dgpcolorado said:
LTLFTcomposite said:
Here's a thought, if you have any doubt whether you will qualify for the full credit and you have any appreciated positions where you can book some long term capital gains, go ahead and do the sale in 2012, then rebuy the asset if you want. Sort of like a wash sale in reverse
With that
caveat about "tax advice from random people" noted, I will mention that another strategy, which I am using, is to convert some money from a regular IRA to a Roth IRA. That causes the money to become taxable income in the year the conversion is made (meaning
by December 31st for the 2011 tax year).
The Roth conversion is a good strategy. Nice. Selling and rebuying the asset is a little tricky. This isn't like a "wash sale" it could be a "wash sale". If you rebuy the asset within 30 days for tax purposes the sale never happened and there is no recognized gain. Sometimes you can get around this by buying a similar asset. For example, a total stock market index fund might be made up of an S&P index fund and an extended market index fund. You could sell the total market index and buy the other two in the right proportions on the same day without triggering the wash rules.
I think this is BTW what Occupy Wall Street is all about. That's not a criticism of anyone taking advantage of tax loopholes though. If the loophole is there then by all means take it. Manipulating transactions to minimize taxes is no more morally corrupt than taking a CARB rebate even if you don't need it.