Investopedia

Continue to Site »

Tax Gain/Loss Harvesting

Filed Under » , ,
Dictionary Says

Definition of 'Tax Gain/Loss Harvesting'

Selling securities at a loss to offset a capital gains tax liability. Tax gain/loss harvesting is typically used to limit the recognition of short-term capital gains, which are normally taxed at higher federal income tax rates than long-term capital gains.

Also known as "tax-loss selling".
Investopedia Says

Investopedia explains 'Tax Gain/Loss Harvesting'

For many investors, tax gain/loss harvesting is the single most important tool for reducing taxes now and in the future. If properly applied, it can save you taxes and help you diversify your portfolio in ways you may not have considered. Although it can't restore your losses, it can certainly soften the blow. For example, a loss in the value of Security A could be sold to offset the increase in value of Security B, thus eliminating the capital gains tax liability of Security B.

Articles Of Interest

  1.

    Tax Tips For The Individual Investor

    We give you seven guidelines to help you keep more of your money in your pocket.

  2. 10 Steps To Tax Preparation

    Follow these simple steps to get you ready for April 15.

  3. Selling Losing Securities For A Tax Advantage

    Tax-loss harvesting can help you to reduce taxes on your portfolio gains, but make sure you know the rules!

  4. Tax-Loss Harvesting: Reduce Investment Losses

    The option to bolster after-tax stock returns through tax-loss harvesting can reverse investor gloom.

  5. The Art Of Cutting Your Losses

    Find out how to keep your capital losses small and let your winners run.

  6. Has Income Tax Become A Class Tax On The Poor?

    With more than 33% of American families falling close to the poverty line despite their adult members holding full-time employment, a rising number of citizens are being forced to pay a rate ...

  7. Possible Effects Of The Online Retail Tax

    The U.S. Senate has passed a bill that will impose a sales tax on online retailers. Discover how the Marketplace Fairness Act could affect your bottom line.

  8. How To Get The Most Out Of Hiring An Accountant

    When you hire an accountant, getting good tax advice going forward is as valuable as – or perhaps even more valuable than - getting the previous year’s taxes filed correctly. Learn what you need ...

  9. How The 2014 Obama Budget Could Affect Your Finances

    Depending on which estimate you believe, Obama's proposed budget would raise the tax bill of a household with a yearly income of $50,000 to $75,000 between $63 and $100 per year. However, that’s ...

  10. Inaccurate Tax Return, Now What?

    If the IRS finds errors, it will cost you. Find out how to fix them, and how to prevent them in the first place.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Fool In The Shower

    The notion that changes or policies designed to alter the course of the economy should be done slowly, rather than all at once.

  2. Pattern Day Trader

    An SEC designation for traders who trade the same security four or more times per day (buys and sells) over a five-day period, and for whom same-day trades make up at least 6% of their activity for that period.

  3. Cost-Push Inflation

    A phenomenon in which the general price levels rise (inflation) due to increases in the cost of wages and raw materials.

  4. Happiness Economics

    The formal academic study of the relationship between individual satisfaction and economic issues, such as employment and wealth.

  5. Affluenza

    A social condition arising from the desire to be more wealthy, successful or to "keep up with the Joneses." Affluenza is symptomatic of a culture that holds up financial success as one of the highest achievements.

  6. Icarus Factor

    The term Icarus factor describes a situation where managers or executives initiate an overly ambitious project which then fails. Fueled by excitement for the project, the executives are unable to reign in their misguided enthusiasm before it is too late to avoid the failure.
Trading Center