• Skip to primary navigation
  • Skip to content
  • Skip to primary sidebar
  • Skip to footer

Mandeville CPA - CMR Associates, LLC

  • Home
  • Services
    • Tax Accounting
    • Small Business Accounting
    • Business Consulting
    • Business Valuation
    • Notary Services
  • Industries
    • Construction
    • Musicians
    • Real Estate
    • Retail
    • Restaurants and Hospitality
  • About Us
  • Book Appointment

Tax Accounting and Business Consulting for Mandeville, Louisiana

Investors: Beware of the wash sale rule

Mandeville La Certified Public Accountant Tax Accountant wash sale rules

Investors: Beware of the wash sale rule

A tried-and-true tax-saving strategy for investors is to sell assets at a loss to offset gains that have been realized during the year. So if you’ve cashed in some big gains this year, consider looking for unrealized losses in your portfolio and selling those investments before year end to offset your gains. This can reduce your 2017 tax liability.

But what if you expect an investment that would produce a loss if sold now to not only recover but thrive in the future? Or perhaps you simply want to minimize the impact on your asset allocation. You might think you can simply sell the investment at a loss and then immediately buy it back. Not so fast: You need to beware of the wash sale rule.

The rule up close

The wash sale rule prevents you from taking a loss on a security if you buy a substantially identical security (or an option to buy such a security) within 30 days before or after you sell the security that created the loss. You can recognize the loss only when you sell the replacement security.

Keep in mind that the rule applies even if you repurchase the security in a tax-advantaged retirement account, such as a traditional or Roth IRA.

Achieving your goals

Fortunately, there are ways to avoid the wash sale rule and still achieve your goals:

  • Sell the security and immediately buy shares of a security of a different company in the same industry or shares in a mutual fund that holds securities much like the ones you sold.
  • Sell the security and wait 31 days to repurchase the same security.
  • Before selling the security, purchase additional shares of that security equal to the number you want to sell at a loss. Then wait 31 days to sell the original portion.

If you have a bond that would generate a loss if sold, you can do a bond swap, where you sell a bond, take a loss and then immediately buy another bond of similar quality and duration from a different issuer. Generally, the wash sale rule doesn’t apply because the bonds aren’t considered substantially identical. Thus, you can achieve a tax loss with virtually no change in economic position.

For more ideas on saving taxes on your investments, please contact us.

Tax Accounting, Tax Preparation, and Business Consulting for Metairie, Louisiana
Industry Specific Accounting
Metairie CPA Services
Metairie CPA News

Tax Accounting, Tax Preparation, and Business Consulting for Mandeville, Louisiana
Industry Specific Accounting
Mandeville CPA Services
Mandeville CPA News

Tax Accounting, Tax Preparation, and Business Consulting for Baton Rouge, Louisiana
Industry Specific Accounting
Baton Rouge CPA Services
Baton Rouge CPA News

Tax Accounting, Tax Preparation, and Business Consulting for Covington, Louisiana
Industry Specific Accounting
Covington CPA Services
Covington CPA News

Mandeville Notary Public Services
Madisonville Notary Public Services
Covington Notary Public Services

Filed Under: Individual Tax Advice

Primary Sidebar

About Us

Mandeville CPA Tax Accounting Business

Tax Accounting and Business Consulting for Mandeville, Louisiana We specialize in tax accounting,

Business Consulting

Mandeville CPA Business Consulting

Business Consulting for Mandeville, Louisiana: New Business Venture Start-Up – We file all

Tax News and Advice

  • Individual Tax Advice
  • Small Business Tax Advice

Footer

Company Profile

Charles Renwick, CPA has provided clients big and small quality accounting, tax, and business consulting services for over 15 years. We have all the resources needed to meet your business and personal accounting needs.

Offices in Madisonville, Mandeville, Metairie, and Baton Rouge.

Accounting News and Updates

  • 2 ACA taxes that may apply to your exec comp
  • Which tax-advantaged health account should be part of your benefits package?
  • Accelerate your retirement savings with a cash balance plan
  • “Bunching” medical expenses will be a tax-smart strategy for many in 2017
  • Timing strategies could become more powerful in 2017, depending on what happens with tax reform
  • Investors: Beware of the wash sale rule
  • 2 ways spouse-owned businesses can reduce their self-employment tax bill
  • Why you should boost your 401(k) contribution rate between now and year end

Book an appointment with Personnel Calendar using SetMore

Write or Call Today

CMR Associates, LLC
1070 West Causeway Approach
Suite B
Mandeville, LA 70471
(888) 530-5630
office@cmrtax.com

© 2023 · Web Design by Link+Like ·