Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
Do you have to pay capital gains taxes on stock you sold where you LOST money?


Bil
Print the post Back To Top
No. of Recommendations: 0
Do you have to pay capital gains taxes on stock you sold where you LOST money?

Nope! But if you have any gains, use the losses to offset them. Any remaining losses (up to $3000) may be deducted from your other income. If the losses exceed $3,000, any amount over that is carried over to next year, or future years, til it is consumed by new gains, time, or your demise.

"Jack"

Print the post Back To Top
No. of Recommendations: 0
I almost want to think there is a trick here, or that I am seriously missing some facts.

If you indeed sold stock for a loss, then you have no income from that sale on which to be taxed, so no taxes will be owed.

BUT, from the question, it sounds like someone has indicated that you would owe taxes. I would be very interested to know more...Thanks for the puzzler.

Just a thought...
Print the post Back To Top
No. of Recommendations: 0
Jack,

Perhaps the rules have changed, but wouldn't the carry forward be available to offset $3,000 per year in ordinary income every year until it was used up? For example, a $9,000 loss would offset $3,000 in OI this year, then $3,000 in OI next year and then $3,000 in the third year (assuming no pleasant new capital gains)?

I could be mistaken, as I haven't looked in a while.

Just a thought...
Print the post Back To Top
No. of Recommendations: 1
<<Perhaps the rules have changed, but wouldn't the carry forward be available to offset $3,000 per year in ordinary income every year until it was used up? For example, a $9,000 loss would offset $3,000 in OI this year, then $3,000 in OI next year and then $3,000 in the third year (assuming no pleasant new capital gains)?>>

After looking at both of the posts in question, it seems that you are both correct...just using different words.

The carryforward of capital losses can be used to offset future capital gains. If you have no "future" capital gains, you'll get the $3k deduction in that future year, and you'll carry over any remaining balance. Which, if I'm reading correctly, is what you are saying above...and also what Jack said (in slightly different words).

The only thing that Jack pointed out that many people are not aware of is that you can't "will" your capital losses to another after you die. They go to the grave with you. So if you have very LARGE capital losses, make sure to see your doctor for a checkup at least once a year. And don't take up skydiving. :-)

TMF Taxes
Roy

Print the post Back To Top
Advertisement