Tax Policy Blog, Mad Men and Taxes (No Spoilers!), by Joseph Henchman:

If you haven't watched last night's season four finale of Mad Men, I won't give anything away other than something you already knew: Don Draper is selling his Ossining, NY house where he's been letting his ex-wife and her new husband live. His accountant helps him figure out the sale, to which Don grouches, "What's the capital gains tax, 48%?"

Not quite, Don, although the comment should make viewers aware of the higher tax rates of 1965 compared to today. Don's probably got income taxes in his head: the federal income tax in 1965 topped out at 70% on income over $100,000, having been reduced from 90% by the Kennedy-Johnson tax cut of 1964. (Today it's 35%, and scheduled to go to 39.6% on January 1, 2011.) Don Draper is probably in that top tax bracket, since he has the cash on hand to lend the firm $150,000 as he just did. (Not a loss, an investment!)

Today, the long-term capital gains tax is 15% (scheduled to go to 20% on January 1, 2011); Don's probably paying about twice that. Since 1997, much of one's capital gain from the sale of a home is excluded from tax. (This change has been suggested as a contributing factor to the home-flipping phenomenon and the housing crash.) Before 1997, the exclusion was much smaller and you had to buy another home within a certain timeframe. This generous provision didn't exist for Don Draper; it didn't come about until 1978.