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Can someone explain tax gain harvesting to me

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  • Can someone explain tax gain harvesting to me

    If a married couple has less than 80k in taxable income, are all long term capital gains taxed federally at ZERO?
    or can they only harvest an amount up to the 80k level; anything over goes to 15%?? Correct or not
    THANX!

  • #2
    Originally posted by Kennyt7 View Post
    If a married couple has less than 80k in taxable income, are all long term capital gains taxed federally at ZERO?
    or can they only harvest an amount up to the 80k level; anything over goes to 15%?? Correct or not
    THANX!
    See the following worksheet:

    https://apps.irs.gov/app/vita/conten...heet_1040i.pdf

    Use updated 2021 numbers for MFJ, which is $80,800 for what you are talking about at the 0% determination. Plug and play. It matters how much in cap gains you have.

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    • #3
      So if you have 96,800 in income and a standard deduction of 24,800(MFJ) you have 72k of taxable income. You can realize 8k in CG at a 0% federal tax rate, CORRECT??????
      For kids with UTMA accounts at age 18 this is a NO BRAINER to harvest 53k or so in gains for a Single Filer

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      • #4
        Originally posted by Kennyt7 View Post
        So if you have 96,800 in income and a standard deduction of 24,800(MFJ) you have 72k of taxable income. You can realize 8k in CG at a 0% federal tax rate, CORRECT??????
        For kids with UTMA accounts at age 18 this is a NO BRAINER to harvest 53k or so in gains for a Single Filer
        If long term capital gains, yes.

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        • #5
          thanx-many CPAS are not aware of this

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          • #6
            Originally posted by Kennyt7 View Post
            thanx-many CPAS are not aware of this
            Not aware of what? 0% tax on long term capital gains as a concept? If so they shouldn’t be CPAs.

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