{
  "slug": "tax-loss-harvesting",
  "name": "Tax-loss harvesting",
  "aliases": [
    "TLH",
    "harvest losses",
    "tax loss harvest",
    "direct indexing harvest"
  ],
  "family": "accounts",
  "heat": "high",
  "talk": "Lots of talk",
  "mostDiscussed": false,
  "firstLine": "Tax-loss harvesting means selling an investment at a loss in a taxable account so the realized loss can be used under tax rules. A market decline that has not been sold is not the same thing.",
  "whyLine": "The practical work is tracking tax lots, replacement purchases and automatic reinvestments; a small overlooked purchase can complicate a much larger loss sale.",
  "feelWords": [
    "tax loss harvest",
    "wash sale",
    "tlh",
    "direct indexing"
  ],
  "commonPicture": [
    {
      "lead": "Wash-sale window: 30 days before through 30 days after",
      "why": "Substantially identical purchases can disallow a loss; a different fund name alone does not settle the question. [community]"
    },
    {
      "lead": "Automatic purchases still count",
      "why": "Dividend reinvestment and relevant purchases in other accounts can affect the transaction history. [community]"
    },
    {
      "lead": "Losses first offset capital gains",
      "why": "Remaining net losses can offset up to $3,000 of other income, or $1,500 married filing separately, with carryforward rules. [community]"
    }
  ],
  "watchFor": "Wash sales. Harvesting inside an IRA. This is not tax advice. Rules move.",
  "whatPeopleSay": [
    "**The job:** realize a capital loss in a taxable account, then track how that loss is treated. Every purchase already creates a tax lot; harvesting creates a realized gain or loss event. [community]",
    "**r/personalfinance, Bogleheads, and 2026 tax-bill explainers** keep the phrase loud. [community]",
    "**Managing many small sales:** paid harvesting services add their own cost and transaction records. More loss-sale activity does not remove the wash-sale or reporting rules. [community]",
    "**The transaction history matters:** the sale, replacement purchases and relevant other accounts need to be reconciled. Tax software or a professional still needs accurate records. This is not tax advice. [community]"
  ],
  "howPeopleRunIt": [
    "**Only taxable.** [community]",
    "**Review the loss sale and replacement purchases together.** Wash-sale rules consider substantially identical securities bought within 30 days before or after the sale. A different fund name alone is not a safe-harbor test. [community]",
    "**They do not harvest a loss they need for a specific share they must repurchase tomorrow.** [community]"
  ],
  "amountsPeopleUse": [
    "**Loss use:** offset capital gains first; then up to **$3,000** of remaining net loss against other income (**$1,500** if married filing separately). Unused losses carry forward. [community]",
    "**Wash-sale window:** **30 days before and 30 days after** the loss sale, including the sale date. [community]"
  ],
  "howPeopleKeepIt": [
    "**A spreadsheet of lots.** [community]"
  ],
  "howItFeels": [
    "**A paperwork win, not a dopamine trade.** [community]"
  ],
  "howLongPeopleRunIt": [
    "**Whenever a lot is down enough to bother,** especially late year. [community]"
  ],
  "deepDive": [
    "**Why the taxable account matters:** the strategy uses a realized investment loss under taxable-account rules. A decline inside an IRA does not create the same personal capital-loss deduction. [community]",
    "**Different from a Roth conversion:** harvesting concerns realized investment gains and losses. A conversion concerns moving eligible retirement assets to Roth and possible income in that year. They can both affect tax planning without being interchangeable. [community]"
  ],
  "watchForLong": [
    "**Wash sales.** [community]",
    "**A tax-law headline is not the transaction rule:** verify the applicable loss and wash-sale treatment instead of assuming a recent law changed every investment-tax calculation. [community]"
  ],
  "related": [
    "taxable-brokerage",
    "roth-conversions",
    "three-fund",
    "fire-number"
  ],
  "researchPointer": [],
  "housePointers": [],
  "playPointer": null,
  "sources": [
    "r/personalfinance TLH threads",
    "Bogleheads wash-sale talk",
    "2026 tax-bill harvesting explainers"
  ],
  "disclaimer": "Community talk may be wrong. Not financial, tax, legal, or investment advice. No return or outcome is promised.",
  "quickAnswerHistory": [
    {
      "field": "commonPicture",
      "rows": [
        {
          "lead": "Wash-sale clock",
          "why": "Substantially identical + 30 days is the forum chant. [community]"
        }
      ]
    },
    {
      "field": "amountsPeopleUse",
      "rows": [
        "**$3,000** net ordinary-income offset is the US number people chant — plus unused losses carrying forward. Confirm the current year. [community]",
        "**30-day** wash-sale window in the same chant. [community]"
      ]
    },
    {
      "field": "definition",
      "rows": [
        "Tax-loss harvesting is selling a down lot in a taxable account to bank a capital loss while staying invested."
      ]
    },
    {
      "field": "communityPicture",
      "rows": [
        "People replace the sold fund with a neighbor, watch wash-sale windows, and treat year-end as the scramble season. It is not tax advice."
      ]
    },
    {
      "field": "whatPeopleSay",
      "rows": [
        "**The job:** turn a taxable loss into a tax lot while staying in the market. [community]",
        "**Direct indexing** is the paid version of lots of tiny harvests. [community]",
        "**Not advice.** Wash-sale and the current year’s law are a person and a tax person. [community]"
      ]
    },
    {
      "field": "howPeopleRunIt",
      "rows": [
        "**Sell the loser, buy a neighbor fund, calendar the 30 days.** [community]"
      ]
    },
    {
      "field": "firstLine",
      "rows": [
        "Tax-loss harvesting is selling a loser in taxable to bank a capital loss — then staying invested without breaking wash-sale rules."
      ]
    },
    {
      "field": "whyLine",
      "rows": [
        "Tax-loss harvesting is selling a loser in taxable to bank a capital loss — then staying invested without breaking wash-sale rules."
      ]
    },
    {
      "field": "commonPicture",
      "rows": [
        {
          "lead": "Taxable account only",
          "why": "IRA/401k harvesting is a different, usually wrong, idea. [community]"
        },
        {
          "lead": "Stay invested",
          "why": "They replace the sold fund, not go to cash as a personality. [community]"
        },
        {
          "lead": "Wash-sale window: 30 days before through 30 days after the sale",
          "why": "Buying substantially identical securities within this window can disallow the loss. [community]"
        },
        {
          "lead": "Year-end scramble",
          "why": "November–December posts spike. [community]"
        },
        {
          "lead": "Losses first offset capital gains",
          "why": "Remaining net losses can offset up to $3,000 of other income per year, or $1,500 if married filing separately; unused losses carry forward. [community]"
        }
      ]
    },
    {
      "field": "deepDive",
      "rows": [
        "**Taxable brokerage** is the account. [community]",
        "**Roth conversions** are a different tax-year tool. [community]"
      ]
    },
    {
      "field": "watchForLong",
      "rows": [
        "**Treating a YouTube ‘OBBBA changed everything’ short as the code.** [community]"
      ]
    }
  ]
}