Long-term capital gains tax is a tax on profits from the sale of an asset held for more than a year. The long-term capital gains tax rate is 0%, 15% or 20% depending on your taxable income and Of course, this legal avoidance of having to pay the Tax Man is directly connected to the capital gains tax rate itself, so it is something worth keeping an eye on. Here are 10 ways to either reduce or completely sidestep paying capital gains taxes and improve your financial well-being. If you want to avoid paying taxes, you’ll need to make your tax deductions equal to or greater than your income. For example, using the case where the IRS interactive tax assistant calculated a standard tax deduction of $24,400 if you and your spouse earned $24,000 that tax year, you will pay nothing in taxes.