FAQs

Understand key financial terms with confidence.

Question

What is tax-loss harvesting?

Answer

Tax-loss harvesting is a strategy where you sell investments at a loss to offset capital gains and reduce current-year taxes. Losses can offset up to $3,000 of ordinary income annually for an individual (and $1,500 if you are married and filing separately), with any remainder carrying forward. The wash sale rule disallows the loss if you buy substantially identical securities within 30 days before or after the sale.

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