Home > Resources > Video Library > Refresher on Tax Loss Harvesting
PIMCO Education

Refresher on Tax Loss Harvesting

John Nersesian, head of Advisor Education, provides a short primer on tax loss harvesting, a strategy that can help advisors alleviate their clients’ tax burden and improve their balance sheets. Interested in additional advisor and investor resources?

Visit pimco.com/taxlossharvesting

More from this section

Read Transcript

Text on screen: PIMCO EDUCATION –TITLE – Refresher on Tax Loss Harvesting with John Nersesian

Text on screen: PIMCO provides services only to qualified institutions and investors. This is not an offer to any person in any jurisdiction where unlawful or unauthorized.

Text on screen: John Nersesian, Head of Advisor Education

John Nersesian: Hi. I'm John Nersesian, head of Advisor Education at PIMCO.

Today we're going to be talking about a specific tactical opportunity around tax loss harvesting.

Graphic Title: Capital gains/losses recognition

Description: This graphic consists of two boxes, describing how capital gains and losses are calculated. One box is titled “Short-term transactions,” while the other is titled “Long-term transactions.” Each box contains a particular equation that results in a net position, over short-term and long-term transaction periods, respectively. The short term transaction box displays the following text beneath the title: Total short-term gains minus total short-term losses = net short-term position. Underneath the long-term transaction box, is text displaying: total long-term gains minus total long-term losses = net long-term position.

Let's start with a quick refresher on this capital gain and loss harvesting methodology, to take advantage of those opportunities when they exist in the marketplace.

Of course, we start first with short-term gains against short-term losses. We net those two together to come up with a net short-term position.

We then move the methodology over to the long-term position, those assets held in excess of 12 months, and we net out gains against losses there as well.

Graphic Title: Capital gains/losses recognition

Description: This graphic consists of two boxes, describing how capital gains and losses are calculated. One box is titled “Short-term transactions,” while the other is titled “Long-term transactions.” Each box contains a particular equation that results in a net position, over short-term and long-term transaction periods, respectively. The short term transaction box displays the following text beneath the title: Total short-term gains minus total short-term losses = net short-term position. Underneath the long-term transaction box, is text displaying: total long-term gains minus total long-term losses = net long-term position. A small table lists the possible outcomes of the equations: Both gains = each taxed at applicable tax rate; Both loss = deduct up to $3000 currently (short-term first), excess carries forward indefinitely; One gain/one loss = combine the two (net ST or LT, CG or CL), net gain taxed according to applicable rate, net loss deductible up to $3000 currently, excess carried forward indefinitely.  It’s noted that short term gains are taxed at ordinary income rates plus 3.8% net investment income tax, and long term gains are taxed at capital gains rate plus 3.8% net investment income tax.

Finally, we pull the two together, and we net out our net short-term position against our net long-term position utilizing that net number in a variety of different ways.

If we have a gain at the end of the day, that gain is going to be taxed based on the relative holding period. If, however, that netting methodology produces a loss, our clients of course can use losses, dollar for dollar, against realized gains. Anything above and beyond can be used up to $3,000 a year against ordinary income. Anything above that amount gets carried forward indefinitely.

Text on screen: To learn more visit pimco.com/YearEndPlanning or speak with your Account Manager

Text on screen: PIMCO

Disclosure


IMPORTANT NOTICE:
Please note that this video contains the opinions of the manager as of the date recorded, and may not have been updated to reflect real time market developments. All opinions are subject to change without notice.

All investments contain risk and may lose value.

PIMCO does not provide legal or tax advice. Please consult your tax and/or legal counsel for specific tax or legal questions and concerns. The discussion herein is general in nature and is provided for informational purposes only. There is no guarantee as to its accuracy or completeness.  Any tax statements contained herein are not intended or written to be used, and cannot be relied upon or used for the purpose of avoiding penalties imposed by the Internal Revenue Service or state and local tax authorities. Individuals should consult their own legal and tax counsel as to matters discussed herein and before entering into any estate planning, trust, investment, retirement, or insurance arrangement. This video is intended for investment professionals, but has been made generally available for informational purposes only.

The views and strategies described may not be appropriate for all investors. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. You should consult your tax or legal advisor regarding such matters. Please contact your account manager for further information.

PIMCO as a general matter provides services to qualified institutions, financial intermediaries and institutional investors. Individual investors should contact their own financial professional to determine the most appropriate investment options for their financial situation. This material contains the opinions of the manager and such opinions are subject to change without notice. This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management of America L.P. in the United States and throughout the world. ©2022, PIMCO.

Pacific Investment Management Company LLC, 650 Newport Center Drive, Newport Beach, CA 92660, 800-387-4626.

CMR2023-0830-3086203

Filters: Reset All

Filters

Close Filters Dropdown

  • Tags

    Reset

    Close

  • Category

    Reset

    Bond by Bond
    Careers
    Economic and Market Commentary
    Investment Strategies
    PIMCO Foundation
    PIMCO Education
    View from the Investment Committee
    View From the Trade Floor
    Viewpoints
    Education
    Close

