As a tax-loss harvesting investor, you may have experienced the frustration of losing money from a bad investment. As experts in tax-loss harvesting, our team of financial advisers understands how difficult handling taxes on gains and income can be. Tax benefits from tax-loss harvesting can help you with some of your losses.

This strategy focuses on selling investments that resulted in losses and then using these losses to write off some of your tax return dues. Tax rules in the United States, currently, allow you to utilize capital losses for a large number of gains. Our tax-loss harvesting accountants can help you benefit from this strategy.

If capital losses remain even after offsetting your gains, you can usually apply as much as $3,000 of your capital loss to offset your ordinary income. Ordinary income includes salaries, wages, and business profits. Tax-loss harvesting financial advisers commonly use this process during the final quarter of the tax year. However, you can utilize this process any time with the help of our trusted tax-loss harvesting CPAs.

Savings From Tax Loss Harvesting

Your tax bracket will plays a big role in determining your overall tax dues and your equivalent tax savings. Stock or other securities investors are taxed differently by the IRS. Your holding period will likewise affect these values. For example, gains made from securities that have been held for less than a year are traditionally categorized as short term gains, while those from securities that are usually held for more extended periods are grouped as long term gains. Higher tax rates apply to those in the former group, making it more attractive to those trying to avoid taxes. Our team of tax-loss harvesting CPAs can provide you with more information on how you can save money with your current portfolio.

Tax-loss harvesting tax planning applies the same with capital losses. You can usually offset your short term gains along with your short term losses. Similarly, you can use your long term gains on your long term losses. Whatever is left after offsetting will be your net taxable income for the period.

Things To Consider When Tax Loss Harvesting

A crucial step in tax loss harvesting is knowing when to sell your securities. When tax-loss harvesting, our CFO advisory can provide you with an excellent insight for this step. You should also keep in mind that you are restricted from repurchasing your stock right away. This rule is referred to as the “Wash Sales” rule. It means that investors have to wait at least thirty days from the sale before buying the same stocks. Although there are no applicable penalties, breaking this rule will forfeit the benefits of tax-loss harvesting.

Although losses should generally be avoided, it can be a way to reduce your payables to the IRS. However, you need expert help and advice to be able to do this properly. Our knowledgeable accountants here at FusionCPA can help you make sure that tax-loss harvesting can be a really a big help to your livelihood. We also provide streamlined tax planning and bookkeeping services for tax-loss harvesting businesses like yours. Feel free to contact us through our website for any inquiries or to schedule an appointment now. Here in FusionCPA, we want to help you make the best decisions for your future.


This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.