Guides ยท Finance
Tax Loss Harvesting Basics
Use losses to offset gains
Tax loss harvesting sells positions at a loss to offset gains and up to limited ordinary income, then reinvests in similar (not substantially identical) assets to maintain exposure.
- wash sale
- capital gains
- basis
- replacement security
- offset
Identify Candidates
Find taxable positions with losses and recent gains to offset.
Avoid Wash Sales
Don?t buy substantially identical securities 30 days before/after.
Reinvest
Use similar but not identical replacements to keep allocation.