Lone Term Stock loss vs. Long term stock Gain

[footsox]

Hi Guys, I apologize. I think I have asked this before, but I cannot find it. If I sell stocks at a Long Term Gain (let’s say I gained $10,000). Then I sell stocks at a Long Term Loss (Let’s say Loss of $15,000). Both sales in the same year – 2024. Then I can take that loss against those gains, and after that would have the extra $5000 Loss to carry forward into the next tax year, of course $3000 can only be taken in the next tax year. I was confused about the $3000. I am not limited to taking only $3000 in that first year, I can take the whole $10,000 loss against the $10,000 Gain, and then carry over the $5000. Is this correct? Thanks so much.

[XMFBigFrog]

Close. You’re saying $15,000 loss, $10,000 gain. You first net the two together to get to a $5,000 loss. Then, you can use $3,000 of that net loss to offset ordinary income, leaving $2,000 of losses to carry over to the next year.

Note that if you’re married and file separate returns, I believe you each only get $1,500 to offset ordinary income.

Regards,
-Chuck
Home Fool

[aj485]

@footsox

Then I can take that loss against those gains, and after that would have the extra $5000 Loss to carry forward into the next tax year, of course $3000 can only be taken in the next tax year.

Sorry, that’s wrong.

$3000 in your excess loss would be applied to your ordinary income, and then additional excess losses (in this case, $2000) would be carried forward to the following year. And yes, this information has been given to you before in this thread Carry Forward Loss, if I only need the standard deduction this year? - Financial Planning / Tax Strategies - Motley Fool Community

@aj485

@footsox

So, I sold one stock at a loss in 2023. The loss was approximately a $2000 loss (long term capital loss).

First, that loss would be applied to any capital gains that you realized during 2023. Then, if you still have a net loss, up to $3000 of that net loss will be applied to your ordinary income for 2023. In your case, that means that you would have no remaining capital loss.

Since you continue to give significant examples of not understanding tax rules, I will (once again) STRONGLY RECOMMEND that since you are unwilling to continue paying your CPA to do your taxes, that you take advantage of the AARP Foundation’s Tax Aide service, where your taxes will be prepared for you for free. Here is the locator webpage AARP Foundation Tax-Aide Locator I am very concerned that your misunderstandings will end up costing you money, either in too much taxes paid, or in penalties and interest because of not paying taxes that were due.

AJ