Virginia capital gains tax (2026)
South · Taxed as ordinary income · combined top long-term 29.55%
In Virginia, the effective top rate on long-term capital gains is about 5.75%. Added to the federal top long-term rate of 23.8% (20% plus the 3.8% NIIT), the illustrative combined top long-term rate is 29.55% - ranking #14 of 51 states. Taxes capital gains as ordinary income; top marginal rate 5.75% (a subtraction exists for certain qualified technology-business gains). This is the top-bracket case, not what a typical filer pays, and not tax advice.
Source: Tax Foundation, 2026 state income tax rates. Data as of June 2026.
How Virginia taxes capital gains
Taxes capital gains as ordinary income; top marginal rate 5.75% (a subtraction exists for certain qualified technology-business gains).
| Component | Rate |
|---|---|
| Federal long-term rate (top) | 20% |
| Net Investment Income Tax (NIIT) | 3.8% |
| Federal subtotal (top long-term) | 23.8% |
| Virginia effective top long-term rate | 5.75% |
| Combined top long-term rate | 29.55% |
Source: Tax Foundation, 2026 state income tax rates. Data as of June 2026.
The federal subtotal of 23.8% applies only to top-bracket long-term gains; lower-income filers pay 0% or 15% federally. The Virginia figure is the effective top long-term rate.
Worked example
On a $100,000 long-term gain for a top-bracket investor in Virginia: the state takes roughly 5.75% (about $5,750), federal long-term tax is $20,000, and the 3.8% NIIT adds $3,800 - a combined estimate near $29,550, an effective rate close to 29.55%. Lower-income filers pay less federally (15% or 0%).
Estimate only. Use the calculator with your own numbers.
How Virginia ranks
| Measure | Virginia | Rank (1 = highest) |
|---|---|---|
| Combined top long-term rate | 29.55% | #14 of 51 |
| State effective top long-term rate | 5.75% |
States with a similar capital gains burden
| State | State treatment | Combined top long-term rate |
|---|---|---|
| Virginia (this state) | Taxed as ordinary income | 29.55% |
| Kansas | Taxed as ordinary income | 29.38% |
| Rhode Island | Taxed as ordinary income | 29.79% |
| Wisconsin | 30% exclusion | 29.16% |
| Vermont | 40% exclusion | 29.05% |
| Georgia | Taxed as ordinary income | 28.99% |
Frequently asked questions
Does Virginia tax capital gains?
Yes. Taxes capital gains as ordinary income; top marginal rate 5.75% (a subtraction exists for certain qualified technology-business gains). On top of the state tax you also owe federal capital gains tax (0/15/20% long-term) and, for higher earners, the 3.8% NIIT.
What is the capital gains tax rate in Virginia in 2026?
Virginia's effective top rate on long-term capital gains is about 5.75%. Combined with the top federal long-term rate of 23.8%, the illustrative combined top rate is 29.55% - the top-bracket case, not what most filers pay.
How does Virginia compare with other states on capital gains?
On the illustrative combined top long-term rate, Virginia ranks #14 of 51 (1 = highest). States are compared on their effective top long-term rate plus the federal 23.8% top. See the rankings for the full picture.
Are short-term capital gains taxed differently in Virginia?
Generally short-term gains are taxed as ordinary Virginia income (the headline rate), while any state preferential rate or exclusion usually applies only to long-term gains. Federally, short-term gains are ordinary income (up to 37%).
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Sources & accuracy
Virginia treatment from Tax Foundation, 2026 state income tax rates and the state revenue department (find Virginia's tax authority). Federal figures from the IRS. Data as of June 2026 for the 2026 tax year. Rates change and special rules have conditions - this is general information, not tax advice. Verify with the official source or a tax professional. See our methodology and disclaimer.
Last updated: 2026-06-21