Search found 2952 matches

by House Blend
Fri Sep 04, 2015 10:20 am
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvest - Wash Sale - Your 401k
Replies: 23
Views: 1360

Re: Tax Loss Harvest - Wash Sale - Your 401k

^I believe that the robo-advisors are well aware of these issues even if many of their customers and cheerleaders are not. For example, a search of betterment's website turns up this article: How do I safely use TLH+ if I have external accounts? Summarizing, they recommend the following for their cu...
by House Blend
Fri Sep 04, 2015 9:07 am
Forum: Investing - Theory, News & General
Topic: Comprehensive list of tax loss harvesting partners
Replies: 60
Views: 2967

Re: Comprehensive list of tax loss harvesting partners

I don't know that "tracking error" is really a part of the case law around wash sales. After all, the rule is that two bonds with maturity dates not that far apart issued by the same company are not substantially identical if they have very different coupon rates. These two bonds would ha...
by House Blend
Fri Sep 04, 2015 8:51 am
Forum: Investing - Theory, News & General
Topic: US stock fund vs International stock fund, relative strength
Replies: 8
Views: 877

Re: US stock fund vs International stock fund, relative strength

On a growth chart, when comparing two growth charts, the effect of the starting point is to slide one of the two curves up and down relative to the other. The choice of starting point is effectively sliding one curve up until it crosses the other at the starting point. If you were to plot the "...
by House Blend
Thu Sep 03, 2015 12:59 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

^Shrug. There's lots of hypothetical possibilities one can worry about. Until the IRS provides more guidance, or Congress rewrites the wash sale law, I can agree with Kitces that if your two funds have low correlation, that's an argument your tax lawyer should make in your defense that it is not a w...
by House Blend
Thu Sep 03, 2015 11:21 am
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

I liked the Kitces article. I do disagree with Kitces that correlation is or should be the ultimate purity test for deciding when mutual funds are "substantially identical". Suppose a ruling is handed down which ends up drawing the line a bit more conservatively than expected, and ends up ...
by House Blend
Thu Sep 03, 2015 10:06 am
Forum: Investing - Help with Personal Investments
Topic: I think this is appropriate tax-loss harvesting...
Replies: 7
Views: 592

Re: I think this is appropriate tax-loss harvesting...

VLCAX to be held for at least 31 days starting 9/2. No re-investing of dividends in VTSAX or VLCAX: all dividends going to money market fund. No wash sale, but notice that a dividend for VLCAX will be declared on 9/23. If you sell those shares of VLCAX after 9/23 but hold them for less than 61 days...
by House Blend
Wed Sep 02, 2015 9:33 pm
Forum: Investing - Theory, News & General
Topic: Corrections for the wiki article on TLH
Replies: 3
Views: 361

Re: Corrections for the wiki article on TLH

Thanks, looks good. Since there are really two issues here (tax exempt interest and cap gain distributions), I would suggest changing the header on that paragraph to Loss on mutual fund shares held 6 months or less. Also, the old paragraph had a link to the fairmark article that I thought was worth ...
by House Blend
Wed Sep 02, 2015 5:09 pm
Forum: Investing - Theory, News & General
Topic: Corrections for the wiki article on TLH
Replies: 3
Views: 361

Corrections for the wiki article on TLH

Wiki workers, I was looking at the wiki article on TLH today. Nice, but one paragraph caught my eye as stale and muddle-headed: https://www.bogleheads.org/wiki/Tax_loss_harvesting Short-term capital loss due to tax-exempt interest . If you have short-term capital loss due to tax-exempt interest from...
by House Blend
Wed Sep 02, 2015 4:52 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

"You must sell them in a separate transaction at least one day before you sell the shares in your taxable account." Where is the bolded portion, "one day before" coming from when selling shares in an IRA purchased within the last 30 days and you want to TLH from the same fund in...
by House Blend
Wed Sep 02, 2015 10:02 am
Forum: Investing - Help with Personal Investments
Topic: Tax loss harvesting VGTSX (Vanguard Total International)
Replies: 15
Views: 870

