,900 threshold (for joint filers), try to stay under it. Selling assets when you're in the 0% bracket is the closest you'll get to Trump "getting rid of" the tax for you personally.
- Look Into Trump Accounts: If you have a child born in 2025 or later, get that $1,000 government seed money. It’s a rare chance for a "tax-free" bucket that isn't as restrictive as a 529 plan.
- Bonus Depreciation: For business owners, the OBBB made 100% bonus depreciation permanent. If your "capital gain" is coming from selling a business or business assets, you might be able to offset it by investing in new equipment or property immediately.
- Hold for the Long Term: The 0/15/20% rates only apply to assets held for more than a year. Short-term gains are still taxed at ordinary income rates, which top out at 37%. Patience literally pays.
So, is the tax gone? No. But it’s lower and more stable than it almost was. Keep an eye on the "inflation indexing" debate in late 2026—that’s the next big battleground that could change your tax bill forever.