Tax Loss Harvesting Question

[ownyourfuture]

Since I’m 58 & have a ACA high deductible health care plan, I have to watch my income closely. The MAGI cliff for 2020 is $49,960.00

An estimate of the remaining dividends to be paid for 2020, shows I should be under the cliff, but only by approximately $1,500.00
*I've already contributed the max of $4,550.00 to my HSA*

To err on the side of caution, I may decide to realize some losses.
I have a substantial amount of those in Kinder Morgan Energy (KMI)

I'm guessing I first purchased shares around 2008.
On December 3rd 2014, the company reorganized. They changed from an MLP, to a C-corp. New shares were assigned to me, & any previous buys, dividend reinvestments, cost basis, etc were erased & my new purchase date was
12-03-14

I haven't had a lot of experience in tax loss harvesting, choosing FIFO, or specific shares to sell, etc, which leads me to my question.

The cost basis for the new shares assigned to me is $40.53

Let's assume I want to realize approximately $1,000.00 in losses & use the FIFO method. Shares closed at $13.03 today, $27.50 lower than 2014. If I understand it right, I could sell 35 of those shares & realize a loss of $962.50

Is this correct ?

Thanks in advance.

[pb4uski]

Yes, looks correct to me as long as you don't repurchase the same shares within the alloted time. Since the basis of all your shares is $40.53 a share, it doesn't much matter if you use FIFO or average cost or specific identification.

[ownyourfuture]

Quote:

Originally Posted by pb4uski Yes, looks correct to me as long as you don't repurchase the same shares within the alloted time. Since the basis of all your shares is $40.53 a share, it doesn't much matter if you use FIFO or average cost or specific identification.

The vast majority of the shares have a basis of $40.53, some are lower due to dividend reinvestment at later dates.


Thanks for the reply.

[FLSUnFIRE]

Watch the dividend reinvestment, you will want to discontinue that until meeting the time requirement for wash sale.

[ownyourfuture]

Quote:

Originally Posted by FLSUnFIRE Watch the dividend reinvestment, you will want to discontinue that until meeting the time requirement for wash sale.

My sincere thanks!
I never would've thought of that

[tenant13]

The most beneficial losses are short term so if you have something that lost money within the last 12 months, sell that first.
https://www.investopedia.com/article...es-and-tax.asp

[ownyourfuture]

Quote:

Originally Posted by tenant13 The most beneficial losses are short term so if you have something that lost money within the last 12 months, sell that first. https://www.investopedia.com/article...es-and-tax.asp

Thanks for this.