Hi Andre, thanks again for a high quality post with timely reminder to sell my newly vested Meta shares. So I was looking at Schwab right now and using the specified lots feature to sell the vested shares from yesterday, and I dont see the latest lot from yesterday. I only see the lots from previous vests. It also says in info that 'Note that lots established today are not eligible for assignment'. So I usually sell the next day when this new lot becomes available. Curious how you are able to sell your shares today itself?
Great comment! If you have other lots, you actually will want to wait till tomorrow. The reason is that the Cost Basis will only load into schwab on V+2! If you are selling everything this isn't an issue since you don't need to select lots.
Hey Andre! I seem to have missed this and sold on V+1 and I had other previous lots still owned at this time (sold using LIFO). Not surprisingly, my Schwab history shows the cost basis as 'Missing' for the lots I sold on V+1. Do you have any guidance around what to do next- I basically want to ensure I don't have to realize some crazy gains or something similar. Thanks a lot!
You can call Schwab up and ask them to help re-assign the lots. Shouldn't be too much trouble. If you did LIFO I think it might be fine and just need another day for cost basis to load in, otherwise they can fix things for you.
Thanks once again for the high-quality content you have been generating! Regarding sales triggering wash sales: am I correct in assuming that in most cases we will be doing tax harvesting loss sales at the end of the year so February vest sales triggering wash sales is typically not a big concern?
You can be doing tax loss harvesting at anytime throughout the year. Last year was particularly easy to do at the end of the year since everything was down, normally it will fluctuate throughout the year and it could makes sense to harvest earlier.
I am not fully following the second part of your question. If you have a wash sale, the loss that you would normally have realized is used to reduce the cost basis of the new purchase that triggered the wash sale. It is forever attached to those specific shares until you sell that specific lot.
Thanks a lot for the clarification. That's just another reason, I should just go ahead and sell everything at Schwab. And if I do wanna hold a small portion of Meta shares, I should probably use another brokerage for that.
If you go that route just make sure you are abiding by all the blackout periods and margin restrictions. Schwab does all that automatically without needing to ever think about it.
Feb 16, 2023·edited Feb 16, 2023Liked by Andre Nader
Are you saying that as a way to avoid wash sales? They apply across brokers too and it would make it harder to keep track of, so I am missing what the advantage would be.
Sorry if that confused you. I used to keep a smallish amount of Meta stock in Schwab just to get some direct exposure to the stock (I know as a Meta employee I already get enough exposure via my future vests!) I have come to a realization that I might as well sell all my Meta RSUs and not hold anything. I do have a small quantity of Meta stocks in Robinhood from my pre-Meta days which I can still keep to get a little direct exposure to the stock. That also gives me a small advantage that I can sell today (V+1) instead of tomorrow in Schwab (V+2) since I dont need to worry about choosing lots.
Hi Andre, thanks again for a high quality post with timely reminder to sell my newly vested Meta shares. So I was looking at Schwab right now and using the specified lots feature to sell the vested shares from yesterday, and I dont see the latest lot from yesterday. I only see the lots from previous vests. It also says in info that 'Note that lots established today are not eligible for assignment'. So I usually sell the next day when this new lot becomes available. Curious how you are able to sell your shares today itself?
Selling based on LIFO (last in first out) may also work, but I have not personally tried this before the cost basis gets loaded in.
Great comment! If you have other lots, you actually will want to wait till tomorrow. The reason is that the Cost Basis will only load into schwab on V+2! If you are selling everything this isn't an issue since you don't need to select lots.
Hey Andre! I seem to have missed this and sold on V+1 and I had other previous lots still owned at this time (sold using LIFO). Not surprisingly, my Schwab history shows the cost basis as 'Missing' for the lots I sold on V+1. Do you have any guidance around what to do next- I basically want to ensure I don't have to realize some crazy gains or something similar. Thanks a lot!
You can call Schwab up and ask them to help re-assign the lots. Shouldn't be too much trouble. If you did LIFO I think it might be fine and just need another day for cost basis to load in, otherwise they can fix things for you.
Thanks once again for the high-quality content you have been generating! Regarding sales triggering wash sales: am I correct in assuming that in most cases we will be doing tax harvesting loss sales at the end of the year so February vest sales triggering wash sales is typically not a big concern?
You can be doing tax loss harvesting at anytime throughout the year. Last year was particularly easy to do at the end of the year since everything was down, normally it will fluctuate throughout the year and it could makes sense to harvest earlier.
I am not fully following the second part of your question. If you have a wash sale, the loss that you would normally have realized is used to reduce the cost basis of the new purchase that triggered the wash sale. It is forever attached to those specific shares until you sell that specific lot.
Thanks a lot for the clarification. That's just another reason, I should just go ahead and sell everything at Schwab. And if I do wanna hold a small portion of Meta shares, I should probably use another brokerage for that.
If you go that route just make sure you are abiding by all the blackout periods and margin restrictions. Schwab does all that automatically without needing to ever think about it.
Are you saying that as a way to avoid wash sales? They apply across brokers too and it would make it harder to keep track of, so I am missing what the advantage would be.
Sorry if that confused you. I used to keep a smallish amount of Meta stock in Schwab just to get some direct exposure to the stock (I know as a Meta employee I already get enough exposure via my future vests!) I have come to a realization that I might as well sell all my Meta RSUs and not hold anything. I do have a small quantity of Meta stocks in Robinhood from my pre-Meta days which I can still keep to get a little direct exposure to the stock. That also gives me a small advantage that I can sell today (V+1) instead of tomorrow in Schwab (V+2) since I dont need to worry about choosing lots.
hey, can you help list which low cost index funds are you investing? (e.g. is it VOO ?)
Typically VTI, VXUS, and a handful of fidelity Zero index funds. I went into a little more detail on my approach to index fund pairs in my post on tax loss harvesting: https://andrenader.substack.com/p/tax-loss-harvesting-is-a-waste-of-time?utm_source=profile&utm_medium=reader2