We wanted to be proactive and provide a friendly reminder that this time of year is the perfect time to review your statements for the capital gains/losses section for tax planning purposes. Below are some pointers as you are reviewing your accounts.

Do I have to worry about capital gains/losses for tax purposes?

The rule of thumb here is if you have capital gains/losses in a retirement account, you do not need to worry about them; however, if you have capital gains/losses in a non-retirement account, then you need to pay attention. Remember, this becomes important when gains/losses are “realized” or sold in the accounts. The chart below provides an even more detailed look at account types that are affected by the capital gains tax rules.

Where can I see how much I have accrued in capital gains or losses?

For our clients, keep watching your monthly Fidelity statements – generally, page 3 or 4 has a section labeled Realized Gains and Losses from Sales (as shown below). If you are working with another custodian, you should also have a similar section with gains/losses. Of course, your last statement will have your most recent year to date amount listed.

Make sure to share this information with your accountant or tax professional as a heads up. They may be able to assist you in helping to find ways to reduce your overall tax rate. For more helpful facts about capital gains and losses, check out this IRS article.