Long-term capital gains rates are 0%, 15% or 20%, and married couples filing together fall into the 0% bracket for 2021 with taxable income of $80,800 or less .For example, let's say a married couple filing together makes a joint gross income of $100,000 for 2021.
If the couple has itemized deductions above $25,100 — such as state and local taxes, medical expenses or charitable gifts — they may claim a higher write-off and earn more income while staying below the limits, Brown said. "I have had clients with low six-figure incomes that, due to the composition of their income, paid absolutely no federal tax," Brown said, explaining how someone with only long-term capital gains, qualified dividends and tax-exempt municipal bond interest may not have taxable income.
However, investors need to be mindful of how much they sell from a taxable portfolio, as the tactic boosts income and may exceed the thresholds or trigger other consequences, he said.
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