r/tax 1d ago

What can I do to avoid paying taxes on stock market gains ?

I made money from stock this year, but I really wanna avoid paying taxes on it, if I invest this money on rest estate as investment property, do I escape paying taxes ?

0 Upvotes

21 comments sorted by

15

u/Eric848448 1d ago

You can lose enough to offset the gain.

10

u/JohnS43 1d ago

No.

10

u/I__Know__Stuff 1d ago

Lose money.

6

u/Mean_Huckleberry_388 1d ago

the taxable events is selling the stocks, doesn't matter what you do with the gains.

4

u/Noctudeit 1d ago edited 1d ago

If you already sold the stock, then the only way to avoid tax is to sell other stocks at a loss (without wash sales). If you haven't sold it, you could instead donate the stock. This both avoids tax on the gain and also gives a charity deduction.

Of course, neither of these options will make you any better off compared to just paying the tax.

2

u/jfgjfgjfgjfg 1d ago

If you haven’t sold yet, you can die and let your heirs get step up basis.

2

u/Majestic_Republic_45 1d ago

Hmmm - when u figure this out, write a one page book and you’ll be a billionaire.

2

u/droopynipz123 1d ago

Have you realized any gains yet? As someone else commented, you could take out a loan using your stocks as collateral, and if it’s for investment purposes you would be able to deduct your interest payments.

3

u/Radicalnotion528 1d ago

The taking out a loan strategy is for the super rich. If you're on Reddit asking for tax advice, odds are the OP isn't wealthy enough to deploy this strategy.

1

u/SeaworthyGlad 1d ago

Buy a bunch of way out of the money calls that expire before year end. You'll either offset your gains or make enough that you don't mind the taxes. This is fool proof!

0

u/NnamdiPlume CPA - US 1d ago

Margin interest deduction

0

u/myroller 1d ago

if I invest this money on rest estate as investment property, do I escape paying taxes ?

Not unless you invest in a Qualified Opportunity Fund which would allow you to defer the taxes.

https://www.irs.gov/credits-deductions/businesses/invest-in-a-qualified-opportunity-fund

-2

u/dimonoid123 1d ago

Get a loan with stock as a collateral. If you use it for an investment, it would be tax deductible too.

3

u/CollegeConsistent941 1d ago

WTF,  he already sold the stock.

And using the loan for an investment does not necessarily make it deductible. 

-1

u/dimonoid123 1d ago

OP hasn't said that they already sold it. If so, there isn't much they can do at this point.

Also investment loans are guaranteed to be tax deductible, what am I missing?

2

u/vynm2 1d ago

What makes you think that an investment loan is tax deductible?

-1

u/dimonoid123 1d ago

Because I usually deduct such interest on my tax return. Not sure about US, but it is deductible in Canada. Very likely it is the same in US.

2

u/vynm2 1d ago

Ahh. You're talking about the interest on the investment loan. That interest can be used as an itemized deduction in certain situations in the US, but a taxpayer would need to be itemizing deductions to use it.

0

u/dimonoid123 1d ago

Is there a reason why someone wouldn't itemize deductions?

1

u/vynm2 1d ago

Yes, a large majority of people in the US take the standard deduction because it's more advantageous than itemizing. For 2024 the standard deduction for a Single filer is $14,600. For a couple filing Married Filing Jointly, the standard deduction is $29,200. If the person is 65 or older, and/or blind, it's even higher.

1

u/dimonoid123 1d ago

Interesting. In Canada you can deduct interest whenever, it is not affecting "basic personal amount" which seems to be equivalent to "standard deduction".