I currently hold some shares of a stock that I don't expect to regain much value. I bought this (at a higher price) about 8 months ago.
My limited understanding of the way capital gains taxes work in the US (so please correct me if I am wrong) is that if you gain money on a stock that you owned for less than a year, you would pay more in taxes than if you had owned that stock for more than a year. Is there a similar principle for losses?
At this point, I don't expect the price of the stock in question to go up or down a substantial amount int he next few months. So, assuming there is no difference in taxes, I assume I should probably sell now, so that I can free up that cash, and reinvest in a different (hopefully better) investment. Of course, if I hold the stock, there is the long shot of the company being bought out, but I don't want to count on that happening.
So, my main question is:
Is there a difference, tax-wise in short-term and long-term losses?
Any other thoughts on my general approach are also welcome.
EDIT I should also mention that I am not really planning on having any realized capital gains this year, which might be useful to offset this loss.