Best Tax Preparation Services in Norwalk, CA

As year-end approaches, you may want to make some moves to make the best tax use of paper losses and actual losses from your stock market investments. For example, have you realized gains earlier in 2022 from sales of stock held for more than one year (long-term capital gains) or from sales of stock held for one year or less (short-term capital gains)? Take a close look at your portfolio and consider selling some losers — those shares that now show a paper loss. Sell enough losers to generate losses to offset your earlier gains plus an additional $3,000 loss. Selling to produce this loss is a tax-smart idea because a $3,000 loss can offset the same amount of ordinary income each year.