Re: Tax loss harvesting VGTSX (Vanguard Total International)

Just of out of curiosity, I know that TLH is by-and-large a tax deferral (rather than a true 'break') since you end up paying more in capital gains due to the lower cost basis. Does this mean that someone who plans to earn substantially less in retirement would benefit most from TLH? I'm in the 25%...
by House Blend
Wed Sep 02, 2015 9:47 am
Forum: Investing - Help with Personal Investments
Topic: Roth conversion/recharacterization game or 0% cap gains tax rate
Replies: 7
Views: 595

Re: Roth conversion/recharacterization game or 0% cap gains tax rate

Since tax gains harvesting can't be dialed in as accurately, because the recharacterization option doesn't exist, I'm thinking of selling a "safe" amount of mutual funds with gains, say $20K of LTCG, and converting $10K-$15K, or whatever is likely to put her a bit above the 15% bracket, a...
by House Blend
Tue Sep 01, 2015 8:55 pm
Forum: Investing - Help with Personal Investments
Topic: I think I messed up my TLH - partial wash question
Replies: 2
Views: 214

Re: I think I messed up my TLH - partial wash question

Welcome to the forum. Yes, this is the bad kind of wash sale, where you don't get to claim part of the loss and as a result you end up with more than your fair share of capital gains. I don't think it can be fixed at this point. Say you bought 100 shares in the IRA on 8/7. You bought 1000 shares in ...
by House Blend
Tue Sep 01, 2015 3:15 pm
Forum: Investing - Theory, News & General
Topic: TLH conclusion in my situation
Replies: 20
Views: 1124

Re: TLH conclusion in my situation

Keep in mind that wash sales involving an IRA are a bit more delicate. It is not clear cut whether you have might have a wash sale if you sell all shares of Fund X in an IRA before you sell any shares of Fund X in taxable at a loss. And notice that in the space of a week, livesoft has apparently cha...
by House Blend
Mon Aug 31, 2015 4:44 pm
Forum: Investing - Help with Personal Investments
Topic: Friend's proposed RMD strategy--A little different
Replies: 55
Views: 4263

Re: Friend's proposed RMD strategy--A little different

celia, My previous post was aimed only at the specific question raised by the OP. That is, whether it makes sense to market-time RMDs for dips if you are over age 70.5 with plans to pass on 100% of a tax-deferred IRA, plus the taxable assets created by RMDs from that account, to beneficiaries. I agr...
by House Blend
Mon Aug 31, 2015 12:48 pm
Forum: Investing - Help with Personal Investments
Topic: Friend's proposed RMD strategy--A little different
Replies: 55
Views: 4263

Re: Friend's proposed RMD strategy--A little different

I'm not sure if this thread is still focused on the OP, but in that situation (trad IRA and post-RMD taxable money will be passed on 100% to beneficiaries and not spent by the account owner), my opinion is that the timing of RMDs is a secondary consideration at best, and can be counterproductive. Th...
by House Blend
Mon Aug 31, 2015 11:12 am
Forum: Investing - Help with Personal Investments
Topic: Friend's proposed RMD strategy--A little different
Replies: 55
Views: 4263

Re: Friend's proposed RMD strategy--A little different

It does bring up an interesting point--that if there is a massive crash It might be worth pulling out more on top of one's RMD provided it is reinvested at the much lower price on the taxable side. This is never a good idea. If you won't be spending the money right away, any amounts in excess of an...
by House Blend
Sun Aug 30, 2015 4:19 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

I am not sure why any of what I wrote is obtuse. I don't want to apologize for anything Vanguard does or does not do, but I can state that Vanguard shows me online the cost basis for the non-covered shares in my taxable account. Vanguard also shows me online every individual purchase made with numb...
by House Blend
Sun Aug 30, 2015 2:13 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

