4 Benefits of Tax-Loss Harvesting

If you have heard of a strategy called tax-loss harvesting and you are wondering if it is a strategy you should consider, talk with a financial professional. 

A simple definition of tax-loss harvesting is when you sell select securities at a loss to offset your capital gains from other investments. Depending on your unique situation and financial goals, tax-loss harvesting can provide several possible benefits, including:

•    Saving on taxes – helping reduce the amount you may owe on capital gains taxes.
•    Growing your portfolio – if you reinvest your tax savings, you have the opportunity to increase the value your portfolio over time. 
•    Reducing your exposure to risk – by selling assets that are expensive or risky, tax-loss harvesting can help you do so with a potential tax savings. 
•    Mitigating the impact of market volatility – selling certain assets at a loss triggered by volatility may possibly result in a tax savings. 

Understandably, tax-loss harvesting is not for everyone and there are limits to how much you can write off each year, so review your situation with a financial professional before moving forward. 

Getting started is as easy as scheduling an appointment. 

Broker Dealer and its representatives do not provide tax services. Individuals should contact their own tax professionals prior to taking any action based on this information.