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Year-End Investment Moves

Published by Jamie Nau on 08 Nov 2018

The year’s end is growing close and this is a good time to sift through and clean up your investment portfolio. Below are three year-end suggestions that may perk up your portfolio and provide some tax saving advantages as well.

  1. Wash sales. Are you considering the sale of a security before December 31st to take advantage of a capital loss? If you are, make sure that diversify stocksyour loss is deductible. Do not buy a significantly identical security during the 61 day time frame that begins 30 days before you sell and 30 days after you sell.
  2. Valueless stocks. For those who want to deduct a valueless stock on your 2018 tax return, you will have to prove they actually have no value and that the stock became valueless during the year. If you are not sure you can meet these requirements, selling before the end of the year may be a good option for you. For the purpose of capital losses, any valueless securities are treated as though you sold them on the last day of the year. Generally, your loss is the same as your cost.
  3. Donating stocks. You can claim a charitable deduction and avoid capital gains tax when you donate stocks to charity.

To be able to deduct your stock donation on your 2018 tax return, your gift must be complete. If your broker or the issuing company conducts the transaction on the date when the stock is titled to the charity, the gift is complete. If you endorse and present the certificates directly to a charity, the mailing date or other delivery date will be considered the date of the gift.

At Summit CPA we offer multiple resources to assist you with all of your tax and financial planning needs. Contact our office at 866-497-9761 to schedule an appointment with our advisors.


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