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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Kirk © who wrote (735)	9/5/1998 11:45:00 AM
From: Ken Brown	Read Replies (1) \| Respond to of 15132

Kirk, regarding your tax loss selling strategy, one caveat to keep in mind: Do not turn a long-term capital loss into a short term capital gain. For example, selling the $28 stock now sitting at $16 (gee, I wonder what stock that could be?!) gives you a $12 long term loss, worth 20%. If you then buy a different $16 stock, and sell it for $28 less than a year from now, the gain is taxed at ordinary income rates (I believe). Your gain/loss before taxes is $0 in the combined trades, but you actually have a net loss, given the tax consequences. Ken