Calculate how much you can save in taxes by harvesting investment losses. Offset capital gains with realized losses, carry forward unused losses, and see the long-term impact on your portfolio.
Tax loss harvesting is a strategy where you sell investments that have declined in value to realize capital losses, which can offset capital gains and reduce your tax bill. This calculator shows you exactly how much you can save.
Capital losses first offset capital gains of the same type (short-term losses offset short-term gains; long-term losses offset long-term gains). Any remaining losses can offset gains of the opposite type. If you still have leftover losses after offsetting all gains, you can deduct up to $3,000 per year ($1,500 if married filing separately) from ordinary income and carry forward the rest indefinitely.
Long-term capital gains are taxed at preferential rates based on your taxable income:
See exactly how your realized losses offset both short-term and long-term capital gains to minimize taxes.
Get a clear breakdown of taxes owed with and without harvesting, plus your total savings this year.
See how unused losses carry forward year after year, offsetting up to $3,000 of ordinary income annually.
Uses the correct long-term capital gains tax brackets plus the 3.8% Net Investment Income Tax when applicable.
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Losses first offset gains of the same type, then the opposite type:
If net losses exist after offsetting all gains, up to $3,000 can offset ordinary income:
Review your portfolio at least once a year for positions with unrealized losses. December is a popular time for tax-loss harvesting, but you can do it any time.
If you sell a security at a loss and buy a "substantially identical" security within 30 days before or after the sale, the loss is disallowed. Wait at least 31 days or buy a different security.
After harvesting a loss, reinvest in a similar but not identical holding (e.g., sell S&P 500 ETF, buy total market ETF) to maintain market exposure while avoiding wash sale rules.
Short-term losses are best used to offset short-term gains (taxed at higher ordinary income rates) first. Long-term losses offset long-term gains (taxed at lower rates).
Tax loss harvesting is a strategy where you sell losing investments to realize capital losses, which can offset capital gains taxes. By intentionally realizing losses, you reduce your taxable capital gains and potentially lower your tax bill. Any unused losses can be carried forward to future years.
The wash sale rule disallows a capital loss if you buy a "substantially identical" security within 30 days before or after the sale. If the IRS determines a wash sale occurred, the loss is added to the cost basis of the new shares instead of being recognized. To avoid this, wait at least 31 days before repurchasing, or buy a different but similar investment.
You can deduct up to $3,000 per year ($1,500 if married filing separately) of net capital losses against ordinary income. Any remaining losses can be carried forward to future years indefinitely until fully used.
Yes, unused capital losses can be carried forward indefinitely until fully utilized. Each year, you can use up to $3,000 of carried-forward losses to offset ordinary income ($1,500 if married filing separately), and any remaining continues to carry forward. Losses never expire — they stay with you until used or until death.
Not necessarily. Consider the wash sale rule, transaction costs, and your overall investment strategy. Tax loss harvesting is most beneficial when you have capital gains to offset or when you can use the $3,000 ordinary income deduction. If harvesting would cause you to miss a market rebound or incur significant trading fees, it may not be worth it.
It shouldn't. Tax loss harvesting is a tax optimization strategy, not an investment strategy. After harvesting a loss, you should reinvest in a similar but not identical holding to maintain your desired asset allocation and market exposure. The goal is to reduce taxes without significantly altering your long-term investment plan.
Our Tax Loss Harvesting Calculator helps investors understand the tax savings potential of harvesting investment losses. Whether you're considering selling underperforming positions or want to maximize your after-tax returns, this tool provides clear, actionable numbers.
Full short-term and long-term gain/loss offset logic with correct long-term capital gains tax brackets and NIIT calculations.
See how carried-forward losses impact your taxes over the next five years with a clear year-by-year table.
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⚠️ Important Disclaimer: This calculator is for estimation and educational purposes only. Tax laws are complex and subject to change. The wash sale rule, alternative minimum tax (AMT), and other tax provisions may affect your specific situation. For personalized tax advice, consult a qualified tax professional or CPA.