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Financial Planning / Tax Strategies


Subject:  Re: Tax question on Stock options. Date:  2/12/2001  8:41 AM
Author:  mathetes Number:  46229 of 132471

mytaxqa: Why I ask this is because I made a lot of losses on internet related stocks and want to offset my loss with gain from stock options.

I want to just suggest that you examine your premise here. People do routinely try to offset gains by opportunistically selling stocks where they register a loss -- gotta get rid of them sometime, so why not do it to advantage -- but the reverse scenario may be logically equivalent but strikes me as perhaps akin to shooting oneself in the foot.

Unless you are simply satisfied that the positive, winning investment (or option) has done as well as it can so you might as well sell it off, why would you not want to continue holding it for longer term gain? Losses continue to be carried forward. In the meantime, they will reduce your taxable income each year until you totally offset them.

In short, it may make sense to cut your losses; but you seem to be saying, let me cut my gains to take advantage of these losses.

Or am I missing something here?


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