^Posting how trivial things are for you isn't helpful. Being deliberately obtuse isn't helpful either. Apropos of the post from KIS, there is a silver lining: the market will have to drop quite a bit further before people are likely to have any non-covered shares worth harvesting. If that happens, I...
by House Blend
Fri Aug 28, 2015 3:56 pm
Forum: Investing - Theory, News & General
Topic: Double check your TLH calculation...This error cost me
Replies: 16
Views: 1802

Re: Double check your TLH calculation...This error cost me

I also think that if one is practicing tax-loss harvesting routinely, then one would very rarely have to TLH lots from 2011 (or even 2014 and before). It has been mentioned several times to always start the new calendar year with no lots that have losses because one has already tax-loss harvested t...
by House Blend
Fri Aug 28, 2015 1:22 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

Note, though, that the reason I was confused is that I had never sold shares in my Fund, yet they were still showing the same average cost for each lot. I waited two or three days before I TLH after switching to specific id, and though they said the change would be "complete" in a day, it...
by House Blend
Fri Aug 28, 2015 12:54 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

Replace Note that this will take a day or two for the company to process, and once you do it for the first time, if you've never sold any shares in that Fund (and you are boglehead so you probably haven't, right?), every "lot" of shares you have purchased *before* making the change will be...
by House Blend
Fri Aug 28, 2015 12:32 pm
Forum: Investing - Theory, News & General
Topic: TLH for absolute dummies [Tax Loss Harvesting]
Replies: 136
Views: 9158

Re: TLH for absolute dummies [Tax Loss Harvesting]

Step 0: IGNORE THIS STEP FOR NOW if you are a newish investor whose Initial Fund currently has a cost-basis method of "average cost" and you show losses in the Fund as a whole. Otherwise, go to your Account Settings in your Initial Fund and change the cost-basis method to "specific i...
by House Blend
Fri Aug 28, 2015 9:54 am
Forum: Investing - Help with Personal Investments
Topic: Help Choosing 401(k) Funds & Wealthfront vs. Betterment
Replies: 2
Views: 999

Re: Help Choosing 401(k) Funds & Wealthfront vs. Betterment

Using two robo-advisors at the same time is IMO a mistake. Even if you instruct one or both of them not to engage in tax loss harvesting, you can inadvertently create wash sales whenever you sell in one account if there is an ill-timed buy in the other account. Not that there's anything horrific abo...
by House Blend
Fri Aug 28, 2015 9:33 am
Forum: Investing - Help with Personal Investments
Topic: TLH aftermath - what to do with $170 VTSMX left in tIRA
Replies: 3
Views: 778

Re: TLH aftermath - what to do with $170 VTSMX left in tIRA

Convert the tIRA to Roth, and don't use TSM in the Roth.
by House Blend
Thu Aug 27, 2015 2:30 pm
Forum: Investing - Help with Personal Investments
Topic: Tax lots and TLH question
Replies: 19
Views: 1115

Re: Tax lots and TLH question

Just stop being fooled by all the posts here. Use Spec ID for all your funds and do it all the time.[/color] Just a quick point: if you switch right now to "specific id," Vanguard at least doesn't "backdate" your basis to whatever you actually paid. It just takes each lot and pr...
by House Blend
Thu Aug 27, 2015 2:00 pm
Forum: Investing - Help with Personal Investments
Topic: Tax lots and TLH question
Replies: 19
Views: 1115

Re: Tax lots and TLH question

- most people on here are talking about exchanging an entire fund, not specific tax lots. If you are doing it this way, what is the benefit of using spec ID for your cost basis? It seems that the Vanguard default of average cost would be sufficient. Using average basis while trying to TLH is like t...
by House Blend
Thu Aug 27, 2015 10:42 am
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvesting TLH - Dividend distribution Timing
Replies: 5
Views: 1187

Re: Tax Loss Harvesting TLH - Dividend distribution Timing

Looks fine, but what about the dividend distributions from Fund B? Maybe it doesn't apply in this case, but often when you trade from Fund A to Fund B before the dividend from A, you aren't actually avoiding a dividend, you are simply trading one dividend for another. And there's a free lunch when t...
by House Blend
Thu Aug 27, 2015 10:27 am
Forum: Investing - Help with Personal Investments
Topic: Identical fund in two accounts: possible to avoid wash sale rule?
Replies: 14
Views: 1846

Re: Identical fund in two accounts: possible to avoid wash sale rule?

