Capital gains tax is a consideration if you're selling your home. Short-term capital gains tax applies to profits on investments owned less than a year, and they're calculated at the income tax rate – up to a maximum of 37 percent. Long-term capital gains tax, however, maxes out at 20 percent. It's important to note that there is a capital gains tax exclusion. If you're a first-time seller of a personal residence, you can exclude a specific amount of your capital gain from taxation according to the following guidelines: -Those who file single returns can exclude up to $250,000 of the capital gain. -Those who file joint returns can exclude up to $500,000 of the capital gain.