Details matter when selling investments
If you don’t pay attention to the details, the tax consequences of an investment sale may be different from what you expect.
For example, if you bought the same security at different times and prices and want to sell high-tax-basis shares to reduce gain or increase a loss to offset other gains, be sure to specifically identify which block of shares is being sold.
And when it gets close to year-
end, keep in mind that the trade date, not the settlement date, of publicly traded securities determines the year in which you recognize the gain or loss.
Finally, consider the transaction costs, such as broker fees. While of course such costs are not taxes, like taxes they can have a significant impact on your net returns, especially over time, because they also reduce the amount of money you have available to invest.
If you have questions about the potential tax impact of an investment sale you are considering — or all of the details you should keep in mind to minimize it — please contact Whalen.
Copyright 2015 Thomson Reuters