I have a position in asset that I plan to hold for a long time. Currently its market price is on a downtrend and could possibly turn into a capital loss. I am not concerned about the near term price fluctuations.
At the same time, I notice that I can sell some of it at a price lower than my cost basis, which would generate a capital loss tax event. The idea is that this asset appreciates in value over time, surely this could fail, but is irrelevant to this discussion.
I also wouldn't be opposed to acquiring more of this asset at a lower price, eventually lowering my cost basis.
I feel like this has something to do with wash sale rules, or something similar but I'm not sure.
What I notice is that using the way the rules are written, I could lower my income tax burden by $3,000 now or more within the next 7 years (offsetting capital gains if I ever sell something at a profit), if I simply sold while market price is lower, even though I don't necessarily intend to realize capital gains on this particular asset.
Are there consequences or considerations I should make using this seemingly gimmicky way of lowering an income tax burden? Maybe some regulation against selling just enough to report a $3000 loss, while maintaining the rest of the position.