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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: Spots who wrote (2129)	4/10/1999 2:55:00 PM
From: Ron Kline	Respond to of 5810

I think some of us have run into this situation where you have lots of short term gains and some losers we have held way too long. When we finally decide to sell all this junk we end up with lots of long term loses and lots of negatives in the long term pile. So now my question is I had some dogs that I wanted to sell so I did. I have some short term gains I made this year and I have a portfolio of many gains which I haven't sold but am making good money on. Much of what is in my portfolio is short term but obviously will turn long term in 6 months or so. The questions are: 1)) Lets say for example I have 10,000 losses long term so far this year from the dogs, I've sold $15,000 in gains this year that are all short term, and I have 40,000 gain that is short term in my portfolio but has not been sold. Not taking account into what happens with these stocks I have, just looking at the tax situation what would be the best situation...sell them short term or wait for long term. 2) I've heard short term gains get offset by short term losses, and long term gains offset by long term losses. But in the above example I'm a little confused. 3) If I wait for these winning stocks to turn to long term gains aren't I just setting myself up for paying a bunch of short term gains since I will just offset the long term losses. Example I sell $10,000 in long term gains later this year to offset the $10,000 long term loss, and now I have to pay $15,000 in short term gains I made earlier this year? 4) Lets say I do nothing more this year, let all the winners turn to long term gains I sell nothing more this year, would that mean I would only pay $5,000 short term from example 1. Then wait until next year to sell all those winners that will turn into long term gains at the better tax rate. Confusing but can't explain the situation much better. Thoughts on this. Ron