So the safe way to do this is to completely exit the TR fund in the Roth 401(k) first. Then after 31 days exchange out of the TR fund in taxable into index funds (TSM, TISM,...) that you can hold long term. Whether you'll have gains or losses at that point is anyones guess, but you'll be in a posit...
by House Blend
Wed Aug 26, 2015 8:51 pm
Forum: Investing - Help with Personal Investments
Topic: Is Tax Loss Harvesting Worth It in the 0% Cap Gains Bracket?
Replies: 11
Views: 1097

Re: Is Tax Loss Harvesting Worth It in the 0% Cap Gains Bracket?

Just to make sure I understand right: I can't use the loss against my regular income at all since it's long term and I'll have other gains to offset it? I'm really not sure I understand the repercussions for AGI as I'll be aiming for 74,900 in any case. Correct. If you realize $30K in cap gains, an...
by House Blend
Wed Aug 26, 2015 8:12 pm
Forum: Investing - Help with Personal Investments
Topic: Cost basis for TLH
Replies: 5
Views: 495

Re: Cost basis for TLH

FWIW, I once went through something similar when I changed a fund from FIFO to Specific ID. After the change, the online cost basis info showed the individual lots, but (incorrectly) showed each lot having the same (average) cost. I called about it, and my recollection is that it took about a week o...
by House Blend
Wed Aug 26, 2015 5:04 pm
Forum: Investing - Help with Personal Investments
Topic: Identical fund in two accounts: possible to avoid wash sale rule?
Replies: 14
Views: 1846

Re: Identical fund in two accounts: possible to avoid wash sale rule?

My thought was that, if I could simultaneously exchange all at once (dubious), then I might be able to avoid the wash. Seems like the right thing to have done would have been to select a different fund for the Roth 401(k) way back (eg. fund "A", set and forget), then different funds in th...
by House Blend
Wed Aug 26, 2015 3:52 pm
Forum: Investing - Help with Personal Investments
Topic: Is Tax Loss Harvesting Worth It in the 0% Cap Gains Bracket?
Replies: 11
Views: 1097

Re: Is Tax Loss Harvesting Worth It in the 0% Cap Gains Bracket?

Thanks guys. I realize I left off a critical bit of information: I'd be loss harvesting out of low ER index funds and gain harvesting out of higher ER active management funds. So it would be advantageous to harvest those extra gains to channel back into index funds. But as the active funds have hig...
by House Blend
Wed Aug 26, 2015 2:17 pm
Forum: Investing - Theory, News & General
Topic: [spurned advisor purports there is a Vanguard] Class Action Suit?
Replies: 43
Views: 5313

Re: [spurned advisor purports there is a Vanguard] Class Action Suit?

I understand there are even grumblings of a class action suit or suits in the works regarding this. I am amazed that no one has mentioned this very long thread here on BH that talks about an actual lawsuit against Vanguard, not the mere grumblings of one: https://www.bogleheads.org/forum/viewtopic....
by House Blend
Wed Aug 26, 2015 10:41 am
Forum: Investing - Help with Personal Investments
Topic: Tax loss harvesting question
Replies: 4
Views: 420

Re: Tax loss harvesting question

Selling now will not create a wash, given the facts you presented (and assuming no pertinent facts have been left out). However, future actions can create a wash, and/or increase your tax costs. In particular, there will be a dividend for VTIAX around 9/21 or so. If that dividend is reinvested in th...
by House Blend
Wed Aug 26, 2015 10:28 am
Forum: Investing - Help with Personal Investments
Topic: Avoiding wash sale when reinvesting dividends in IRA
Replies: 16
Views: 1328

