Is An Unrealized Re Purchase Tax Deductible

I donate appreciated stock every year vice writing checks.  My basis in the stock is about $1. The current value is about $30.  I get a $30 deduction if I donate the stock.  If I sell the stock, I pay about $5 or $7 to Obama.

Let's take an overly simplistic example: (feel free to nitpick, this is purely to make the point of what unrealized means.)Bob owns a Startup business as a Founder. He's not a rich guy. But he saved some money up from his last job and because he's founded his own company XYZ Corp he owns 100% of it. But his business is not profitable yet.In fact he's been burning money and putting his own savings into his XYZ Corp for the past year trying to get his it off the ground. He hasn't even paid himself a real salary yet! He's growing users and the model looks good, but he hasn't gotten the scale he needs to make money.So Bob decides to get investment and because XYZ Corp's Business Model looks very good and he has the numbers to back up his claim, he manages to pull off a series-A investment round of one million with XYZ Corp valued at five million (post money valuation).Bob now owns 80% of a company worth five million dollars. XYZ Corp was worth zero when he founded it, so he now has four million dollars in unrealized gains and because he had to file a report about the new investment with the U.S. Securities and Exchange Commission (SEC), the government knows it.Let's say the tax rate is 25% for simple math. Bob now owes the government one million dollars.Bob doesn't have one million dollars. So he is now bankrupt.Unrealized gains should only be taxed if the taxes are also unrealized.Update: There are probably some innovative solutions to this and some decent reasons why you should tax unrealized gains. But that's not the question so it's not what I've written here. See the comments on some of the great answers here for a lively discussion on alternative solutions.

Sell the Long Term Losses---this is a no-brainer---and you will surely save $2300-5700 in taxes at some point.Reinvest the proceeds in 3 Different Funds.  This is an ill-conceived fund anyway, so doing this will be a plus. Make a note to yourself to examine gains and losses every year about Dec. 15.   If you'd done that in December, you would have saved ordinary income tax on $3000.  Sell all your shares purchased in 2014---in other words, book all your loses over a year old---which will eventually save you taxes this year and in subsequent years.If you want to remain invested in this fund, you cannot reinvest for 30 days, otherwise the losses you just booked would be seen as a sham (they'd violate the "wash sale" rule).  However, you can reinvest the proceeds from the sale in a different security that does the same thing.  If you want to stay with this allocation strategy, break it up into 3 chunks for better returns, easier tax management and allocation re-balancing:The stated investment objective of this fund is supposed to be 50/40/10Your current index fund asset allocation is 53% Large US Stocks,  41% Large Foreign Foreign Stocks, 6% Emerging Markets.Replacement ETFs:Large US Companies:  SPY, VONE or VTHR (Large and Small)Large Foreign Companies: EFA or VXUS  (Large and Small)Emerging Markets Stocks:  VWOYou could continue to buy ETFs for each Asset Class.  However, Indexing doesn't work well on Foreign stocks.  Consider a good, actively managed mutual funds with an experienced managers.

Tax loss harvestingTax loss harvesting is an opportunistic way to bolster your post tax returns. It is the act of booking any unrealized loss to reduce the tax outgo on your realized gain before the end of a financial year.As an investor, if you have any short term capital gains for the year you will have to pay 15% of this as tax. Assuming you have stocks sitting in your portfolio making a short term capital loss, you can book this loss, set it off against the gains, and hence reduce your tax outgo.So assume you have made Rs 1 lakh in trading profits from your short term equity delivery trades. This would mean your tax liability is Rs 15,000 on this gain. If you had stocks in your portfolio which are making Rs 50,000 in short term losses, you can sell these and book the loss. So now your net profit for the year is Rs 50,000 and hence your tax outgo is Rs 7500 (15%), a saving of Rs 7500.To make up for the stocks that you just sold to book losses, you can either buy a similar stock or wait till those stocks are delivered from your demat to buy them back again. So if you sold ICICI Bank to book a loss on Monday, you can either buy say a HDFC Bank immediately for the same value or wait for Wednesday to buy back ICICI Bank again. So you continue to hold the same portfolio, but by doing this transaction you would have saved Rs 7500.Tax loss harvesting reportZerodha, the stock broker has option to generate taxable format report to easily spot any tax loss harvesting opportunity on your account with us. The report will give you a quick view on all your realized profits for the year, and all unrealized losses on your equity holdings which could be booked by selling the stock and hence reduce tax outgo on your realized profits.See a sample report below on how by selling the 3 stocks and buying back again can save upto Rs 3000 in income taxes. We have spotted tax loss harvesting opportunities where clients can save lakhs of rupees that would otherwise have to be paid as income tax.Psychologically it is tough to sell loss making stocks, and the typical reaction is to postpone the decision making. If you are someone who is sitting on realized profits, make sure to use any unrealized loss to reduce your tax outgo.Source: Online stock trading at lowest prices from India's first discount broker

Apparently no, it would violate the rules against self-dealing.Self-dealing can taint any transaction that seems to promote self-interest. Transactions must be at arm’s length, which is what generally occurs between a willing buyer and a willing seller with no undue influence from outside sources. Here are a few examples of what the IRS or DOL may consider self-dealing with IRA funds:Purchasing stock in a closely held corporation in which the IRA owner is an officer or has a controlling equity position.Source: The Dos and Don’ts of IRA InvestingHowever, I believe you can contribute shares into a Charitable Remainder Trust.That is because you are granting the original property, not buying it. (You could not use the CRT to buy the shares, as that would again be self-dealing). You can even receive some tax deduction by contributing shares with unrealized capital gains. That may fit your objective. Talk to an accountant and a wealth advisor.

When trading or investing you need to classify your income under one of these heads, broadly speaking they are –1. Long term capital gain (LTCG)- selling after 1 year from date of purchase can be categorized under LTCG ,(equity & equity MF) is completely exempt from taxes2. Short term capital gain (STCG)- profit earned by investing into stocks or equity mutual funds holding for more than 1 day (also called delivery based) and selling them within 12 months3. Speculative business income- profits earned by trading equity or stocks for intraday or non-delivery is categorized under speculative business income.4. Non-speculative business income-Income from trading futures & options on recognized exchanges (equity, commodity, & currency) is categorized under non-speculativeplease do go ahead and explore this unique module on Markets & Taxation in zerodha varsity (Zerodha Varsity). I can assure you that the content presented here will make you more confident about matters related to taxation

If your securities have merely dropped in value, without you actually exercising any SALES of stocks/bonds/funds, then there will be no deduction for you.You bought 1,000 Units of X. If you still hold 1,000 units of X, then you have experienced no loss. You possess the same thing that you purchased. They have lost value, but until you actually SELL some units at a loss, then no loss is deductible. This is the difference between “Realized gains/losses” and “Unrealized.” Unrealized means that it’s lost value. Realized means that the sale has occurred, because you actually sold it. Only realized gains/losses are taxable. If you buy a stock in 2015, hold it for 5 years, and it gains value every year, then sell it in 2020, you will pay tax on the whole gain in 2020, instead of annual gains each year.IF you actually sell the securities at a loss, then yes, those losses, up to $3,000, is allowed against your other taxable income in the year. If you lost more than $3,000, then the excess is carried over to use in future years. It gets netted against future gains, if any.In MOST situations, this should lower your overall income tax bill, which wouldt lead to a slightly larger refund (assuming you were going to get a refund). If you’re ordinarily in the 25% bracket, then it theory it should reduce your overall federal tax bill by $750.However, your own tax situation is undoubtedly unique. Consult your tax advisor. You may have other transactions during the year that play into this, and may otherwise increase/decrease the tax bill.