Take long term cap gains in 2021 vs 2022?

X

x-rays

so, I have somewhat of a dilemma. I have AAPL LEAPs that expire next year jan 2022. It's a sizable position, low 7 figure long term profit.

would it be best to close out the position by year end? ie, limit myself to the 23.8% long term cap gains tax?

Or keep it till expiration? which is 15 more trading days in January of 2022

one of the benefits of selling it next year, would to avoid paying taxes on the capital gains for another full year.
 
I wouldn't take the gamble if those OTM calls w/o locking at least some profit. I assume these are ITM ? (Your post is kinda vague for such a personal question.)

If your simply asking if AAPL has more run in it, than yes, I believe it does have more run in it.

Though, you should take all advice on a forum with a grain of salt....
 
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x-rays said:
so, I have somewhat of a dilemma. I have AAPL LEAPs that expire next year jan 2022. It's a sizable position, low 7 figure long term profit.

would it be best to close out the position by year end? ie, limit myself to the 23.8% long term cap gains tax?

Or keep it till expiration? which is 15 more trading days in January of 2022

one of the benefits of selling it next year, would to avoid paying taxes on the capital gains for another full year.
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assuming your thesis is intact I would close them in 2022 to push the gain off a year. That extra year could be worth another 3-5percent of profit.
 
yes, expires in Jan 2022.

that is my dilemma,

a. take the gains by end of 2021, limit myself to 23.8%

vs.

b. take gains after the new year, defer paying taxes for 1 full year, but cap gains rate could increase
 
GotherL said:
They expire in 15 trading days of Jan 2022.

There is no "extra" in the year.
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if he sells today he pays taxes on April 2022. If he sells on 1/2/23 he pays the same taxes on April 2024. That’s an extra year of float he gets on the taxes owed. Further it provides some gains in 2023 to offset losses in 2023 if he has a losing year.
 
x-rays said:
yes, expires in Jan 2022.

that is my dilemma,

a. take the gains by end of 2021, limit myself to 23.8%

vs.

b. take gains after the new year, defer paying taxes for 1 full year, but cap gains rate could increase
More...

I doubt Biden can do much on my taxes for 2024. His political clout is pretty weak and it looks like his tax focus is on estate and the Uber wealthy
 
Maybe scale out some if it hits near a 200 psychological level.

Technical wise, I think it looks good to hold esp with Christmas Iphone Sales around the corner.
 
x-rays said:
...
Or keep it till expiration? which is 15 more trading days in January of 2022

one of the benefits of selling it next year, would to avoid paying taxes on the capital gains for another full year.
More...

Technically you'd have to make an estimated quarterly tax payment by end of calendar Q1 2022, so you're not really saving anything by waiting. Because if you don't and wind up with a net profitable 2022, they could ding you with an interest penalty for a late payment. (Although the chances of them finding you for an audit are low).
 
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