Re: Avoiding wash sale when reinvesting dividends in IRA

An alternate tactic I used once, was to also exchange shares purchased with the dividend in the IRA. The shares sold are not tracked my account, but I specified shares in my financial software. Probably have to watch IRS rules on pairing shares for wash sales. I don't know if that will hold with th...
by House Blend
Tue Aug 25, 2015 5:06 pm
Forum: Personal Finance (Not Investing)
Topic: Delayed IRS Refund, Interest Rate & Tax Treatment
Replies: 2
Views: 275

Re: Delayed IRS Refund, Interest Rate & Tax Treatment

Interest on a delayed tax refund is taxed like ordinary interest.
Report it on line 8a (and Schedule B, if you have to file Sched B).

In Publication 17, the IRS wrote:Interest on tax refunds. Interest you receive on tax refunds is taxable income.
by House Blend
Tue Aug 25, 2015 1:37 pm
Forum: Investing - Help with Personal Investments
Topic: Avoiding wash sale when reinvesting dividends in IRA
Replies: 16
Views: 1328

Re: Avoiding wash sale when reinvesting dividends in IRA

Do I wait to see how the brokerage (VG) reports it to decide which bucket I am in? No need to wait. I can tell you what will happen since I've done it before: it won't be marked as a wash sale on your Vanguard 1099-B. And all expert opinions I have seen agree that it is not a wash sale. And keep in...
by House Blend
Tue Aug 25, 2015 10:44 am
Forum: Investing - Help with Personal Investments
Topic: TLH international when already holding VTIAX and VFWAX
Replies: 6
Views: 514

Re: TLH international when already holding VTIAX and VFWAX

Huh? Harvesting from VFWAX to VTIAX should be trouble free.

Are you thinking ahead to a return trip from VTIAX to VFWAX?
That's where your holdings in tax-advantaged could be an issue.
by House Blend
Tue Aug 25, 2015 10:33 am
Forum: Investing - Help with Personal Investments
Topic: New investor confused by TLH
Replies: 2
Views: 430

Re: New investor confused by TLH

With the recent downswing, I am thinking about tax loss harvesting for the first time and want to make sure this is the right process. I have VTSAX in a taxable account. 1. Exchange shares of VTSAX for shares of VLCAX. 2. 31+ days later, exchange the shares of VLCAX back into VTSAX. Does that look ...
by House Blend
Tue Aug 25, 2015 10:03 am
Forum: Investing - Help with Personal Investments
Topic: Tax-loss harvesting and partial wash sale
Replies: 19
Views: 4457

Re: Tax-loss harvesting and partial wash sale

You do need to sell the shares purchased August 20th or you will have a [partial] wash sale. How problematic is a partial wash sale? From what I've read, it seems like it could risk the entire loss being deemed a wash sale. Maybe you need to find better reading materials. ;-) If it's a partial wash...
by House Blend
Tue Aug 25, 2015 9:26 am
Forum: Personal Finance (Not Investing)
Topic: Janus Bond Fund down almost 3% yesterday
Replies: 13
Views: 1852

Re: Janus Bond Fund down almost 3% yesterday

"When the tide goes out you find out who's been swimming naked."
by House Blend
Mon Aug 24, 2015 8:04 pm
Forum: Investing - Help with Personal Investments
Topic: Avoiding wash sale when reinvesting dividends in IRA
Replies: 16
Views: 1328

Re: Avoiding wash sale when reinvesting dividends in IRA

House blend, your answer surprises me, though. Because I thought a wash sale exists when a security is sold and some amount of the the identical security is purchased in the time period from 30 days before the sell date to 30 days after the sell date. Is this not true? Yes, but the wash sale evapor...
by House Blend
Mon Aug 24, 2015 4:56 pm
Forum: Investing - Help with Personal Investments
Topic: Avoiding wash sale when reinvesting dividends in IRA
Replies: 16
Views: 1328

