capital gain tax

Forum|Forum|3 years ago
November 16, 2022
2 replies
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Is there any strategy to postpone (from 2022 to 2023) long term capital gains from the sale of stocks (sold in 2022)? I owe a lot of capital gains this year and want to reduce or postpone the capital gain tax from 2022 to 2023 if possible (when I will not be selling any stocks).

kdevere

Level 5

Unfortunately there are few ways to defer capital gains tax, for most stock sales, the tax is due on the capital gain in the year the gain was recognized. Capital gains are offset by capital losses, so if you had losses on some of the stock sales, you may reduce the capital gain. Also bear in mind that the tax rates on long term capital gains are different than ordinary income tax rates. For 2022 capital gains, the rates are:

Tax filing status	0% rate	15% rate	20% rate
Single	Taxable income of up to $41,675	$41,676 to $459,750	Over $459,750
Married filing jointly	Taxable income of up to $83,350	$83,351 to $517,200	Over $517,200
Married filing separately	Taxable income of up to $41,675	$41,676 to $459,750	Over $459,750
Head of household	Taxable income of up to $55,800	$55,801 to $488,500	Over $488,500

Another option is to invest in a Qualified Opportunity Zone. A QOZ is an economically distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment.
You can find out more information here:
https://www.irs.gov/credits-deductions/opportunity-zones-frequently-asked-questions#general

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