I have net capital losses that I cannot use to offset income for tax purposes.?

Question

I have capital gains in a stock I wish to hold but would like to get a step up in basis by using my losses. Do I have to actually sell the shares, incurring commissions, and immediately repurchase to realize my gain?

Answer 1

Capital losses can be carried over to next year, and it is usually better to use the loss to offset tax on ordinary income, since that is taxed at a higher rate.

Answer 2

If you sell stock A at a gain, you would have realized gains to put on your schedule D.

You can repurchase A immediately.

Your schedule D would combine all losses and gains that are on it.

(If you had the opposite situation, gains and wanted to get losses to absorb them, you wouldn't be able to repurchase the stock immediately because you would run afoul of the wash sale rules.)