topic Re: Offsetting loss carry forward in Investing

Offsetting loss carry forward

circle11 — Mon, 23 Dec 2024 22:42:45 GMT

I have about 40k of loss carry forward shown on my 2023 Schedule D Line 16. Would like to fully offset it in my 2024 taxes by selling a mutual fund and realizing some gains. I have a mutual fund with current value of 350k and total gain of 150k. Is there a way to determine how much do I need to sell to realize 40k in gains? Don't want to sell more than I have to for offsetting that 40k of loss carry forward. Thanks in advance!

Re: Offsetting loss carry forward

Bsch4477 — Mon, 23 Dec 2024 22:54:32 GMT

Selling $93,000 should do it.

Re: Offsetting loss carry forward

circle11 — Mon, 23 Dec 2024 23:10:17 GMT

Thanks very much! Can you give me a rough idea re: calcs behind this answer?

Re: Offsetting loss carry forward

Bsch4477 — Mon, 23 Dec 2024 23:40:36 GMT

150/350 or 43% of your total value is capital gain. 43% of $93,000 is $40,000.

Re: Offsetting loss carry forward

VolvoGirl — Tue, 24 Dec 2024 00:27:26 GMT

First of all Schedule D doesn't actually show the carryover amount. To find your Capital Loss Carryover amount you need to look at your return schedule D page 2. Line 16 will be your total loss and line 21 should be a max loss of 3,000. The difference between line 16 and 21 is the carryover loss for next year.

There is also a Carryover Worksheet showing the carryover from the prior year and the current amounts. Then there is also the Capital Loss Carry Forward worksheet showing the amount transferring over to next year.

Then to sell your mutual fund you need to figure out the gains yourself. Did you buy the mutual fund all at once in the beginning? Or did you buy shares at different times? Or reinvest the dividends? You need to calculate the gain on each share to determine which shares to sell. They will have different gains on them. You might need to make a spreadsheet or list out all the buys. Maybe the fund company can give you the amounts. And you have to tell them which shares to sell. Like the first ones, etc. But if you bought all the shares at the beginning then the prior answer should be close enough. But I bet you have been reinvesting the dividends which was buying more shares at different prices.