Current Events > Selling stocks at a loss.

(+) Yeah! (+)

So I'm a noob when it comes to stocks and especially taxes surrounding it.

Say I wanted to just accept the fact I'm at a loss in a stock. On this note, I sell the stock and repurchase the same stock at its new lower value.

How does this affect my taxes?

You can write $2,000 off a year, so as long as you don't lose your shirt you will be fine

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It doesnt. You only pay taxes on gains.


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You have a wash sale and cannot utilize that loss because you bought the same or similar stock within 30 days.

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@SK8T3R215

You have a wash sale and cannot utilize that loss because you bought the same or similar stock within 30 days.

Overall I'm up about 700....but going by just the year 2021 I'm down $200

Seriously contemplating accepting I loss that money, selling the stock, then repurchase it at its lower cost.

Only fear I have is how it affects my taxes. If it helps or matters, I have about 3.5k invested into stocks.

You can deduct losses up to a certain point.

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asdf8562 posted...

@SK8T3R215
Overall I'm up about 700....but going by just the year 2021 I'm down $200

Seriously contemplating accepting I loss that money, selling the stock, then repurchase it at its lower cost.

Only fear I have is how it affects my taxes. If it helps or matters, I have about 3.5k invested into stocks.

He answered your question. If you buy back within 30 days, you have to carry over your original basis and disregard the fact that you bought back in at a lower price. You can't take a loss.

If you wait more than 30 days, and it's a stock you held for more than 1 year, you can take up to $3,000 in losses per year. Anything extra is carried over. You can also offset capital losses against capital gain.

What's your purpose for selling and buying back in?

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shockthemonkey posted...

Like selling it at a loss and then waiting for it to go down more before buying it again?

Ya, basically this.
Market has been on a down trend for most of my portfolio for a good 2 weeks.

Tempted to sell, then immediately buy it back.

I'm definitely not calling what I'm proposing smart by no means. More just to make myself feel better seeing a smaller average. How it would affect my taxes is what I do fear though.

You are not going to get to deduct the losses look up wash sale rules.

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If you follow the rules, you can use your losses as a tax deduction. There is a minimum amount of time you need to wait before purchasing the stock again, though. The rules for short and long term investments are also different iirc.

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EndOfDiscOne posted...

He answered your question. If you buy back within 30 days, you have to carry over your original basis and disregard the fact that you bought back in at a lower price. You can't take a loss.

If you wait more than 30 days, and it's a stock you held for more than 1 year, you can take up to $3,000 in losses per year. Anything extra is carried over. You can also offset capital losses against capital gain.

What's your purpose for selling and buying back in?

No good reason honestly.

Seeing the stock tanking has me bummed lol. I know what I'm asking isn't a bright idea.

Kinda mulling over just how stupid it would have been on my taxes for me to go through with it. =/

It's not going to affect your taxes due in a month if that's what you're getting at. This is a long game.

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If you're trying to flip your money around quick, you can lose big. But if you're patient (willing to wait weeks months or longer) the price will almost always come back into your favor at some point or another.

Sounds like the stock market isn't for you, or you need to learn some hard lessons before you can git gud. Buy stocks that you believe in for the long term. Be prepared to watch them dip and ride it out. Don't day trade because it's a zero sum game and there are people who are better at it than you are.

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Stop loss is good sometimes. If you see a stock plummeting and toy really fell it will bottom out, and you have an opportunity to sell at minimal loss it's good to go for it

If you've already lost a lot then might be better to just keep it. Especially if you can afford to take the loss

If you know the stock will keep going down, quickly dump it then short it and make a couple bucks.

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