Zero Capital Gains Tax Harvesting

Zero Capital Gains Tax Harvesting is a tax strategy used by investors to minimize or eliminate capital gains taxes on the sale of investments.

This approach involves selling investments that have appreciated in value and offsetting those gains with losses from other investments that have declined in value, a practice known as tax-loss harvesting. The goal is to strategically realize gains up to the limit of the investor’s tax-free capital gains threshold, allowing them to benefit from the appreciation without incurring tax liabilities.

For example, if an investor is in the 0% capital gains tax bracket, they can sell stocks that have appreciated and realize gains up to a certain limit without incurring taxes, provided they also sell enough losing investments to offset those gains. This strategy can help increase an investor’s after-tax returns while maintaining their overall investment strategy.