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Learning, Sharing, and Teaching => Taxes => Topic started by: Randall Stephens on October 11, 2018, 07:04:48 AM

Title: If I try to TLH, can I do it with this situation?
Post by: Randall Stephens on October 11, 2018, 07:04:48 AM

Making my first attempt at my own Tax Loss Harvesting

Have about a $2000 loss in my taxable account (VTIAX), but realized I bought about $100 of the same fund with dividend reinvestments at the beginning of last week in my IRA.

Is this as easy as reporting a loss of $1900 after the transaction to sell (transfer into a different fund) is complete, or am I missing something?

Let me know if more details are needed ...

Title: Re: If I try to TLH, can I do it with this situation?
Post by: MustacheAndaHalf on October 13, 2018, 08:28:36 AM

Wash sales cancel out an equal number of shares.  You didn't say how many shares you have in taxable, that have a -$2,000 loss.  But if you bought 4 shares in your IRA, you'd use all but 4 shares of VTIAX in taxable to calculate your losses. 

Normally you'd add the value of the wash sale to the "cost basis" of the new shares.  What kind of IRA is involved?  Since Roth IRAs never get taxed again, I think any increase in cost basis has no effect.  But you might have a future benefit if a Traditional IRA is involved.