Say at the beginning of 2021 I deposit $25,000 into my portfolio and by the end of the year it’s at $15,000. With $10,000 in realized losses. I know I can write off $3000 of that. Now say at the end of 2022 my portfolio is back up to $25,000 with $10,000 in realized gains, so I would have to then pay short term capital gains tax on that $10,000 correct? And discounting the write off, would leave me paying taxes for $7000 even though I haven’t actually made any money. In that case, what would happen if I didn’t claim the losses for 2021 or my gains for 2022, and just transferred it into my bank and switched brokerages, because all the bank would see is me depositing $25k and withdrawing $25k. Is that illegal and would the IRS come knocking at my door?
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