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u/Long-Tax-133
14 hours ago
Advice Request
Would you use a capital-loss carryforward to temporarily liquidate a long-term portfolio ahead of the 2026 midterms?
I have a \~$200k investment portfolio with about $15k in unrealized capital gains. I also have approximately $18k in capital-loss carryforwards from previous years.
I’m a long-term investor and ultimately intend to hold essentially the same investments for many years. I’m not looking to permanently exit the market.
Because I have the capital-loss carryforward, I’m considering liquidating the portfolio and realizing the \~$15k gain, which should be fully offset by my existing losses. That would leave me with roughly $200k in cash and the opportunity to re-enter the market.
The question is how you would handle the re-entry, particularly given the historical tendency for increased volatility/weakness around midterm election years.
Would you:
1. Liquidate and immediately buy everything back, simply taking advantage of the tax opportunity?
2. Liquidate and DCA back in over the next 2–3 months, giving yourself some exposure to any potential midterm-related correction?
3. Hold the cash and wait for a significant market decline, while setting a hard deadline to be fully invested before the midterms?
4. Do something else?
I’m not trying to predict the exact bottom and I’m not interested in sitting in cash indefinitely. My goal is to remain a long-term investor while potentially using this tax opportunity to reset my position and take advantage of a possible correction before the midterms.