Monday, November 9, 2015

Recent buy & Tax loss harvesting

This week I have started tax harvesting. I have up to $3000 of losses I can lock in this year to reduce my taxable income for this year. I estimate that for every $3 I claim as losses, I can get $1 back due to the tax deduction.

$ amount sold
1/2 position in KMI: $2040
1/3 position in PX: $1150

I am adding APD in place of the PX I sold. I am replacing KMI with utilities and consumer staples. The following list will be stocks I will add tomorrow morning:

$ amount to buy
APD: $1200

NEE: $400
D: $430

ABT: $300
CL: $300
GIS: $300
PG: $250


As of now, I have around $1000 of my $3000 used up for tax loss harvesting (includes the KMI & PX sold, and some of the other few trades that happened earlier in the year). I pay $1 per purchase on Tuesday morning, so spraying this many purchases on other brokerages may not be ideal for others. Before performing tax loss harvesting, please consult with others and do research first to understand the pros and cons.

Happy investing
-YD

2 comments:

  1. I saw you are doing tax loss harvesting. The problem by selling is that if the price went up during the 30 days "wash sale window", you may actually end up being worse off. You may like this article on how I address this risk:

    http://www.dividendgrowthinvestor.com/2015/08/tax-loss-harvesting-for-dividend.html

    DGI

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    Replies
    1. Well written article. I agree that if you wait then you wait 30 days then you take the risk of missing when the stock increases.

      For PX when I sold it, I replaced it with APD right away. Those two companies are very similar.

      Regarding KMI, I did not feel comfortable with switching it for EPD or MMP right away since those two are MLPs with the K-1 forms. I did not want to add to my energy favorites XOM and CVX because I feel that they are expensive. I didn't want my cash to sit idle so I sprayed the funds in companies of the defensive sectors. Due to this, if pipelines so happen to raise in price in the next 30 adys, then I will not have the original holdings to benefit from it. However, I felt more comfortable with increasing my weightings in the defensive sectors though.

      YD

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