United StatesCapital loss deductions would have limits that adjust for inflation
Taxpayers other than corporations would have dollar limits on deducting capital losses—losses from selling or exchanging certain assets—beyond their gains.
What it does
For tax years starting in 2026 or later, taxpayers other than corporations could deduct capital losses beyond gains up to a $14,250 base limit, or $7,125 if married and filing separately.
For taxpayers other than corporations, limits on deducting capital losses beyond gains would adjust for inflation. The adjustments would start with tax years beginning in 2027.
Argument forLinking the limits to inflation could keep rising prices from eroding the value of deductions for taxpayers with losses beyond gains.
Argument againstA yearly cap could leave taxpayers with large capital losses unable to deduct all losses beyond their gains in that year.
More detail
Taxpayers other than corporations could use capital losses to offset capital gains and deduct a limited amount of any loss left over. This would cover losses from selling or exchanging capital assets. The base cap would be $14,250, or $7,125 for married people filing separately. The extra deduction could not exceed the loss left after subtracting gains. These rules would apply to losses in tax years beginning after December 31, 2025.
Taxpayers other than corporations would have both deduction limits adjusted for inflation. This would cover the $14,250 limit and the $7,125 limit for married people filing separately. The formula would use the tax code’s cost-of-living measure with 2025 as its base year. Any increase would be rounded to the nearest $25. Adjustments would apply to tax years beginning in calendar years after 2026.
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Where it stands
- Introduced
- Passed House
- Passed Senate
- To President
- Became Law
Looking ahead
No hearings or votes scheduled.
History
- 2026
- Oct 1Introduced in HouseLatest
- Oct 1Referred to the House Committee on Ways and Means.Introduced
Taxes & Budget