How to defer long term capital gains tax on stock sale ?
I want to convert some of my positions in company stocks to index funds (vanguard). Is there a way to defer paying capital gains tax for this? I would like to pay the taxes when I actually convert to cash. TC : 270k
Only 401k plan allows exactly this. You just defined 401k in other words.
Great analogy. Yep, I agree.
It depends on where you leave. If you are in US then you can’t defer your taxes. If you are in India then if you buy index fund with the net proceeds within 6 months of transaction then you don’t owe any taxes. I would recommend to talk with your CPA/CA for additional information.
As other posters have said, it's impossible. Though I want to clear up a common misconception with stock vests. Upon vest, the amount granted to you will be taxed at income levels. If you sell immediately, you'll only have to pay a day's worth of short term cap gains. So if you want to pay the least amount of cap gains, convert it asap. If you mean you already own Nvidia stock and want to convert, ignore the above paragraph, lmao.
Look into opportunity zones.
No way to defer, but you can offset them by selling individual stocks that you have equivalent losses on.
True but holding until you break even could be recommended in this case compared to wiping gains with losses just for taxation purposes. Still losing around 80% more to do this.
Efficient Market Hypothesis would tell you the current price is the true value at this moment. So it’s equally like to hold until you break even as it is to sink even further. The sooner you sell and derisk into indices the better.
Related question: how do you defer taxes on signing bonuses?
Unfortunately By not taking them at all 😄 Uncle Sam gotta have his share.
You don't.
In your case the only way to sell without paying capital gain is to sell with loss.
No. There is not a way. You pay taxes for each transaction if you're net-positive at end of year on your 1099-B.