haha
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
I didn't really mean to suggest it was the result of bad investing. One takes these losses is a tax-strategic decision. Still, shouldn't they have run off fairly soon after? I compare it to a non-taxable account. If you buy something, and it goes down, you can decide that it was bad buy, or that it was a good buy but the timing was bad, or it was good and the timing was good but Fortuna was not with you. If you still like it as much as before, you keep it, since there is taxation to consider. But no mater how you look at it, your position would not ordinarily seem as good as it might have been had the stock you bought not gone down.p.s. My carry-over loss was not necessarily the result of bad investments such as Ha suggests with his car depreciation example.
In my case I bought high, then the market corrected. I sold before the end of the year to book the loss than repurchased the shares after 30 days to reestablish my position in the security.
If you sell ABC Corp at a loss, and then buy it back at the same price in an IRA you have spun some wheels and lost some money. If you do the same thing in a taxable account, you get a tax write-off, and you new shares have a lower basis than before, which if you sell them under the same tax regime will cause you to pay more capital gains tax than you would have had you kept and sold the original shares after they had come back into the same gain territory. But you have gotten a time value of money advantage, so it is usually worth the trouble. I do this regularly, but I also consider it getting some help after I had made what seems certainly to have been a suboptimal purchase decision.
Ha