Over the past 6 months or so, I've been increasing the fixed asset allocation in my portfolio. I've already moved all I can in my IRA, so I've been moving some equities to fixed assets in my taxable account. Bottom line: I've got $95K in losses. If I understand the tax law correctly (and I might not), I can offset any capital gains for the year against the loss. I also can carry forward the balance and offset future realized gains against the balance of the loss, plus I can offset up to $3K of earned income, and I can continue to do this until the loss is exhausted or the law is changed. Am I correct with all of this? Also, what I don't know, is can I offset the loss against dividend income? I assume not, but I thought I would ask. Thanks.
You are correct that the loss carries forward, and can offset future capital gains plus $3000 of ordinary income annually until you have used it all, the law is changed, or you die. You are also correct that you cannot use these losses to offset dividend income. If you are like lots of investors, we will not be paying capital gains tax for a long time. It is no longer important to look for tax-efficient mutual funds!Best wishes, Chris
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