I would not go 100% stock in your taxable account. You might want some bonds (individual treasuries, or ...) for emergency cash, or future purchases. Also, that way you won't have to sell stocks in a potentially down market (to buy a car, buy a house, etc...).
Capital Losses: Once you've offset either your long or short term gains, what is left-over can be used to offset the other (as mentioned above). But offsetting long term gain with short term losses doesn't seem like a good idea. Short term gains are taxed higher so short term losses are more 'valuable'. I'm not sure you are in that situation though.
The problems related to having a lot of bonds in taxable accounts is that 1) it increases your AGI (which affects Medicare MAGI/Tax, not sure that affects you now, but it probably will in the future), and some other things, and 2) you are taxed heavily (at normal income) on interest, where dividends from stocks are generally taxed at a lower rate. In general (but not all) interest rates have increased by roughly a factor of 10 from early 2022 (a 6-mo T-bill in early 2022 was .5%, now they are 5.5%). Those with lot's of bonds / fixed income in taxable accounts will be paying a lot of taxes on that this year. Good to have the return, but the taxes, if in taxable accounts instead of tax deferred, are paid up front.
Capital Losses: Once you've offset either your long or short term gains, what is left-over can be used to offset the other (as mentioned above). But offsetting long term gain with short term losses doesn't seem like a good idea. Short term gains are taxed higher so short term losses are more 'valuable'. I'm not sure you are in that situation though.
The problems related to having a lot of bonds in taxable accounts is that 1) it increases your AGI (which affects Medicare MAGI/Tax, not sure that affects you now, but it probably will in the future), and some other things, and 2) you are taxed heavily (at normal income) on interest, where dividends from stocks are generally taxed at a lower rate. In general (but not all) interest rates have increased by roughly a factor of 10 from early 2022 (a 6-mo T-bill in early 2022 was .5%, now they are 5.5%). Those with lot's of bonds / fixed income in taxable accounts will be paying a lot of taxes on that this year. Good to have the return, but the taxes, if in taxable accounts instead of tax deferred, are paid up front.
Statistics: Posted by LISD — Thu Dec 14, 2023 11:34 pm — Replies 33 — Views 3581