For U.S. investors only — tax rules referenced here apply to U.S. federal tax law
TURN
VOLATILITY
INTO VELOCITY.
Algorithmic tax-loss harvesting that converts market setbacks into measurable tax savings. Surgical. Precise. Relentless.
37%
Max Tax Savings
30
Day Wash Rule
$3K
Annual Deduction
Estimated Tax Savings
$12,000
Based on 24% federal bracket · losses offset gains + $3K ordinary income
Tax Loss Harvesting
Calculator
Advanced real-time analysis with live price feeds, wash-sale rule detection, and multi-bracket projection modeling.
Total Estimated Tax Savings
$0
$0
Enter a cost basis, current price, and share count
or look up a live ticker above to auto-fill the price
EDUCATIONAL ESTIMATION TOOL — NOT TAX ADVICE. Results are estimates only. Tax outcomes vary by jurisdiction. Consult a qualified CPA or tax attorney before making investment decisions.
What Is Tax Loss
Harvesting?
"Tax loss harvesting is the deliberate sale of securities at a loss to offset a capital gains tax liability."
When investments decline in value, you can sell them to realize the loss on paper. That loss can then be used to offset capital gains from other investments — reducing the amount of tax you owe. After selling, you can reinvest the proceeds in a similar (but not "substantially identical") asset to maintain your market exposure while still claiming the tax deduction. The IRS's wash sale rule requires you to wait 30 days before repurchasing the same security.
01
Buy Investment
Purchase shares at your cost basis
02
Value Drops
Market decline creates unrealized loss
03
Sell at a Loss
Realize the loss by selling the position
04
Claim Deduction
Offset capital gains on your tax return
05
Reinvest
Buy a similar asset to maintain exposure
Key Benefits
Tax loss harvesting can meaningfully improve your after-tax returns over time.
55%
reduction in taxable gains
Offset Capital Gains
Every dollar of harvested losses directly reduces your taxable capital gains. If you have $50,000 in gains and harvest $30,000 in losses, you're only taxed on $20,000.
Gains $85k → After TLH $38k
$720
on $3,000 deduction
Reduce Taxable Income
Up to $3,000 in net capital losses can offset ordinary income annually — with excess carried forward indefinitely to future years.
Example savings at 24% bracket
$200K+
compounded over 20 years
Compound Tax Savings
Tax savings reinvested grow over time. A $5,000 annual tax saving invested at 7% for 20 years becomes over $200,000 in compounded value.
$5K/yr at 7% return
0%
additional tax cost
Portfolio Rebalancing
Harvesting losses creates a natural opportunity to rebalance your portfolio and realign with your target allocation — tax-efficiently.
Rebalance while harvesting
Harvesting Approaches
Four proven approaches to maximize your tax loss harvesting benefits throughout the year.
Why It Works
Capture losses before the tax year closes. Offset gains realized throughout the year and reduce your tax bill before filing.
When To Use
When you have unrealized losses and capital gains to offset before December 31st.
Example
You sold growth stocks for $20,000 in gains. In December, you harvest $18,000 in losses from underperforming positions — reducing your taxable gain to just $2,000.
The Wash Sale Rule
Understanding this IRS rule is essential to preserving your tax loss deductions.
The 61-Day Window
The IRS disallows a loss deduction if you buy a "substantially identical" security within 30 days before or after the sale.
Day -30
Day +30
Safe after Day +31 — no repurchase window
If triggered, the disallowed loss is added to the cost basis of the new shares — it's not permanently lost, but it defers your tax benefit.
What Counts as "Substantially Identical"?
Reference
Selling VOO (Vanguard S&P 500) and buying IVV (iShares S&P 500) is generally considered safe — both track the same index but are different funds from different providers.
Crypto vs. Stocks
TLH Rules
Crypto investors have a major structural advantage — no wash sale rule means you can harvest losses and repurchase immediately.
Stocks & ETFs
Wash sale rule applies
- ›Must wait 31 days before repurchasing the same security
- ›Buying within 30 days before or after voids the deduction
- ›Can immediately buy a similar (not identical) ETF as replacement
- ›Broker automatically tracks cost basis and provides 1099-B
- ›Market hours only: 9:30am–4pm ET, weekdays
Safe Swap Approach
Sell AAPL → Buy XLK (Tech ETF). Sell VOO → Buy IVV. Maintain sector exposure while preserving the loss deduction.
Cryptocurrency
No wash sale rule — major advantage
- ›Sell BTC at a loss and immediately repurchase — loss preserved
- ›No 30-day waiting period required for any cryptocurrency
- ›Trade 24/7/365 — harvest losses on weekends and holidays
- ›Must track cost basis yourself — exchanges often provide poor reporting
- ›Crypto-to-crypto swaps are taxable events (e.g. BTC → ETH)
Crypto TLH Example
Buy 1 BTC at $60k. Price drops to $42k. Sell for $18k loss. Immediately rebuy 1 BTC at $42k. Loss harvested, position maintained. New cost basis: $42k.
Stocks: Wash Sale Window
61 Days
30 before + sale + 30 after
Crypto: Required Wait
0 Days
Repurchase immediately
Crypto Advantage
100%
Full position maintained
Who Benefits Most
Savings
15–37%
Active Trader
Scenario
Frequent buying and selling creates regular capital gains events throughout the year.
Benefit
Harvest losses opportunistically to offset short-term gains taxed at ordinary income rates.
Key Consideration
Watch transaction costs — frequent harvesting can erode savings if commissions are high.
Savings
0–20%
Long-Term Investor
Scenario
Buy-and-hold investor with a diversified portfolio experiencing sector-specific downturns.
Benefit
Harvest losses in underperforming sectors while maintaining overall market exposure via similar ETFs.
Key Consideration
Long-term capital gains rates (0–20%) mean smaller but still meaningful savings.
Savings
23–37%+
High-Income Earner
Scenario
Income above $200k triggers the 3.8% Net Investment Income Tax on top of capital gains.
Benefit
Harvesting losses reduces both capital gains tax AND the NIIT surcharge — double benefit.
Key Consideration
Consider state taxes too — combined rates can exceed 30% in high-tax states.
Start Calculating Your
Tax Savings Today
Free to use. No account required. Results in seconds.
OPEN CALCULATOR