Sorry for the specific post, posted on Robinhood sub and was deleted
Apologies for any mistakes.
I wanted to look into tax loss harvesting since I have already sold some winners this year, realized profit of about 25k. The premise of tax loss harvesting is to sell off my losers, and only pay tax on the net profit, correct?
I was looking into how to do this through Robinhood and although I kept seeing mention of Robinhood automating tax loss harvesting for Robinhood Strategies managed accounts, it was unclear how this applies to my brokerage accounts that I manage personally.
Essentially my question is whether Robinhood or other brokerages will track when I sell at a loss automatically and whether the 1099 I get will report only my net profit as income- or whether I need to actively track my losses, and enter those details manually.
Not really looking for advice, just trying to figure out how these apps work because I haven’t found clear answers.
Thank you!
Edit: would this also apply to losses on options that are out of the money?
Question about tax loss harvesting
byu/AttitudeWilling8839 intax
Posted by AttitudeWilling8839
2 Comments
Your brokerage will track your losses and report them on your 1099, just like they do your gains, yes (assuming that they have your correct basis information on file, which they might not if we’re talking about cryptocurrency transferred in from a different account).
You can sell losers to offset gains. Be careful not to buy them back within thirty days, so you don’t run afoul of wash sale rules.
1099-B will show all stock and option sales.