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Tax Loss Harvesting - Vanguard Wellington
11-21-2022, 10:41 AM
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#1
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Full time employment: Posting here.
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Tax Loss Harvesting - Vanguard Wellington
Before this year is out I plan to sell six figures worth of selected Wellington shares in a taxable account that will generate a loss.
Rather than park those proceeds in my settlement account for 4-6 months before I need them for a home purchase, what would be an equivalent fund(s) or ETF that I could move the funds to the same day without causing a wash sale?
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ER'd 6/1/2014 @ age 53. Wow, is it already 2022?
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11-21-2022, 10:47 AM
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#2
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2006
Location: Boise
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Have you evaluated the whole picture to see if holding the shares until you need to sell might be better?
Would the tax loss this year offset LTCG, STCG, some OI, or a mix?
Another approach might be simply to sell the shares now, wait 31 days, then re-buy.
I'm guessing that fund will have dividends in December. If you have dividend reinvestment turned on, that might result in a partial wash sale. Not a big recordkeeping deal if you only hold covered shares, but the loss you're hoping to book might be deferred.
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"At times the world can seem an unfriendly and sinister place, but believe us when we say there is much more good in it than bad. All you have to do is look hard enough, and what might seem to be a series of unfortunate events, may in fact be the first steps of a journey." Violet Baudelaire.
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11-21-2022, 10:53 AM
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#3
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
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So you're looking at parking this money substantially in equities for just 4-6 months? I am near the end of a similar scenario, building a house, and I moved the house money out of equities and into ultra-short bond funds immediately when we made the house commitment. I would have been a pretty sick puppy had we still been in equities going into this year. YMMV, of course.
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Ignoramus et ignorabimus
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11-21-2022, 10:56 AM
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#4
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Full time employment: Posting here.
Join Date: Jan 2014
Location: Austin
Posts: 661
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Quote:
Originally Posted by SecondCor521
Have you evaluated the whole picture to see if holding the shares until you need to sell might be better?
Would the tax loss this year offset LTCG, STCG, some OI, or a mix?
Another approach might be simply to sell the shares now, wait 31 days, then re-buy.
I'm guessing that fund will have dividends in December. If you have dividend reinvestment turned on, that might result in a partial wash sale. Not a big recordkeeping deal if you only hold covered shares, but the loss you're hoping to book might be deferred.
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Yes, this would be to offset other LTCG's.
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ER'd 6/1/2014 @ age 53. Wow, is it already 2022?
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11-21-2022, 10:58 AM
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#5
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Full time employment: Posting here.
Join Date: Jan 2014
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Quote:
Originally Posted by OldShooter
So you're looking at parking this money substantially in equities for just 4-6 months? I am near the end of a similar scenario, building a house, and I moved the house money out of equities and into ultra-short bond funds immediately when we made the house commitment. I would have been a pretty sick puppy had we still been in equities going into this year. YMMV, of course.
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Or what you did
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ER'd 6/1/2014 @ age 53. Wow, is it already 2022?
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11-21-2022, 12:09 PM
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#6
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 17,012
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Quote:
Originally Posted by Looking4Ward
Before this year is out I plan to sell six figures worth of selected Wellington shares in a taxable account that will generate a loss.
Rather than park those proceeds in my settlement account for 4-6 months before I need them for a home purchase, what would be an equivalent fund(s) or ETF that I could move the funds to the same day without causing a wash sale?
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Buy Treasuries for the time you need the money.
Since you need the money for a home purchase, it would be risky to buy any stocks, what if the market has a sudden 20% drop in 3 months and stays down for many months...
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Fortune favors the prepared mind. ... Louis Pasteur
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11-22-2022, 05:09 AM
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#7
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Thinks s/he gets paid by the post
Join Date: Jul 2013
Posts: 1,879
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Quote:
Originally Posted by Sunset
Buy Treasuries for the time you need the money.
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+100
Money needed in a few months should not be in equities or bond funds.
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11-22-2022, 10:28 AM
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#8
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Full time employment: Posting here.
Join Date: Jan 2014
Location: Austin
Posts: 661
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Quote:
Originally Posted by Sunset
Buy Treasuries for the time you need the money.
Since you need the money for a home purchase, it would be risky to buy any stocks, what if the market has a sudden 20% drop in 3 months and stays down for many months...
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Would putting the funds into 3 or 6 month Treasury Bills be a good move?
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ER'd 6/1/2014 @ age 53. Wow, is it already 2022?
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11-22-2022, 10:30 AM
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#9
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Thinks s/he gets paid by the post
Join Date: Jul 2013
Posts: 1,879
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Quote:
Originally Posted by Looking4Ward
Would putting the funds into 3 or 6 month Treasury Bills be a good move?
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Yes, but plan on holding it to maturity. If you need the money in 4-6 months, I wouldn't buy a 6 month bill.
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11-22-2022, 10:39 AM
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#10
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Full time employment: Posting here.
Join Date: Jan 2014
Location: Austin
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Quote:
Originally Posted by mrfeh
Yes, but plan on holding it to maturity. If you need the money in 4-6 months, I wouldn't buy a 6 month bill.
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Understood. Thanks!
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ER'd 6/1/2014 @ age 53. Wow, is it already 2022?
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11-22-2022, 11:29 AM
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#11
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Recycles dryer sheets
Join Date: Oct 2016
Posts: 430
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You can get a brokered CD that matures in 3 months paying 4% interest. 4.5% for a 6 month CD. At Vanguard/Fido/Schwab.
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11-22-2022, 11:32 AM
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#12
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Full time employment: Posting here.
Join Date: Jan 2014
Location: Austin
Posts: 661
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Quote:
Originally Posted by Go-NoGo
You can get a brokered CD that matures in 3 months paying 4% interest. 4.5% for a 6 month CD. At Vanguard/Fido/Schwab.
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Thanks!
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ER'd 6/1/2014 @ age 53. Wow, is it already 2022?
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