Should I take a $200k loss to offset profits?

[sprstpd]

Tax accountant and financial advisors.

Hire one and get to know them well so that you can call them any time especially in situations like this involving this amount of money.

Or just learn the tax code yourself.

 

[lawrence-lugar]

Take the loss. you still have a profit anyways overall.
you win some, you lose some.

(holding onto a losing trade because you think it will turnaround...an amateur trader thing to do.)

 

[Xela]

Doesn't seem like that stock is going anywhere

That suggests that it's not one you'd choose to buy, at its current price, under other circumstances and with plenty of available funds? But surely that's effectively what you'll be doing, if you keep it rather than selling it?

What would you do in my situation?

I don't know and understand enough about your situation to be able to answer this question confidently, but from what you've said above, all my instincts are that I would sell. I look at it the other way round from you, I think: if I wouldn't want to buy the stock at its current price, why would I want to retain it rather than selling it?

 

[Money Trust]

Sounds like you have a good problem.

 

[Scataphagos]

I've made $530k short term profit this year. So I'm facing a huge tax bill in April. However, I also made one horrible trade on TWTR and now am stuck with a $200k loss on the books. Should I sell off the loss to offset my profits and lower my tax bill? Per wash sale rules, I can repurchase the TWTR shares after a month. Doesn't seem like that stock is going anywhere, so I might be able to repurchase it around the same price, but I'm very uncomfortable taking a $200k loss. Seriously conflicted, and not sure what to do. Got 2 days to make a decision (before Jan 1). What would you do in my situation?

From sprsptd...
"... suppose you don't take the loss this year and your portfolio is flat the next year - well then you'd only be able to take $3,000 of that loss in 2016 (and have to defer the rest). So take the loss - it is a no-brainer. You get to take the full amount of the loss this year and you save on your taxes..."

 

[debitspread]

The time value of money is nothing, since interest rates are zero, so it doesn't really matter what year you realize a loss. Some slow learners still think in terms of 5%ish interest rates from years back.

 

[Xela]

it doesn't really matter what year you realize a loss.

But it can sometimes be hugely significant in which tax-year you take a loss.

 

[piezoe]

The time value of money is nothing, since interest rates are zero, so it doesn't really matter what year you realize a loss. Some slow learners still think in terms of 5%ish interest rates from years back.

It matters a great deal if he doesn't have trader status with the IRS, and it matters almost as much regardless. I'd take the loss against his gains now were I him. The present is always more certain than the future.

 

[clacy]

The time value of money is nothing, since interest rates are zero, so it doesn't really matter what year you realize a loss. Some slow learners still think in terms of 5%ish interest rates from years back.

What are the reasons for NOT booking a loss this year?

If his only reason is because he "hopes" twitter will take off, that's a horrible strategy, IMO.

I feel like you can't go wrong booking a loss as early as possible for in a taxable account. Always reduce your current taxes whenever possible.

 

[newwurldmn]

So OP has less than 24 hours to make a decision and he hasn't responded once. This is a troll thread.