Tax drag is the reduction in investment growth caused by taxes paid along the way, such as taxes on dividends, interest, or realized gains.

Does this calculator predict investment returns?

No. It uses the return assumption you enter and provides an educational estimate. Real returns can be higher, lower, or negative.

Taxable Investment Growth Calculator: After-Tax Value Estimate

Q: What is a taxable investment account?

A taxable investment account is a non-retirement brokerage account. It does not have the same contribution limits as retirement accounts, but dividends, interest, and realized gains can create taxes.

Q: Does this include all taxes?

No. It does not model federal brackets, state taxes, NIIT, qualified dividends, tax-loss harvesting, wash sales, mutual fund distributions, or changing tax law.

Published: June 19, 2026 · Updated: June 19, 2026 · Maintained by: WealthScope Hub Editorial Team

How this calculator works

This calculator estimates taxable brokerage account growth using a simplified compounding model. It subtracts an estimated annual tax drag from your expected return, then applies a final capital gains tax rate to estimated unrealized gains at sale.

estimated after-tax growth rate = expected annual return - annual tax drag

tax at sale = max(ending value - contributions, 0) x capital gains tax rate

after-tax value = ending value - estimated tax at sale

Worked example

Suppose you start with $25,000, add $500 per month for 20 years, assume a 7% annual return, estimate 0.6% annual tax drag, and use a 15% capital gains tax rate at sale. Your total contributions would be $145,000. The calculator estimates the ending value, possible tax due on the gain, after-tax value, and inflation-adjusted value.

What this does not model

Taxable investing is more complicated than one tax rate. This tool does not model federal tax brackets, state taxes, the net investment income tax, qualified dividend rules, interest income, tax-loss harvesting, mutual fund capital gain distributions, wash sale rules, charitable giving, step-up in basis, or changes in tax law.

Related tools & guides

Plain-English guide: Taxable account investing basics
Retirement target: Retirement Savings Goal Calculator
IRA comparison: Roth vs Traditional IRA Calculator

Frequently asked questions

What is a taxable investment account?

It is a non-retirement brokerage account. It can be flexible, but dividends, interest, and realized gains may be taxable.

What is tax drag?

Tax drag is the return reduction caused by taxes paid along the way.

Does this predict investment returns?

No. The calculator only uses the assumptions you enter.

Does this include all taxes?

No. It is a simplified educational model and leaves out many real tax details.

Important note

This page is educational only and is not financial, investment, tax, legal, or accounting advice. Investment returns are not guaranteed, and taxable account results can vary widely. Sources for general concepts: SEC Investor.gov compound interest resources and IRS Topic No. 409, Capital Gains and Losses.