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jmacosta writes (inpart):

Then there is no case where you have to pay taxes on an amount of LT or ST capital gains that exceeds your net capital gains.

I reply:

That's not correct. If you're subject to wash sale rules, a capital loss may be deferred to a later tax year (by disallowing your loss and adding it to your basis), thereby exposing more of your capital gains to taxation in the current year.

But absent that issue, it's ultimately your net capital gains for the year that will be subject to taxation in that year, offset by any loss carried over from prior years. --Bob
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