Is there any changes in the new tax law that changes the rules that apply to calculation of capital gain when selling your rental property?

[DS30 · Accepted solution]

No - There are not changes to the way capital gains are calculated on the sale of a rental property under the Tax Cuts and Jobs Act of 2017. However, the income brackets related to all long-term capital gains has changed.

For long-term capital gains - The capital gains rates did not change under the Tax Cuts and Jobs Act. The long-term capital gains tax rates of 0%, 15%, and 20% still apply. However, the way they are applied has changed slightly. Under previous tax law, the 0% rate was applied to the two lowest tax brackets, the 15% rate was applied to the next four, and the 20% rate was applied to the top bracket.

Under the Tax Cuts and Jobs Act the brackets are:

• Single Taxpayers - 0% (up to $38,600), 15% ($38,600-$425,800), 20% (Over $425,800)
• Married Filing Jointly - 0% (Up to $77,200), 15% ($77,200-$479,000), 20% (Over $479,000)
• Head of Household - 0% (Up to $51,700), 15% ($51,700-$452,400), 20% (Over $452,400)
• Married Filing Separately - 0% (up to $38,6000), 15% ($38,600-$239,500), 20% (Over $239,500)