Plan Performance Direct

THE Wealthier + Wiser Blog

Helping you better understand your money so you can reach your goals

Ways to gain money with porfolio losses

When it comes to investing, you want to gain money so naturally you hate when your portfolio loses any money. It is a bummer when it does. It is important to pay attention during an investment year to not ignore any incurring losses. By watching your investments, you can get tax benefits even if it is a loss. It is called tax loss harvesting. It is a smart end of the year financial move that is proactive and can help improve your account. Breaking down a tax loss harvesting account qualifies as an individual account in your name, joint account with your partner or spouse, or a trust account that is taxable. By selling your investments while they are down and reinvesting them you can now offset that loss to other gains in your portfolio or income. The one rule for tax harvesting is known as “wash sale”. The IRS states that if you trade or sell a security at a loss within 30 days before or after this sale and purchase another stock or security that is almost identical it will be disallowed for tax purposes. There are short-term gains/losses which is what you have held for less than a year. Then there are long-term gains/losses that you have held for more than a year. These two gains/losses are the types of capital gains you would deal with when it comes to tax loss harvesting. Over time, you will accumulate losses, but you can stay invested in the market and still perform well. Everyone has their own tax situation and finding what works best. Stay proactive with your investments and over time you hopefully can reduce your tax liabilities and add money to your pocket.

Read more here. Article-Tax-Loss-Harvesting_Carlin-Nov-2016