Middle Class Savings Act

This bill, called the Middle Class Savings Act, would update the dollar cutoffs for capital gains tax brackets so they match the current breakpoints used for regular income tax brackets. In plain terms, it lines up the income ranges used to decide which capital gains rate you pay with the ranges already used for ordinary income taxes.

If it becomes law, the change would apply starting with the 2025 tax year (taxable years beginning after December 31, 2024). This could change which capital gains rate a household pays by moving the thresholds to today’s income bracket levels.

Key points:

• Who is affected: People who have capital gains (like from selling stocks or a home that isn’t your primary residence).
• What changes: Capital gains bracket thresholds would be aligned with the current ordinary income tax bracket breakpoints.
• When: For tax years starting after December 31, 2024 (the 2025 filing year and beyond).