I want to confirm that I'm right to avoid surprises. If I buy a stock (or group of stocks) at 70 and I sell it (them) when its value is 60... I should not pay any kind of taxes, no? Since I did not earn, in fact I lost 10.

I'm totally new on this also in the States what makes things doubly difficult.


3 Answers 3


You would not pay any taxes on losing money. Depending on how long you take before selling you will either have a capital loss or short-term capital loss (ordinary loss). You can net these against your gains, and up to $3000 can be deducted from your regular income (W-2, dividends, etc).

  • More precise would be "a long-term capital loss or a short-term capital loss" rather than "a capital loss or an ordinary loss".
    – nanoman
    Commented May 28, 2019 at 18:08

With the usual disclaimer to visit a tax consultant for advice closely pertinent to your financial situation...

Short answer: You not only don't pay taxes but also get to deduct the losses from your net taxable income.

If you held the stock for less than a year you get to offset it against potentially short term gains from other stocks. For ex, you sold stocks (that you held for 6 months) for a net profit of $1000 and from the sale of 10 of the stocks you mention you overall incurred -$100 your net taxable capital gain is $900.

For long term losses you get to offset them against long term gains and if there are enough gains to be offset then you could apply the remaining losses (if any) to short term gains.

Further, if the losses are still greater, then you could apply them against your ordinary income (check the limits for 2019).


In addition to what the other answers said, if you have losses left over after using them to cancel capital gains that you took in the same year, and after adjusting your other income downward by $3,000, you can carry your losses forward for as long as they last. But each year you must "use up" as much loss as you can, as described in the accepted answer, and also above.

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