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Financial Planning / Tax Strategies


Subject:  Re: Capital Gains Question Date:  4/24/2013  12:11 PM
Author:  billjam Number:  118482 of 129670

Difficult to answer without knowing a lot more about your personal situation. In general I'd say go ahead and take gains this year up to the point they are 0% taxed. Remember, however, if you have state income tax they might be taxed as ordinary income depending on your state. It also sounds like you are thinking you need to re-balance due to one stock getting overweighted. That's an investment decision to made even without the tax consideration.

Also, remember you can take the capital gain and immediately buy back any stock you want to continue to hold. Wash sale rules only apply if you are taking a loss.

Double and triple check your estimates so you don't accidentally kick your income beyond the point of 0% cap gains rate, but it sounds like you're thinking along the right lines. Just don't let the tax tail wag the dog when it comes to investment decisions.
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