Have a Tax Question? Ask a Tax Expert
Hi and welcome to our site.
You might be aware that if you hold shares in your brokerage account - the value of shares might go up and down - but that will NOT affect your tax liability.
That is unrealized gain or loss.
You will realize the gain or loss when shares are sold.
If you want to sell SOME shares - you will need to know the basis of these shares - and will calculate the gain or loss as
(selling price) MINUS (basis)
The administrator of your account will issue a form 1099B - reporting your sale transaction - and you will use that information on your tax return.
If you will realize a loss - that will be capital loss - and may be fully used to offset other capital gains - but if you have net capital loss - only up top $3000 will be used against other taxable income - and the rest will be carried over to following years.
Does that answer you question?