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Can I do tax-loss harvesting myself?

Yes, although there are some significant complexities. You will need to track lot-level cost basis, identify alternate securities that are not substantially identical, but that correspond with your investment goals, periodically review your investment portfolio, and carefully observe the wash sale rule (even as it relates to rebalancing). Many high-net-worth investors look to their brokers or investment advisors to harvest tax losses, but typically only at year-end.

Wealthfront has built a sophisticated, algorithmic tax-loss harvesting service that checks client investment portfolios continuously and unemotionally. As a Silicon Valley technology company, we apply computational models where traditional financial organizations apply people. Software leads to a more accurate and lower cost solution.

 

Nothing in this blog should be construed as tax advice, a solicitation or offer, or recommendation, to buy or sell any security. Financial advisory services are only provided to investors who become Wealthfront Inc. clients pursuant to a written agreement, which investors are urged to read carefully, that is available at www.wealthfront.com. All securities involve risk and may result in some loss. For more information please visit www.wealthfront.com or see our Full Disclosure. While the data Wealthfront uses from third parties is believed to be reliable, Wealthfront does not guarantee the accuracy of the information.

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