Thinking of selling 200k$ worth of amzn vested stocks and buying an index fund. Planning to put it straight into JEPI for the 7.7% dividend yield (instead of putting it in a HYSA for 5%), draw it down slowly and then dca into VOO over next 6 months. Assuming not much capital gains from selling JEPI gradually (it’s been kind of flat) Are there any other tax implications I should be aware of besides the tax in dividend from JEPI ?
Covered call ETFs are a horrible investment in the long run, they have an awful total return compared to the underlying equity. I can keep going about their negatives. Check this out: https://youtu.be/YMLVdY8y8vM
JEPI dividends are capital gains Id rather hold AMZN
Well what you should be aware of is POSTING YOUR TC
Won’t you have to pay capital gains after selling AMZN?
If you’re holding onto any AMZN after you vest you’re insane. You should always be selling all and reinvesting in a diversified portfolio. Sure you’ll get your random dude who joined in 2012 and never sold a share and did incredible but just because they had a good outcome doesn’t mean they made the right decision. Really the question you should ask every time you get a vest is “If somebody handed me this amount of cash, would I turn around and buy shares of Amazon?” If the answer is yes then fine leave it invested. If the answer is no, then you should sell and diversity. Selling upon vest will not incur any taxes because the tax basis is whatever the value is at vest - you don’t pay gains on it at vest you pay income tax.
Great advice and I have learned this the wrong way. I m sitting on a lot of RSUs from my previous employer and looking for an out without heavy tax bill. I live in CA so the capitals gains are gonna be a burden at state level as well, any leads ?
Capital gains after you sell. If you sell within 18 months, these are considered short term and taxed at ordinary income rate. If you sell after 18 months, they’re long term and taxed at dividend rate. Definitely don’t sell before 18 months.
I thought it was 12 months for the cutoff from short to long-term. Is it different for RSU’s?
Maybe 12, I can’t recall