I've taken a loss in my international stock ETF, SCHF, about 8k down over the last couple of months.
I've been transitioning toward a passive index portfolio and I'm good with the stay the course philosophy ... but:
My wife and I are exposed to a lot of taxes in 2014 and already this year I've incurred some LT capital gains trying to make this transition from individual stocks to index funds.
What I'm asking about is the wisdom of harvesting some tax losses and then move into another international fund/etf, use my IRA for international exposure, or wait a month.
It seems on the face of it like a good way to save some tax dollars.
Advice on Tax Sale ETF
Re: Advice on Tax Sale ETF
I like the idea of selling SCHF in a taxable account for the loss and buying something not substantially identical right away.
It probably does not matter much whether you buy in taxable or tax-advantaged, but if you have no other use for the money, I would just re-commit it to the market right away, so buying something like VXUS or VEU in taxable would be fine. If what you buy drops in value, then do the same thing.
It probably does not matter much whether you buy in taxable or tax-advantaged, but if you have no other use for the money, I would just re-commit it to the market right away, so buying something like VXUS or VEU in taxable would be fine. If what you buy drops in value, then do the same thing.
Re: Advice on Tax Sale ETF
Just make sure to wait 30 days or the wash sale rule will catch up with you.
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Re: Advice on Tax Sale ETF
You mean if he wants to buy back schfFNK wrote:Just make sure to wait 30 days or the wash sale rule will catch up with you.
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Re: Advice on Tax Sale ETF
What kind of capital gains because if long-term then I wouldn't try to realize any losses now.
Re: Advice on Tax Sale ETF
While it is true that the harvested losses will offset long-term gains, and it is better to use them against short-term gains or ordinary income, I would still recommend taking the losses now. Since SCHF is down only 4% from its peak, there is a substantial chance that there won't be any losses by January 2015, and thus no tax to save at all if you wait. (Meanwhile, if the market drops, you can harvest your replacement fund just as well, so you will still get the benefit of larger losses.)placeholder wrote:What kind of capital gains because if long-term then I wouldn't try to realize any losses now.