Tax Loss Harvesting Explained for Families Who Invest in Taxable Accounts

Hinzugefügt: 2026-05-23

[00:00:00]Tax loss harvesting sounds complicated, but it really just boils down to one idea. You're selling an investment that has lost value to offset gains somewhere else in your investment portfolio. The thing that people most often get wrong is thinking you're giving up on the investment market. You're not. You are selling the losing position, so the losing investment, but then you're immediately reinvesting those proceeds into a similar holding. So, you're not missing out on growth opportunities.

[00:00:28]But, here's where somebody can really miss out. Market conditions change quickly. Tax laws change, and that window to harvest losses is not always open. Missing it means you're leaving a real deduction on the table for yourself. And also, if somebody is making monthly contributions, they really need to be careful about wash sale rules. You're buying and selling something that you just harvested losses on within 30 days of that tax loss harvesting transaction. The IRS, because of that wash sale rule, disallows that loss entirely. And that's not ideal. Not giving this strategy, tax loss harvesting, enough attention is one of the biggest mistakes I see families with taxable investment accounts making.

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