02-24-2022, 04:29 PM
What's the risk of selling stock losses when you can tax loss harvest?
<!-- SC_OFF --><div class="md"><p>Genuine question here, I'm trying to wrap my head around this.</p> <p>I have some stock I bought last year that are doing pretty poorly right now; let's use Palintir (PLTR) as an example.</p> <p>I bought PLTR at $28. It's currently around $10.</p> <hr/> <p><strong>If I sell PLTR</strong>:</p> <ul> <li><p>Benefit: I tax loss harvest. I haven't technically lost money on my investment because I can roll over losses indefinitely </p></li> <li><p>The only cost is opportunity cost of future gains (either in PLTR or other stock)</p></li> </ul> <hr/> <p><strong>If I buy $10 PTLR shares now and sell $28 PLTR shares 31 days later</strong>: </p> <ul> <li><p>If PLTR is over $28, I make money.</p></li> <li><p>If PLTR is under $28, I TLH while reducing my PLTR cost basis to $10</p></li> </ul> <hr/> <p><strong>Questions</strong>:</p> <ul> <li><p>If I can indefinitely TLH my losses forward, doesn't that mean I never really lose money even when I sell at a loss?</p></li> <li><p>Can I only carry losses forward after I've owned shares for over a year?</p></li> </ul> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/productivemodego"> /u/productivemodego </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/szkz9l/whats_the_risk_of_selling_stock_losses_when_you/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/szkz9l/whats_the_risk_of_selling_stock_losses_when_you/">[comments]</a></span>Kind Regards R
<!-- SC_OFF --><div class="md"><p>Genuine question here, I'm trying to wrap my head around this.</p> <p>I have some stock I bought last year that are doing pretty poorly right now; let's use Palintir (PLTR) as an example.</p> <p>I bought PLTR at $28. It's currently around $10.</p> <hr/> <p><strong>If I sell PLTR</strong>:</p> <ul> <li><p>Benefit: I tax loss harvest. I haven't technically lost money on my investment because I can roll over losses indefinitely </p></li> <li><p>The only cost is opportunity cost of future gains (either in PLTR or other stock)</p></li> </ul> <hr/> <p><strong>If I buy $10 PTLR shares now and sell $28 PLTR shares 31 days later</strong>: </p> <ul> <li><p>If PLTR is over $28, I make money.</p></li> <li><p>If PLTR is under $28, I TLH while reducing my PLTR cost basis to $10</p></li> </ul> <hr/> <p><strong>Questions</strong>:</p> <ul> <li><p>If I can indefinitely TLH my losses forward, doesn't that mean I never really lose money even when I sell at a loss?</p></li> <li><p>Can I only carry losses forward after I've owned shares for over a year?</p></li> </ul> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/productivemodego"> /u/productivemodego </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/szkz9l/whats_the_risk_of_selling_stock_losses_when_you/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/szkz9l/whats_the_risk_of_selling_stock_losses_when_you/">[comments]</a></span>Kind Regards R