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Author: vk2 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Minimizing Capital Gains Taxes Date: 3/13/2006 12:37 PM
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Not sure if this has been discussed yet.

I currently started participating in my company's stock purchase plan, which provides a percentage match for stocks. However, I prefer to sell a certain percentage a quarter, in order to keep my portfolio balanced and as a sort of 'enforced savings plan.'

From my research, this will subject me to short term capital gain taxes, especially in the short term until I hold at least some of the stock for a year. Since this can be upwards of 25%, does anyone have suggestions how I might be able to 'shelter' some of this tax money (and lower my percentage of taxes?) The proceeds of my stock sells will be used to buy shares of different stock.

Thanks in advance,

Vern
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Author: jrr7 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 84922 of 121061
Subject: Re: Minimizing Capital Gains Taxes Date: 3/13/2006 1:16 PM
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The IRS allows you to sell the shares you choose, as long as you instruct your broker. If you instruct your broker to sell the oldest shares (or the shares you purchased more than 365 days ago) you'll owe LTCG tax not STCG tax.

Some brokers make this very easy online; some require that you call them up and use telebroker; some require that you speak to a live person. Ask your broker what the procedure is to specify a specific lot to sell.

Some brokers make it diffic

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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 84926 of 121061
Subject: Re: Minimizing Capital Gains Taxes Date: 3/13/2006 1:38 PM
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From my research, this will subject me to short term capital gain taxes, especially in the short term until I hold at least some of the stock for a year. Since this can be upwards of 25%, does anyone have suggestions how I might be able to 'shelter' some of this tax money (and lower my percentage of taxes?)

Aside from waiting to begin your sales until you have some long-term shares to sell, there isn't any way to avoid the short-term treatment. What you do with the proceeds doesn't affect the taxation of the gain.

Phil

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