Monday, January 29, 2007

Bankrate.com via yahoo Finance: "Don't let your tax break get washed away"

Pretty good review. If you captured some short-term losses last year, but want back in, be a little careful how you do so, as the article discusses. Incidentally, if you are in an advisory relationship, a way you might evaluate the service your advisor is giving you, if you have some money in a taxable account, is does he harvest material short-term losses for you each year when they exist? If not, ask why, and get a good explanation.

Also, does he only think about this subject near the end of the year? You can take short-term losses whenever they come along, unless you are invested in such a way as to preclude your doing so. For example, some otherwise excellent no-load mutual funds have short-term redemption fees. And of course if you've been placed in load funds, where there are sales charges, etc., the whole idea becomes problematical.

ETFs are very usable for tax loss harvesting, and usually there are pretty good choices for replacement holdings to avoid the possibility of a wash sale rule problem


Yahoo! Personal Finance

Labels: ,

0 Comments:

Post a Comment

Links to this post:

Create a Link

<< Home