> and immediately buying them back
That's called a wash sale and the IRS is going to have a word with you about it. If you're going to do these things, I recommend getting some advice from a tax accountant.
That's called a wash sale and the IRS is going to have a word with you about it. If you're going to do these things, I recommend getting some advice from a tax accountant.
One can sell a stock, pay the gains, and buy it back immediately at current market value making the holdings cost basis today's market value.
Why would you do such a thing? Exactly as the GP said, to take advantage of better capital gains rates during a low income year.
Another fun one is deliberately realizing small gains in a kid's UTMA account then paying a modest sum to file taxes for the kid. Only works for a specific amount of gains/income each year so read up first.
Tax gain harvesting is similar, but the opposite of tax loss harvesting in some sense, because instead of a loss, you are taking a gain in a low income year. IRS doesn't care if you are generating capital gains, because for most people with stocks (read: not making low income) it increases your taxes owed.
1: https://www.investopedia.com/terms/s/substantiallyidenticals...
For something like VTI, you have about 4 other companies that have a similar product you can execute it with. Schwab, Fidelity, iShares, SPDR. Other major banks probably also have them, but they're usually not as popular.