Identify tax-loss harvesting opportunities in a portfolio by comparing unrealized gains/losses with wash sale rule checks.
A losing position only pays off once you sell it: a realized loss offsets capital gains dollar for dollar, plus up to $3,000 of ordinary income per year. This tool takes your positions (ticker, shares, cost basis, current price), computes each position's unrealized gain or loss, nets losses against gains, and shows how much loss you could use this year. It also runs the wash sale check, the usual surprise: buy a substantially identical security within 30 days before or after the sale and the loss is disallowed, added to the replacement shares' cost basis instead.
A concrete input and expected output from the current implementation.
Input
Ticker Shares Cost/share Current/share Recent buys VTI 100 $250.00 $220.00 bought 20 shares 12 days ago MSFT 50 $200.00 $250.00 AAPL 40 $180.00 $150.00
Expected output
VTI: 100 shares x ($220.00 - $250.00) = -$3,000 MSFT: 50 shares x ($250.00 - $200.00) = +$2,500 AAPL: 40 shares x ($150.00 - $180.00) = -$1,200 Wash sale check: 20 of VTI's 100 shares were bought 12 days ago, inside the 61-day window, so $600 (20 x $30) of the VTI loss is flagged as disallowed if sold now. Harvest summary: total loss $4,200, minus $600 at wash-sale risk = $3,600 usable. That offsets the $2,500 gain and leaves $1,100 of net loss, under the $3,000 ordinary-income cap: fully usable this year.
Selling all three positions realizes $4,200 of loss, but the 20 VTI shares bought 12 days ago fall inside the 61-day wash sale window, so $600 of that loss would be disallowed and added to those shares' basis. The remaining $3,600 cancels the $2,500 gain and leaves $1,100, under the $3,000 cap on offsetting ordinary income.
For each position the tool multiplies (current price minus cost basis) by shares held to get an unrealized gain or loss. It totals losing positions and gaining positions separately, then nets them dollar for dollar: losses cancel gains first, and any remaining net loss is measured against the $3,000-per-year limit on offsetting ordinary income, with the excess carried forward to future years.
Each loss position is checked against purchases of the same security inside the 61-day window running from 30 days before the sale through 30 days after it. For shares bought inside that window, the matching portion of the loss is flagged as disallowed under IRC Section 1091 and reported separately, since it would be added to the replacement shares' cost basis rather than deducted in the current year.
Yes. The wash sale window runs from 30 days before through 30 days after the sale, so a purchase on day 31 falls outside it and the loss is allowed. Inside the window, the disallowed loss is added to the replacement shares' cost basis, deferring rather than cancelling the benefit. Confirm the exact trade dates with your brokerage before relying on this.
Usually, up to a point: a net capital loss still offsets up to $3,000 of ordinary income per year ($1,500 if married filing separately), and any remainder carries forward indefinitely. But losses are only used at $3,000 a year and each harvest lowers your cost basis, so weigh transaction costs and expected future gains before selling purely for the deduction.
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