Re: Avoiding wash sale when reinvesting dividends in IRA

Just double checking something: Let's say I sell 101 share of a security today for a loss, and 1 share of it was a reinvested dividend which occurred less than 31 days ago. All of this was for a loss. Is this only loss that is disallowed on the 1 share that was within the 30 day window? I think the...
by House Blend
Mon Aug 24, 2015 4:41 pm
Forum: Investing - Help with Personal Investments
Topic: Another "Is this a wash sale?" with quirks
Replies: 5
Views: 373

Re: Another "Is this a wash sale?" with quirks

What about in this scenario? ⋅ Starting: Account 1 (taxable) holds large quantities of fund X, as does Account 2 (IRA) ⋅ TLH minus 2 weeks: Purchase of new shares in X in Account 2 ⋅ TLH minus 1 week: Exchange of all shares from X to Y in Account 2 ⋅ TLH day:...
by House Blend
Mon Aug 24, 2015 9:00 am
Forum: Investing - Theory, News & General
Topic: TLH Question
Replies: 3
Views: 276

Re: TLH Question

Although it is not necessary to do this exercise, try it: Follow the wash sale rules and add the loss on the earlier lot to the basis of the 2nd lot. Then sell the 2nd lot. See how because of the changed basis of the 2nd lot that the loss comes through anyways and you get the full benefit of the lo...
by House Blend
Mon Aug 24, 2015 8:46 am
Forum: Investing - Theory, News & General
Topic: Is there consensus on reinvesting dividends or taking in cash?
Replies: 8
Views: 931

Re: Is there consensus on reinvesting dividends or taking in cash?

So what is the correct course of action. There is no consensus because there is no single right answer. All you have are pros and cons that individuals should weigh for themselves. In a tax-advantaged account there are few "cons" to automatic reinvesting. The only one I can think of offha...
by House Blend
Sun Aug 23, 2015 9:26 pm
Forum: Investing - Help with Personal Investments
Topic: Wash sale and IRA interaction
Replies: 15
Views: 1145

Re: Wash sale and IRA interaction

That's not the first time this question has been asked on this forum. If you want my answer, it's here: https://www.bogleheads.org/forum/viewtopic.php?p=2597600#p2597600 I read your answer, and agreed for the most part. I still have ambiguous thoughts about this scenario: 1. Purchase shares of Fund...
by House Blend
Sun Aug 23, 2015 8:59 pm
Forum: Investing - Help with Personal Investments
Topic: Need help with understanding if TLH is possible
Replies: 11
Views: 508

Re: Need help with understanding if TLH is possible

I also have VTSAX in my (and my wife's) Roth IRAs - the last purchases was on July 1st. A question you should have asked: 7. Should I stop buying shares of VTSAX in our Roth IRAs? Yes, at least for the next 30 days after you TLH. Otherwise, you will have a (likely small) partial wash sale that you ...
by House Blend
Sun Aug 23, 2015 12:59 pm
Forum: Investing - Help with Personal Investments
Topic: Wash sale and IRA interaction
Replies: 15
Views: 1145

Re: Wash sale and IRA interaction

That's not the first time this question has been asked on this forum.

If you want my answer, it's here:
https://www.bogleheads.org/forum/viewtopic.php?p=2597600#p2597600
by House Blend
Sun Aug 23, 2015 7:56 am
Forum: Investing - Help with Personal Investments
Topic: First Taxable Account
Replies: 8
Views: 924

Re: First Taxable Account

1. What factors should I consider when deciding the cost basis? 2. What factors should I consider when deciding whether to reinvest dividends? At this time, I do not need the quarterly income that the fund will earn. But I heard that reinvesting the dividends in a taxable account is not recommended...

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