Tax Loss Harvesting Calculator

Calculate tax savings from harvesting investment losses against gains. See $3,000 carryforward rules.

By Konstantin Iakovlev · Updated April 2026 · Source: IRS — Forms, Instructions & Publications

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Tax Before Harvesting

$7,250.00

Tax After Harvesting

$2,900.00

Tax Savings

$4,350.00

Harvesting Details

Realized Gains$25,000.00
Harvested Losses$15,000.00
Net Gain$10,000.00
Total Tax Savings$4,350.00

Use the Tax Loss Harvesting Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

Selling investments at a loss to offset realized capital gains is a proven way to trim a tax bill, and this calculator quantifies the savings for you. It accounts for the $3,000 ordinary income deduction limit and projects how unused losses carry forward into future tax years, giving you a clear read on your position for 2026 and beyond so you can tune your portfolio and lower your overall tax burden.

The process begins by totaling your realized capital gains and your realized capital losses, then offsetting the gains dollar-for-dollar against the losses. When net losses run past your gains, up to $3,000 of the excess is applied against ordinary income, as 2026 tax law permits. Whatever remains beyond that is carried forward to later tax years.

Only realized losses, the kind that come from actually selling an asset, can be harvested; paper losses on positions you still hold do not count. Watch the wash sale rule as well, since it disallows the loss if you buy a substantially identical security within 30 days before or after the sale. Make sure you have enough gains to absorb, and keep the $3,000 ordinary income cap in mind, because anything above it can only be carried forward.

Example: Maximizing Your 2026 Tax Savings

  1. 1 Jane realized $15,000 in short-term capital gains and $5,000 in long-term capital gains in 2026. She also has $25,000 in short-term capital losses.
  2. 2 The calculator first offsets her $20,000 total capital gains ($15,000 STCG + $5,000 LTCG) with her $25,000 short-term capital losses, resulting in a net capital loss of $5,000. It then applies the maximum $3,000 of this net loss against her ordinary income.
  3. 3 Jane's 2026 taxable income will be reduced by $3,000. She will also have a $2,000 capital loss carryforward into 2027.
  4. 4 This strategy effectively reduced Jane's current tax liability by $3,000 and provides a $2,000 benefit for future tax years, showcasing the power of strategic tax loss harvesting.

Source: IRS — Forms, Instructions & Publications · Last updated: April 2026

Frequently Asked Questions

How does tax loss harvesting work?
You sell investments at a loss to offset capital gains and reduce your tax bill. If losses exceed gains, you can deduct up to $3,000 against ordinary income per year, with unlimited carryforward of remaining losses to future years.
What is the wash sale rule?
The wash sale rule prevents you from claiming a tax loss if you buy a "substantially identical" security within 30 days before or after the sale. To avoid it, wait 31 days to repurchase, or buy a similar but not identical investment (e.g., switch from one S&P 500 fund to another).
How much can tax loss harvesting save me?
At the 22% federal bracket, harvesting $10,000 in losses against gains saves $1,500 in federal capital gains tax. Against ordinary income ($3,000 max per year), it saves $660-$1,110 depending on your bracket. The real value compounds over time through deferred taxes.

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