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Subject:  Re: Tax-loss harvesting for a 0.35% annual fee? Date:  10/29/2013  4:02 PM
Author:  ptheland Number:  73668 of 88766

Really? I thought tax-loss harvesting was the kind of run-of-the-mill blocking and tackling that any competent investor does.

Perhaps I see the issue differently as a working tax professional.

From my point of view, tax loss harvesting simply cannot stand by itself. Instead, considerations of selling an investment to recognize a loss is part of your overall annual tax planning.

You can't just look at an investment portfolio and decide if selling for a loss is a good idea or not without looking at the entire tax picture - other sources of income and deduction, projections into the next year and sometimes the next few years, the capital gains and losses which have already been recognized for the year.

And you can't forget the investment considerations. Some investments are more speculative than others, or have lumpy returns. Staying out of an investment for the 30 days necessary to avoid wash sale treatment might cost more in foregone investment returns than it saves in taxes. Doubling up on an investment for 30 days (again to avoid wash sale treatment), can have the same effect in a falling market.

I just don't see how all of this can be rolled up into some simple formulaic approach to tax loss harvesting. It is by nature quite complex with many variables and estimates to consider.

I do agree with you that considering taxes is one of the basics of investing.

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