# Do I need to sell all stocks before new year in order to claim money lost in stocks? [closed]

For example, I made \$1000 dollars in stock market on the first half year. I sold \$500 worth of stock. So I have \$500 still in the market and \$500 in cash. Then I bought \$4000 new stocks in the 2nd half year. In December, the \$4000 stocks dropped to only \$2000 in value. So in total, I lost \$1000 this year.

In order to claim the \$1000 net lost in tax credit, do I need to sell all the stocks before the new year? If I don’t sell off the stocks, will I have to pay the tax for the \$500 that I made in the first half year by selling the stocks?

• Yes on both counts. Only realized losses are tax relevant. Dec 20 '21 at 18:31
• You haven't lost any money until you actually sell the stock for less than you paid for it. Dec 20 '21 at 18:41
• Your math doesn't add up. You say you "made \$1000" but had \$500 in stock and \$500 in cash after selling. How much did you pay for the stock that made \$1000? Then you say you lost \$2000 in the second half so lost \$1000 in total. \$500 - \$2000 = -\$1500, not -\$1000. Dec 20 '21 at 19:14
• I'm just trying to make sure you know that you're taxed on gains and losses, not on the total amount that you sold for. So you may not have to pay tax on all \$500. Dec 20 '21 at 19:15
• You haven't lost any money until you actually sell the stock for less than you paid for it. That is incorrect. At this point in time he has lost the money but he hasn't realized the loss. Dec 20 '21 at 19:43