Manipulating Taxes with stock market win/losses

[DesertCat]

Some important issues to consider. If you buy it back tomorrow the transaction won't count for tax purposes. The IRS ignores sale/repurchase of "similar securities" if they take place within 31 days of each other. It's called the "wash sale rule" and you can look it up on the IRS's pretty accessible web site.

Another issue is that you can only write off $3k of capital losses per year against ordinary income. You need other capital gains to save more than that. If you have other short term gains, then harvesting losses will save you the 30%. But if your other capital gains are all long term, then harvesting losses only saves you 15%, the long term rate.

And you are restarting the capital gains clock on your losers, so if you sell them for a profit within 12 months, your move today may have cost you a lower long term capital gains rate next year.