True...need to watch how those losses are handled if you choose to attempt reducing income that way
As an example:
Say the only Cap Gains you have for the year are the result of Mutual Fund Cap Gains distributed each year at year end and reported in box 2a of a 1099-DIV form. Those $$ add to your AGI...but then, any 1099-B losses resulting from the actual sales of securities you might own....those losses (in this situation) will be used to offset the 1099-DIV box 2a $$ first. Then if the losses are greater than that, then up to $3000 more can be used to offset your other ordinary income (pensions, taxable Interest, ordinary dividends, etc)
____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*
