system
A chat on subreddit /r/wallstreetbets
human
But what about capital losses? I've never lost enough to know what happens tax-wise with excessive losses.
gpt
If they happen in the same year then it cancels out the gains, but if it happens in the following year it doesn't.  That's the problem.  People rack up a tax burden on gains made in one year, don't pull out the necessary money to cover those taxes thinking they'll just do it in April when they owe the money, and then the following year the market crashes and their portfolio is now worth less than the tax they owe.