Return to Blog

What is Tax Loss Harvesting?

On this week's episode, Brad Lyons, CFP®, Investment Manager, and Jordan Sute, CPA join Casey Smith to discuss tax loss harvesting. Tax loss harvesting is looking at a loss in your portfolio, selling it so that you can sell off the loss, and then reinvesting it into something else. This technique leverages a circumstance in your portfolio to enhance your tax standing. Just because you sell something doesn’t mean it’s bad. Most advisors don’t even think to do this.

Listen on Apple Podcasts or through YouTube:


Short Term and Long Term Losses

What is the difference between the two? The difference is one year. If you hold an asset for one year, it is classified as long term. Short term gains are taxed at ordinary rates whereas long term gains are taxed at capital gains rates. There are no Capital Gains taxes up to $80,000 in income.

Making Decisions Based on What You Know Today

Covid’s effect on the market ended up being very temporary, but at the time, we didn’t know if that would be the case. At Wiser Wealth, every morning Casey and Brad would get together to decide if that day was the day to rebalance the portfolios. In those moments, you don’t actually know what the next day will hold, so you just have to make the best decisions you can based on your experiences and information you are receiving.

Take Advantage of the Situation

In moments of market stress, it is wise to think about how, as an investor, you can take advantage of the situation. At Wiser Wealth, we have shadow portfolios that serves as a backup so that if we didn’t have one security, we already knew which one we would want to replace. It works the same way in our Flightpath program through Betterment, where it is going to automatically do tax-loss harvesting as it sees opportunities.

Something a Lot of Advisors are Missing

Solo advisors might not feel confident to do this on their own inside their portfolios. It adds to the rate of return after tax overall. As an advisor, when we look at the portfolio, we can be much more objective. As a DIYer, it is much harder to sell securities because there are a lot of emotional attachments to the securities. The idea of tax-lost harvesting is to buy the same value of the car so that the portfolio stays net.


4:49 Short Term and Long Term Losses

8:15 Making Decisions Based on What You Know Today

13:16 Take Advantage of the Situation

15:52 Something a Lot of Advisors are Missing


Learn more about Casey Smith and connect with him on Twitter.

Learn more about Brad Lyons.

Learn more about Matthews Barnett.


Twitter, Instagram, Facebook, LinkedIn, and YouTube.

Learn more about the Wiser Wealth Management Roundtable podcast and access previous episodes.

Wiser Wealth Management, Inc. is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

On today's podcast, the team talks about the differences between active vs passive investing. There are two very passionate sides to this long-time debate in our industry. Which approach is best? #passiveinvesting #typesofinvesting

Our firm is growing rapidly, and we are excited to add new team members! For detailed job descriptions and to apply, visit the careers page on our website.

#hiring #jobopening #internship #hiringnow

We think you should fire you small cap mutual fund manager! Watch this video to learn why. #mutualfund #smallcap #invest #investing #investments

Money matters are emotional because our livelihoods, families, and dreams can be greatly impacted by our financial decisions. Read today's blog to see if your investment behavior may be costing you. #invest #investingbehavior #investment

The US Federal Reserve, concerned about a deep recession has manipulated interest rates to help create certain conditions, but with rising inflation, low rates will disappear. Does this mean stock values will too? #interest #interestrates #investing

125 Church Street NE
Carmichael Building, Suite 220
Marietta, Georgia 30060



Client Access

Firm Information