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It absolutely does, if you can overvalue something and get away with it, and then sell it for an actually fair market price. This way you get to post a net los
by sgjohnson 4y ago
It absolutely does, if you can overvalue something and get away with it, and then sell it for an actually fair market price.
This way you get to post a net loss.
- refurb 4y agoGod I love HN. Tax are due on capital gains which is basically <sale price> minus <purchase price>. You can't claim a capital loss unless you paid the overvalued price. And then you just lost money anyways.
- salawat 4y agoIt's not so much just HN. https://www.investopedia.com/terms/t/taxgainlossharvesting.asp https://www.investopedia.com/terms/t/taxgainlossharvesting.a... It is literally a thing. I cannot for the life of me make sense of how to make it work that doesn't strike me as off, but enough people get utility out of the moniker that it's got a page. So...
- refurb 4y agoThat’s not the same thing. Tax loss harvesting is real, you just time when you take a loss to offset a gain. Then immediately reinvest. You haven’t lost any money in total, you can just claim the loss on your taxes (but will pay higher capital gains in the future).
- dikaio 4y agoExactly correct, legal, and done by every trader I know.
- sgjohnson 4y agoThere are ways to do that. The simplest one is to overvalue inherited assets. You don’t pay taxes on inheritance.
- Ntrails 4y agoManufacturing a fake loss with a false valuation is not the same thing at all - you've just said that "if you can do fraud, then sure there's money to be made from losses". Fraud makes money? Sure! Losses do not.