Please help with first TLH [Tax Loss Harvesting]

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Topic Author
Cramerica
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Please help with first TLH [Tax Loss Harvesting]

Post by Cramerica »

So my main concern is that I buy stock on a weekly basis in my taxable account.

In order for me to TLH, do I need to suspend purchases for 30 days in order to sell and avoid a wash?

My workaround would be that I buy into the new fund during this 30 day period so as to avoid the wash sale yet still continue buying into a down market. Is this what people do who buy on a daily/weekly basis in their taxable account?
livesoft
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Re: Please help with first TLH

Post by livesoft »

If the number of shares that you buy weekly in the next 30 days after you sell is a relatively small fraction of the number that you sell, then I would just report the wash sale and adjust the cost basis of those shares as required by the IRS. I wouldn't worry about creating a wash sale.

But you could also not buy the same thing nor anything substantially identical for the next 30 days, too.

And don't forget to sell the shares bought in the past 30 days, too.
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Cramerica
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Re: Please help with first TLH

Post by Cramerica »

Does the order matter?

As in do I need to sell everything bought over the last 30 days before placing the order to sell the specific lot with the most loss that really I want to TLH?
livesoft
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Re: Please help with first TLH

Post by livesoft »

As to the final outcome, the order won't matter. I don't understand why you were even thinking of not selling ALL your losing positions which would include the December purchases, too.

But depending on your broker, the order may create a wash sale that disallows a loss temporarily, then undoes the disallowance on the next order which could be a few milliseconds later. That would not be a problem for me at all, but some people have posted anguished questions about that.
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Cramerica
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Re: Please help with first TLH

Post by Cramerica »

You're right. I will just sell them all. I wanted to do it with the least amount of transactions but it occurs to me that there's no real benefit to that. In fact, I can simplify by selling everything dating back to 12/16/2016!

By the way, my broker is Fidelity.
Topic Author
Cramerica
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Re: Please help with first TLH

Post by Cramerica »

Now that I think about it, I may just sell all shares in my taxable account, since I started buying in taxable 6/27/2016.

I only have 6 lots with a gain. All of these long term gains only add up to a few hundred dollars. Meanwhile, the losses add up to many thousands of dollars.

So should I just sell everything for simplicity?
livesoft
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Re: Please help with first TLH

Post by livesoft »

Sounds good to me.
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Re: Please help with first TLH [Tax Loss Harvesting]

Post by LadyGeek »

This thread is now in the Personal Finance (Not Investing) forum (taxes).

The wiki has some background info: Tax loss harvesting
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PhysicianOnFIRE
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Re: Please help with first TLH

Post by PhysicianOnFIRE »

Cramerica wrote: Tue Dec 25, 2018 12:22 pm Now that I think about it, I may just sell all shares in my taxable account, since I started buying in taxable 6/27/2016.

I only have 6 lots with a gain. All of these long term gains only add up to a few hundred dollars. Meanwhile, the losses add up to many thousands of dollars.

So should I just sell everything for simplicity?
Sounds like a good opportunity to simplify, but there's nothing wrong with keeping the green ones (those with long-term gains) and it's very easy to do so with your cost basis set to Specific ID.

:beer
-PoF
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