I'm starting to think about taxes this year after an inheritance last year really rounded out our financial setup. I currently have our emergency fund in a HYSA at Ally, earning 4.35% APR.
I also have some short-term money in SPAXX at Fidelity.
Does it make sense to keep money in one vs another for short term savings/emergency fund from a tax perspective?
I.e., does interest earned on the HYSA count as income, while gains earned from SPAXX (taxable brokerage) count as long-term capital gains? I am wondering if moving my money from ALLY to Fidelity (SPAXX) would result in lowering my income and lowering my taxes paid on the investment gains if held for more than a year.
Thanks!
I also have some short-term money in SPAXX at Fidelity.
Does it make sense to keep money in one vs another for short term savings/emergency fund from a tax perspective?
I.e., does interest earned on the HYSA count as income, while gains earned from SPAXX (taxable brokerage) count as long-term capital gains? I am wondering if moving my money from ALLY to Fidelity (SPAXX) would result in lowering my income and lowering my taxes paid on the investment gains if held for more than a year.
Thanks!
Statistics: Posted by 41fan — Wed Jan 24, 2024 8:11 am — Replies 0 — Views 19