Long-term collectible gains are taxed at your marginal rate, capped at 28% federal (vs. 20% max for stocks). Add 3.8% NIIT if your MAGI exceeds $200k/$250k, plus your state rate. Short-term gains are taxed as ordinary income up to 37%.
Use our free calculator to estimate your total tax in under 30 seconds.
Sold a collectible for a profit? The IRS wants a cut — and it's bigger than you might expect. Collectibles have their own special tax rate: up to 28% federal, versus 20% for stocks. Stack on the 3.8% NIIT and state taxes, and you could be looking at 40%+ of your gain gone.
Here's what you need to know.
What counts as a “collectible”?
The IRS definition (IRC §408(m)(2)) is broader than most people think: art, rugs, antiques, metals (gold bars, silver), gems, stamps, coins, and alcoholic beverages. There's also a catch-all for “other tangible personal property.”
Trading cards, sneakers, and watches aren't explicitly listed, but most tax pros treat them as collectibles to be safe. NFTs tied to collectible assets also fall under this classification.
Physically-backed gold ETFs like GLD and IAU are taxed at the 28% collectibles rate — not the regular capital gains rate. Physical gold (including Costco gold bars) gets the same treatment. See our gold ETF tax guide for the full breakdown, including K-1 complications and the 1099-B trap.
The 28% rate: it's a cap, not a flat tax
This is the part most people get wrong. You don't automatically pay 28%. That's the maximum. If your income puts you in a lower bracket, you pay the lower rate.
Sarah earns $45,000 and sells a painting for a $30,000 gain.
| Layer | Tax |
|---|---|
| $30k–$50.6k (12% bracket) | $2,472 |
| $50.6k–$60k (22% bracket) | $2,068 |
| Federal tax on gain | $4,540 (15.1%) |
Sarah pays 15.1%, not 28%, because her income keeps her in lower brackets.
Short-term vs. long-term
The 28% cap only applies if you held the item over one year. Sell within a year? It's taxed as ordinary income — up to 37%.
NIIT: the extra 3.8%
If your income exceeds $200k (single) or $250k (married), you owe an additional 3.8% on investment income. That brings the federal max to 31.8%. These thresholds haven't changed since 2013.
State taxes: the third layer
Most states tax capital gains as ordinary income. The worst offenders: California (13.3%), New York (10.9%), New Jersey (10.75%). A California collector could face a combined rate above 48%. But seven states offer reduced rates or exclusions that can significantly lower your bill.
Florida, Texas, Nevada, and Wyoming have no income tax. If you're buying physical metals, sales tax varies widely by state too — and what you pay adds to your cost basis.
What changed with the OBBBA (2025)
The One Big Beautiful Bill Act kept the existing rate structure through 2028. The 28% collectibles cap, NIIT thresholds, and income brackets are all unchanged. The OBBBA also restored the 1099-K threshold to $20,000/200 transactions.
Inherited vs. gifted collectibles
Inherited: You get a “stepped-up” basis to fair market value at death. Grandpa bought a painting for $500, it's worth $50k when he passes — your basis is $50k.
Gifted: You take the giver's original basis. That $3,000 watch your aunt gifted you? Your basis is $3,000, even if it's now worth $15k. See our Cost Basis Guide for what else counts toward basis — grading fees, shipping, and more.
Your IRS classification (hobbyist, investor, or dealer) also affects which rate applies and what you can deduct — take our hobby vs. business quiz to find out where you fall. When you're ready to file, our step-by-step reporting guide walks through Form 8949 and Schedule D.
See what you'll actually owe
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