When to sell a fund for a gain...

[cypher1]

Just looking for thoughts on when to sell an individual stock in taxable account. Back in March 2020 I jumped on the bandwagon and bought some individual stocks. The last one left is RCL, bought at 33.33 per share and currently around 310. That stock amount only represents about 1-1.5% of my portfolio. I don't need the money any time soon, but really just looking to lock in some gains and one less fund to watch on my list. Besides LTCG tax considerations, I'm just wondering if it makes sense to sell by end of this year to rebalance or let it ride.

[LivingAlmostLarge]

What's your income and will you want to pay the capital gains of 15% and 3.8% NIIT? Depends. Any chance of a low income year coming up? If not then suck it up and sell.

[Jluke]

Sell all in 2025
Sell half in 2025 and half in 2026
Sell all in 2026

all depends on your tax situation for each year.

just be sure you know where the money is going after the transaction is complete - invest, savings, debt if any

[disneysteve]

"Never let the tax tail wag the dog"

If you think the future prospects for the stock are less appealing than they were before, sell it and pay whatever tax is due on the gains. Sure, it might push you into a higher bracket for the year, but taxes are tiered. You only pay that higher rate on the amount of taxable income that falls into that bracket.

Look at it this way. Which would you be more upset about? Selling the stock and paying the taxes but locking in the gain, or holding onto the stock to avoid taxes and seeing the value fall significantly erasing much of the gain?

[cypher1]

What's your income and will you want to pay the capital gains of 15% and 3.8% NIIT? Depends. Any chance of a low income year coming up? If not then suck it up and sell.

That's right! I forgot the BBB changed the tax rates for capitals gains going forward. Thanks Trump! (sarcastically). I was factoring to pay 20% rate. NIIT won't apply with my annual salary around 108K and last year's taxable income about 74K to gauge.

With all the layoffs continuing at my work, I do expect to get laid off some time within the next 6 months. Just a matter of time but further reason to possibly postpone on selling.

I do like Jluke's suggestion of half this year and the other half next year. But at the same time, the profit or gains right now is only about 8K unless the market drops. Either way, I appreciate all the feedback so far.

[LivingAlmostLarge]

sell off for $8k deleverage or do it end of december 50% and january 50%. I want to deleverage myself as well. But i need to see where our income plays out first.

[james.hendrickson]

Why not keep it and pass it on to your children? Nothing says you have to sell, and it sounds like you don't need the money immediately.

[Fishindude77]

I know a lot of folks wheel and deal stocks trading often. Do what works for you.
Personally, I'm not a fan of buying any single stock I'm not prepared to hold onto long term.

[LivingAlmostLarge]

Why not keep it and pass it on to your children? Nothing says you have to sell, and it sounds like you don't need the money immediately.

Because sometimes you want to deleverage your risk. I am in that boat I would like to deleverage our risk. I don't care if it costs us money and we've done it along the way. I think we'd have more if we hadn't.

[cypher1]

Why not keep it and pass it on to your children? Nothing says you have to sell, and it sounds like you don't need the money immediately.

I was originally going to do something like LAL previous suggested; selling 50% by the end of this year and the other 50% early next year. But I figured I'd let it ride until I decide to put towards a major home expense or job loss. I simply removed the fund from my widget so I don't see it anymore.

But I also agree with LAL's point about deleveraging risk at a cost out of convenience. Or where rebalancing comes in to a certain degree. My initial post was more about just wondering how much is enough on a gain and to lock in that gain, even for a such a small percentage in my portfolio.

[Like2Plan]

I was originally going to do something like LAL previous suggested; selling 50% by the end of this year and the other 50% early next year. But I figured I'd let it ride until I decide to put towards a major home expense or job loss. I simply removed the fund from my widget so I don't see it anymore.

But I also agree with LAL's point about deleveraging risk at a cost out of convenience. Or where rebalancing comes in to a certain degree. My initial post was more about just wondering how much is enough on a gain and to lock in that gain, even for a such a small percentage in my portfolio.

There is another thing you could do if you wanted to keep the stock. You could tax gain harvest--by selling the stock, paying the capital gains and then buy the same stock right back.
You could also do that 50% this year and 50% next year using specific ID when you do your trades.