DIVIDENDS AND TAX
Rebalance
Hi guys, I am considering of just maintaining just 1 ETF instead of having 3. I only held those ETFs for less than 12 months so if I rebalance, would I be taxed more? TIA
Ralph Raymond Liguid
12 July 2024
1 Comments
2 months ago
Hi Ralph.
If you sell those ETFs and they had capital gains, you’d have to pay tax on those gains. Yet if you held them longer than 12 months, you will generally only need to pay tax on 50% of the capital gain.
So yes, you’ll be taxed more than if you wait. However, it’s also worth thinking about the performance of those funds. If you believe they may perform worse than your single ETF, then it may not be worth keeping them for the extra time (depending on how long it is).
Hope that helps.
Dave
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