INVESTMENT OPPORTUNITY

How To Turn Your Panic Sale Into a Tax Win

You didn’t plan to sell. You just wanted the pain to stop.

You watched red numbers stack up.

So you sold.

Now you’re staring at the loss, thinking:

“Did I just screw this up?”

Let’s be honest.

Panic-selling comes with a cost.

The loss is real.

The rebound might come without you.

And rebuilding takes longer from the sidelines.

But the story doesn’t end there.

The moment you sold, something else happened.

You unlocked a tool.

It’s called a capital loss. And it’s worth money.

If you sell something for less than you paid, that’s a capital loss.

You can:

• Cancel out other gains

• Deduct up to $3,000 from income

• Carry the rest forward, year after year

Less tax. More cash in your pocket.

Example:

You lost $3,000 on one stock but made $4,000 on another.

Now you only pay tax on $1,000, not $4,000.

No gains this year?

You still deduct $3,000 from your income.

Anything left? It rolls forward, year after year, until it’s used up.

But to keep that deduction, there’s one catch you need to know.

Don’t rebuy the same stock too soon

Purchase it again within 30 days, and the IRS treats it like the loss never happened.

That’s the wash-sale rule

It’s meant to block you from selling just to claim a tax break while staying in the same position.

Instead:

• Wait 31 days before buying it again

• Or buy something similar but not identical — same sector, different fund or stock

That way, you stay invested and keep the deduction.

Here’s what to do now

1. List what you sold at a loss

2. Find your original buy price

3. Subtract to get the loss

4. Save that number

5. Use it at tax time

That’s it.

The truth:

You sold because you were scared.

Now you have a chance to do something useful with that loss.

It doesn’t mean you failed.

It means you’re learning.

That’s how smart investors get better.

Talk soon,
Josh

P.S. If you’d like us to break down your portfolio or ask a question, submit yours here: https://shrewdinvestor.com/roastme

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The content provided in this newsletter is for informational purposes only and should not be considered as specific advice for any specific individual. The information is prepared by knowledgeable individuals and is not written by certified tax professionals or investment advisors. For personalized advice tailored to your unique financial situation, consult with a qualified tax professional, financial advisor, or attorney.

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