Taxes

[boneil]

Any ideas on the best way to offset cap gains taxes? They hurt this year. I know, a good problem to have. In the previous years we always had her schooling to help with taxes. We usually get a little back in Federal and pay a little in State taxes. This year, she wasn't in school, she got a big raise, and I actually had capital gains. For this coming year, she already has gotten a big promotion which means a large pay increase. And I'm already starting to realize some gains. If we do nothing, next tax season is going to be

I was thinking maybe doing a "yolo" trade at the end of the year. Either I have bigger gains to pay taxes or a loss to offset the gains

[IMhooked]

I wouldn't let the tax tail wag the investment and earnings dog. Simple answer would be CONGRATS and pay Uncle Sam.
Further advice would be: Do your best to max out all tax advantaged accounts--401ks (or equivalents)?. Do you both utilize traditional IRAs-depending on your household income or do you execute backdoor Roths--not that Roths will save you on taxes but the tax free growth over time in Roth IRAs are a powerful tool especially if you assume taxes will only increase over time. Do you guys utilize/qualify for a Health Savings account with a high deductible health plan? Do you have children, could consider 529 plans (I don't use them with my kids, but they offset earned income).

I would consider the above before taking on risk/aka yolo in my investment plan. Moving forward, with her promotion and career taking off maybe consider becoming a 'boring' buy and hold investor and avoid short term capital gains. Just have to hold out for 13 months before realizing gains ;)

[NitroZ7]

For stocks I want to keep I have sold them and bought them back after thirty days to book the loss or bought another equal position and sold the part with the loss if I am worried about it moving up.

[digthemup]

Any ideas on the best way to offset cap gains taxes? They hurt this year. I know, a good problem to have. In the previous years we always had her schooling to help with taxes. We usually get a little back in Federal and pay a little in State taxes. This year, she wasn't in school, she got a big raise, and I actually had capital gains. For this coming year, she already has gotten a big promotion which means a large pay increase. And I'm already starting to realize some gains. If we do nothing, next tax season is going to be

I was thinking maybe doing a "yolo" trade at the end of the year. Either I have bigger gains to pay taxes or a loss to offset the gains

You can always start a business as LLC that could be treated as DBA, hence you can deduct the losses. Example, bass fishing guide business would allow you to deduct your rig, tackle, and any other expenses you may incur, or your cottage as a rental. I am sure you can come up with more ideas.

BTW, I never worry about making money in my investments cause of taxes, just make enough to make it worth it.

[grandbassslayer]

I wouldn't let the tax tail wag the investment and earnings dog. Simple answer would be CONGRATS and pay Uncle Sam.
Further advice would be: Do your best to max out all tax advantaged accounts--401ks (or equivalents)?. Do you both utilize traditional IRAs-depending on your household income or do you execute backdoor Roths--not that Roths will save you on taxes but the tax free growth over time in Roth IRAs are a powerful tool especially if you assume taxes will only increase over time. Do you guys utilize/qualify for a Health Savings account with a high deductible health plan? Do you have children, could consider 529 plans (I don't use them with my kids, but they offset earned income).


I would consider the above before taking on risk/aka yolo in my investment plan. Moving forward, with her promotion and career taking off maybe consider becoming a 'boring' buy and hold investor and avoid short term capital gains. Just have to hold out for 13 months before realizing gains ;)

Excellent advice!!!