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Thank god for the upcoming 3 day weekend. My brain is shot from this week at work.
Question for the week: Do you leverage tax loss harvesting? Why or why not?
Generally, no. Though I did make an exception last year to capture a $6000 loss on my international investment.
Yeah, it saves taxes, so why not?
I intend to be in the 0% long term capital gains tax bracket in early retirement, so it’s a no brainer for me.
I don’t know what this is. Another thing to learn!
Basic summary:
When you sell an investment you are taxed on the gains. If your investment has lost money, you can deduct the difference between what you paid and what you sold the investment for on your taxes. Tax loss harvesting is simply selling investments that have lost value to reduce any taxes owed. Generally, you then buy a similar fund so you keep your money in the market to avoid missing out on any future gains.
There is some complexity since you need to avoid wash sales, which is buying the same or “a substantially equivalent” fund within a 30day window of the sale. You are also limited to a maximum deduction of $3000 per year, though you can roll over any excess to reduce future year taxes.
Oh that’s a cool trick. Thanks for the explanation 😀
Happy first full weekend of college football season!
I love this time of year. Woke up with a few cups of coffee while watching Chelsea vs Nottingham, now on to CFB with a Revolution Brewing Freedom of Speach.
