capital loss carry over?

Question

I have a capital loss carry over of 20K. Would it be in my best interest to sell some mutual funds and realize a capital gain and try to offset this carryover? It seems like in some way it's advantageous to get it off the books ASAP.. sort of like I"m giving the Gov a loan.. but perhaps it's really a wash

Answer 1

Your capital loss carryover is a tax asset. Use it wisely. Selling the mutual funds will have some transaction costs in either the sale or in th reinvestment of the proceeds, so dont be too eager to sell just to use the CL. If a sale of the fund(s) would be prudent from an asset allocation standpoint, you have the benefit of the CL to make it a less costly transaction to get your portfolio into proper form.



Any tax advice included in this written or electronic communication was not intended or written to be used, and it cannot be used by the taxpayer, for the purpose of avoiding any penalties that may be imposed on the taxpayer by any governmental taxing authority or agency

Answer 2

I wouldn't dump an appreciating asset just to use up the capital loss. But if I were already selling off something with a gain, I'd dump a loser in a heartbeat to kill off the gain!

Take your $3,000 limit this year and carry the balance forward for when you might actually NEED it to offset the gain when you sell something that you need to because you need the money for something else.

Answer 3

Technically, you're able to do the capital loss carryforward worksheet interior the schedule D training. yet once you extremely in basic terms had $2500 in earnings, you in basic terms used up $2500 of the loss and the the rest volume is carried over to line 6 or line 14.