capital gain strategy (basic query)

Let's suppose I have a net short term loss of $2500 in late 2019.
I also can take a long term capital gain of $2500.
Am I correct that I would be better off taking the gain in 2020.?
The idea is I get the short term loss at my full tax rate and get the
long term gain at a reduced tax rate next year? Or am I missing some
benefit of taking the long term gain in 2019? It seems if I take it in
2019 I lose that reduced tax benefit because it goes against the short
term loss.
Reply to
Your analysis is correct, as far as it goes. But you are (almost) always better off deferring a gain, anyway, even if the rates were the same.
-- Arthur L. Rubin, Brea, CA
Reply to
Arthur Rubin
The one thing you are missing is the effect on some other tax benefit or the effect on some other payment you make or some other benefit you receive that uses your AGI.
E.g., what if you are on Medicare and that extra $2500 capital gain in 2020 pushes your AGI above the IRMAA threshold or into a higher IRMAA threshold. Or, what if that higher AGI pushes you above 400% of the FPL and you have to pay back the full Advanced Premium Tax Credit you received to subsidize the health insurance you bought on one of the health exchanges.
IRMAA = Income Related Monthly Adjustment Amount FPL = Federal Poverty Level
Reply to
Good point, Alan. In fact I am on SS and MediCare, so I will need to make sure my income is below a certain threshold as it could impact my premiums
Reply to

Site Timeline Threads

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.