Admit it. You still obsess about the stock market.
Paying continual attention to the ups and downs of your stocks will drive you crazy.
But sensibly assessing your portfolio and making appropriate moves now instead of at the end of the year could pay off at tax time.
That's Midyear
Tax Moves tip #5, courtesy of @fcn who, when he's not Tweeting, posts as nickel at fivecentnickel.com.
Nickel's tax move to make now: Do some tax loss harvesting if you have any losing investment positions.
As the name indicates, you'll want to find the holdings that will result in a net loss when you sell them.
Why? If you also have any corresponding capital gains, you can use this crop of losses to offset them.
And if you have more capital losses than gains, you get to use up to $3,000 a year in your losses to reduce your ordinary taxable income.
A lot of people put off making tax moves until December. But if you have a stock that's tanked in value and it no longer fits your overall investing strategy, why keep it?
Sell now and use the proceeds for something else and book the tax loss for when you file your return.
More midyear tax tips on their
way: Thanks to @fcn for the tax loss harvesting advice as part of the inaugural Midyear
Tax Moves.
If you have a
tax move we can make now to help reduce an upcoming 2010 tax bill, we'd love to
hear from you. I'll be posting the tips, one each weekday until we run out.
If you're succinct, I'll take your tip via
Twitter @taxtweet. Got a
bit more to say, post it on the ol' blog's Facebook page.
And if you want a chance to win a New Yorker
desk diary, check out the details here (the entry deadline has been
extended to June 27).
Related
posts:
- Midyear tax tip #1: Welcome summer with energy-related tax
breaks - Midyear tax tip #2: Plan health care account moves
- Midyear tax tip #3: Adjust withholding
- Midyear tax tip #4: Evaluate your estimated tax situation
- Stock options tax tip
- Year-end money moves: Investments
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