Choosing Stocks

With stocks, you don’t pay taxes on your gains until you sell your shares — a feature which fans of stock investing say is a clear advantage in the long run. The downside, however, is that when you do cash in shares down the road, your tax bracket or the tax rate may have increased.
If you do have a stock loss ( which means a stock is worth less than what you bought it for), but the stock is one you want to own, consider selling the stock and rebuying shares at a lower price. The IRS allows you to consider this a wash sale, so you won’t have to pay capital gains tax. Note that you must wait 31 or more days before you can buy back the stock or else the IRS doesn’t allow the deduction.