Farm Your Tax Losses Time

If you have lots of capital gains this year (and if you do, you must be doing pretty well), and need to reduce your tax exposure, consider liquidating the stocks you are holding at a loss, especially if you don't think they will be rising soon. Don't forget the Wash Sale Rule:

A wash sale occurs when you sell or otherwise dispose of stock or securities (including a contract or option to acquire or sell stock or securities) at a loss and, within 30 days before or after the sale or disposition, you:

Buy substantially identical stock or securities,

Acquire substantially identical stock or securities in a fully taxable trade, or

Enter into a contract or option to acquire substantially identical stock or securities.

You cannot deduct losses from wash sales unless the loss was incurred in the ordinary course of your business as a dealer in stock or securities

Just remember: You need to talk to your accountant or tax advisor about any tax issues and questions before doing any tax selling.