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margin interest expense to offset qualified dividends directly

jaywalker — Mon, 08 Apr 2019 17:59:11 GMT

Instead of margin interest expense(investment income expense) offsetting my income via itemized deduction, I wanted to see if its possible to offset dividends directly.

So let's say if

my dividend is 10k,

my capital gains are 25k and

my margin interest expense is 8k.

Can I directly reduce my dividends(or my capital gains by 8k) by 8k and hence only have to show 2k in dividend(or 17k of capital gains). I might not have enough in itemized deductions to reach the 24k threshold.

Re: margin interest expense to offset qualified dividends directly

NCperson — Tue, 09 Apr 2019 09:51:45 GMT

No

The margin interest is deductible as an itemized deduction only: you can’t net as you suggested

Re: margin interest expense to offset qualified dividends directly

jaywalker — Thu, 11 Apr 2019 05:21:05 GMT

Thanks.

Related to that. If I don't use my investment income expense this year to itemize my deductions, can I carry it over to next year?

Re: margin interest expense to offset qualified dividends directly

NCperson — Thu, 11 Apr 2019 10:08:47 GMT