How to deal with taxable holdings with large gains

[audreyh1]

Just to be clear, this is based on taxable income and not adjusted gross income, correct? If the former, that's good news. Our taxable income for 2023 was just under 105K and will definitely be lower for 2024 since I'm retiring in a few weeks. We should be able to stay under $94,050. It would be great if we could sell off a chunk of taxable holdings without triggering Federal capital gains tax. We'd still have state taxes to deal with but that's a lot better than Fed and state.

Right, it’s the taxable income which is after the standard deduction or Schedule A deductions. So for MFJ the 2024 limit is $94,050 and that’s after subtracting the $29,200 standard deduction from your AGI. A little higher standard deduction if one or more of you is over 65.

Sometime folks add those two numbers together to compare against your projected AGI.

 

[Texas Proud]

BTW, I wrote that you could sell a covered option awhile back... well, I just sold one today... and then the stock went up $4 (or course it does... ) and is just a few cents over the strike price... I have no problem with how it goes either way... 8 days left on the option...

 

[ychuck46]

Be very careful of the IRMMA hell. We are in our second year of it and it is painful. I made sure it ends after this year but I had some trading get out of hand 2-3 years ago, so both mine and my wife's SS and Medicare checks were lowered substantially.

 

[teej1985]

There is a chance that the standard deductions will be cut in half when the Trump tax cut expires in 2026

I don't see them reducing standard deduction without bringing back personal exemptions.