Changing short-term to long-term doesn't change refund calculation

[ncknck]

Hi,

I use TurboTax Premier 2018. When I entered a gain from stock, at first I accidentally entered it as short-term. When I fixed it by changing it to long-term, the tax owed calculation remain the same.

Is this a bug? Did I miss something?

[NCperson]

It is possible - did you also have capital losses?

[ncknck]

Yes, I also have capital loses from stock (different stock). But shouldn't it result in tax owed difference still, because the capital gain percentage between short term vs. long term is different?

[NCperson]

You would think so, but it depends

- long term losses are used to cover long term gains only
- short term losses are used to cover short term gains first and then are used to cover long term losses

Did you have a short term loss? And if yes , when you moved a gain from short term to long term, it didn’t make a difference based on my 2nd bullet

The IRS is smart enough that you can’t use long term losses to cover short term gains because the tax rates are different and it’s to the IRS’s disadvantage to permit it