I sold $x in stocks in Apr 2020 to pay tax for 2019 Tax. In 2021, will this $x in stocks be exempted from taxable income or should i pay tax on the tax paid ?

[sundaramsecuid]

- does brokerage supports selling shares for tax payment that directly sends payment to IRS ?
- If not i sell shares for paying taxes and then that is considered as income for next year tax assessment.  Is there a way to avoid paying tax on tax ?

[Critter-3]

You sold stock which is a taxable transaction no matter what you did with the proceeds.  

[Hal_Al]

"does brokerage supports selling shares for tax payment that directly sends payment to IRS"

What does that mean?  If your broker withheld federal tax on the April 2020 sale, that tax will be applied to your 2020 tax return, not your 2019.

[Critter-3]

Even if you use the brokerage checking account to send the IRS payment the underlying stock sales to free up cash to pay the IRS is STILL a taxable event ... there is no way around that fact.   Now if you have some losers in the barn you want to sell by the end of the year to negate the cap gains in the account then that is perfectly legal.