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Considerations
The tax-smart trading tools in GainsAdvisor can be used to minimize taxes and maximize after-tax returns.
Year End Optimization
The IRS permits you to write-off a maximum of $3,000 in losses each year. Excess losses must be carried over to later years. With the Tax Optimizer tool, you can first enter your carryover losses to determine the impact to your gain/loss. GainsAdvisor will then identify your maximum potential for savings from selling off losses, and point you to the specific lots.
Year Round Strategies
Short Term Movers - Long term positions (those held for more than 365 days) are taxed at a lower rate than short term positions, which are taxed as ordinary income. For this reason, it is more advantageous to sell your losses while they are still short term, and hold onto your gains until they become long term. GainsAdvisor alerts you to positions in your accounts that are approaching long term status, displaying market value and current gain/loss against that value.
Wash Sale Warning - Wash sales occur when shares are sold at a loss and substantially similar shares are purchased within 30 days (before or after) of the sale. Wash sales cause your losses to be deferred until the "replacement shares" purchased are sold. GainsAdvisor identifies those positions in your account that would trigger a wash sale if traded on the current day, helping you avoid those trades.
Double Down - With the Double Down strategy, you take positions that are currently in a deep losing state, and double your holding in them. You then wait 31 days to make sure you are outside of the wash sale window, and sell those shares at a loss. This allows you to recognize losses for tax purposes without losing your stake in the position. GainsAdvisor will alert you to positions in your account that are good candidates for the Double Down strategy.
Example
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