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Financial Planning / Tax Strategies


Subject:  Re: tax penalty on stocks sold in less than a ye Date:  12/31/2008  8:08 PM
Author:  irasmilo Number:  103269 of 124805

It is to the taxpayers advantage when long term losses offset short term gains, but to their disadvantage when long term gains are offset by short term losses.

This statement is half correct. It is not to the taxpayer's advantage (or disadvantage) when long term losses offset short term gains. Long term losses are never any more valuable than short term losses. In fact, you should take your losses before they become long term because once they are long term they must be used against long term gains first. Short term losses are used against long term gains (not good) only when they exceed short term gains.

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