Switch bond funds later?

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l1am
Posts: 86
Joined: Wed Mar 02, 2016 2:27 pm

Switch bond funds later?

Post by l1am » Wed Sep 12, 2018 12:43 am

Right now I have a high enough marginal fed tax rate to warrant investing in VWIUX in a taxable account.

Suppose in a year or two I moved to a new job with a lower marginal rate, where it would make sense to switch to VBTLX.

Is that something that's possible? I guess I'd just have to pay capital gains if the bond value had increased?

PFInterest
Posts: 2616
Joined: Sun Jan 08, 2017 12:25 pm

Re: Switch bond funds later?

Post by PFInterest » Wed Sep 12, 2018 7:02 am

possible yes, you just sell and pay the taxes or claim the losses.

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grabiner
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Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

Re: Switch bond funds later?

Post by grabiner » Wed Sep 12, 2018 7:36 pm

Yes, you would pay tax on any capital gains if you switch bond funds. However, bond funds don't tend to have much in capital gains, so any tax cost for switching should be very low.
Wiki David Grabiner

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