  • Order By

    Reset

    Alphabetical
    Most Recent
    Close
() filters applied

Multimedia Finder

Filter By:
  • Bond by Bond
  • Careers
  • Economic and Market Commentary
  • Investment Strategies
  • PIMCO Foundation
  • PIMCO Education
  • View from the Investment Committee
  • View From the Trade Floor
  • Viewpoints
  • Understanding Investing
  • A
  • B
  • C
  • D
  • E
  • F
  • G
  • H
  • I
  • K
  • M
  • N
  • P
  • R
  • S
  • T
  • V
  • W
  • Z
Clear
Berdibek Ahmedov
Product Strategist
Robert Arnott
Founder and Chairman, Research Affiliates
Andrew Balls
CIO Global Fixed Income
Rachel Betton
Justin Blesy
Asset Allocation Strategist
Meredith Block
ESG Research Analyst
Allison Boxer
Economist
David L. Braun
Portfolio Manager
Jelle Brons
Portfolio Manager, Global and U.S. Investment Grade Credit
Nathaniel Brown
Director of the PIMCO Foundation
Erin Browne
Portfolio Manager, Asset Allocation
Grover Burthey
Portfolio Manager, ESG
Libby Cantrill
U.S. Public Policy
Kenneth Chambers
Fixed Income Strategist
Stephen Chang
Portfolio Manager, Asia
Devin Chen
Portfolio Manager, Commercial Real Estate
Richard Clarida
Global Economic Advisor
Mathieu Clavel
Portfolio Manager, Alternative Credit
Tony Crescenzi
Portfolio Manager, Market Strategist
Harin de Silva
Portfolio Manager, Special Situations
Pramol Dhawan
Portfolio Manager
Matt Dorsten
Portfolio Manager, Quantitative Strategy
Jason Duko
Portfolio Manager
Devin Ekberg
Senior Consultant, Advisor Education
David Forgash
Portfolio Manager
Preeyam Gandhi
Strategist
Max Gelb
Product Strategist
Nick Granger
Portfolio Manager, Quantitative Analytics
Adam Gubner
Portfolio Manager, Distressed Debt
Bill Gurtin
Gregory Hall
Head of U.S. Global Wealth Management
David Hammer
Portfolio Manager
Daniel H. Hyman
Portfolio Manager
Daniel J. Ivascyn
Group Chief Investment Officer
Henry Kao
Account Manager, Stable Value
Mark R. Kiesel
CIO Global Credit
Erica Kinsella
Product Strategist, ESG Strategies
Sean Klein
Head of Client Business Strategy – Client Solutions and Analytics
Kristofer Kraus
Portfolio Manager
Brian Kyle
Global Wealth Management
Jason Mandinach
Head of Alternative Credit and Private Strategies
Kyle McCarthy
Alternative Credit Strategist
Lalantika Medema
Alternative Credit Strategist
Vidur Mehra
Product Strategist
Mohit Mittal
CIO Core Strategies
John Murray
Portfolio Manager, Global Private Real Estate
John Nersesian
Head of Advisor Education
Roger Nieves
Sonali Pier
Portfolio Manager, Multi-Sector Credit
Christina Pihos
Defined Contribution Marketing
Gavin Power
Chief of Sustainable Development and International Affairs
Chitrang K. Purani
Lupin Rahman
Portfolio Manager
Graham A. Rennison
Quantitative Portfolio Manager
Antonese Robertson
Global Wealth Management
Steve A. Rodosky
Portfolio Manager
Emmanuel Roman
Chief Executive Officer
Jerome M. Schneider
Portfolio Manager
Marc P. Seidner
CIO Non-traditional Strategies
Emmanuel S. Sharef
Portfolio Manager, Asset Allocation and Multi Real Asset
Greg E. Sharenow
Portfolio Manager, Commodities and Real Assets
Kimberley Stafford
Global Head of Product Strategy; Responsible for Sustainability Oversight
Jason R. Steiner
Portfolio Manager, Private Lending and Opportunistic Strategies
Christian Stracke
President, Global Head of Credit Research
Richard Thaler
Distinguished Service Professor of Economics and Behavioral Science at the University of Chicago's Booth School of Business
François Trausch
CEO and CIO of PIMCO Prime Real Estate
D. Alan Trice
Matt Tuten
Portfolio Manager
Chad Van Dyk
Global Wealth Management
Megan Walters
PIMCO Prime Real Estate
Qi Wang
CIO Portfolio Implementation
Jamie Weinstein
Portfolio Manager, Corporate Special Situations
Paul-James White
Portfolio Manager
Tiffany Wilding
Economist
Jerry Woytash
Portfolio Manager, Short-Term Desk
Kirill Zavodov
Portfolio Manager, Real Estate
Mike Cudzil
Portfolio Manager
Chris Brightman
Chief Executive Officer and Chief Investment Officer, Research Affiliates
PIMCO
Ryan Mulvey
Strategist
Seray Incoglu
Portfolio Manager, Commercial Real Estate
Ben Bernanke
Chair, Global Advisory Board
  • Alphabetical
  • Most Recent
Section : Date : Experts :
Reset All
What to Expect When You’re Expecting Rate Cuts
Opportune Time for High-Quality Global Bonds
Today’s Historic Opportunity in Actively Managed Bonds (video)
Celebrating International Women’s Day
Risks and Opportunities: Moving from Cash to Bonds
Macro and Markets Q1 2024
Economic and Market Commentary

Macro & Markets – Q1 2024 (video)

Macro & Markets – Q1 2024

Join us for PIMCO’s “Macro and Markets” webinar, a quarterly conversation where we help contextualize the fixed income market and share insights from PIMCO’s Cyclical and Secular outlooks. In this edition –inflation, employment are rate cuts; how a soft landing is possible but risks remain; how markets may have already priced in a cutting cycle; and monetary policy across the globe.
Watch and earn 1-hour of complimentary Continuing Education (CE) for CFP, CIMA, CPWA, and CPA.

Earn CE

Load more results Load {{cCtrl.fetchResults}} more results