What is systematic loss harvesting worth before your exit?
A harvested loss is worth the tax it removes from a gain you actually realize, so the value depends on how much gain lies ahead, your federal and state rate on it, and how many losses the approach can generate.
An owner heading toward a sale usually carries two tax problems at once: the gain on the business itself, and the gains that keep arriving as concentrated positions and proceeds get diversified afterward. Systematic tax-loss harvesting works on both. A long-only account harvests the losses that ordinary market movement creates; a long/short extension (130/30 or 200/100) adds a short book that can generate materially more harvestable loss per dollar invested, at higher cost and complexity.
This calculator models what each approach could realize in capital losses over ten years, and what those losses would be worth against your gains at your 2026 federal and 2025 state marginal rates. It exists to size the opportunity, not to recommend a strategy; that conversation depends on facts a calculator cannot hold.
Enter your filing status, state and ordinary income, the capital gains you plan to realize each year, and what you plan to invest at the start and add each year.
The calculator estimates the capital losses each approach could harvest year by year, from long-only to the two long/short versions.
It works out your blended federal and state marginal rate on the gains those losses would offset, including the net investment income tax where it applies.
It values the losses only up to the gains you entered and carries the rest forward, so a loss counts once there is a gain to absorb it.
Updated September 2026
Updated for the 2026 tax year and moved to its new address. Federal brackets are the 2026 figures; state brackets are each state’s 2025 schedule. The tax saved now counts a harvested loss only once a gain you entered absorbs it, and shows the rest as losses not yet used.
A worked example
A married couple filing jointly in California with $750,000 of ordinary income, $400,000 of capital gains to offset every year, $500,000 invested at the start and $250,000 added each year, arriving in equal monthly amounts.
Hypothetical result
Federal long-term
20.0%
Stacked on ordinary income
State
11.3%
Long-term; short-term 11.3%
Net investment income tax
3.8%
Where income is over the threshold
Ordinary rate
51.8%
Federal, state and NIIT, for the short-term share
Long only · blended
35.1%
All losses long-term
130/30 · blended
40.9%
35% short-term at ordinary rates
200/100 · blended
43.4%
50% short-term at ordinary rates
Cumulative capital losses harvested, by year and approach.
Year
Long only
130/30
200/100
Year 1
$70,285
$128,632
$236,631
Year 3
$206,227
$419,014
$891,759
Year 5
$374,946
$829,230
$1,934,622
Year 7
$583,334
$1,383,872
$3,468,290
Year 10
$972,168
$2,521,017
$6,883,842
Cumulative tax saved, counting each loss only once the gains entered absorb it.
Year
Long only
130/30
200/100
Year 1
$24,637
$52,628
$102,759
Year 3
$72,289
$171,436
$387,254
Year 5
$131,430
$339,272
$734,662
Year 7
$204,477
$566,198
$1,082,069
Year 10
$340,776
$1,022,338
$1,603,180
In this example the $400,000 of gains entered each year absorbs every loss long-only harvests; the 130/30 approach outruns them from year 10 and the 200/100 approach from year 4, leaving about $22,275 and $3,192,083 of losses not yet used at year ten.
The calculator
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Hypothetical result
Losses each approach could harvest
Cumulative capital losses harvested, by year and strategy. Each dollar of harvested loss can absorb a dollar of realized capital gain.
Year
Long only
130/30
200/100
Tax dollars those losses could save
Cumulative tax savings at your blended marginal rate, counting each loss only once the gains entered above absorb it. Losses beyond a year’s gains carry forward to later years.
Long only
130/30
200/100
Year
Long only
130/30
200/100
This piece is general education, not individual advice.
Nothing here is individual tax, legal, or investment advice, and no outcome shown is certain. Results are hypothetical, vary with each use and over time, and are not a prediction of what any account will realize. Whether any of these strategies fits your situation depends on your holdings, cost basis, liquidity, and risk tolerance. Aspirean Wealth, LLC is an SEC-registered investment adviser; registration does not imply a certain level of skill or training.
Assumptions and limitations
Criteria and methodology. Loss-harvesting rates are derived from published third-party simulations of tax-managed strategies (averages across 25 simulated portfolios over ten-year horizons, with tax savings reinvested), fitted so each strategy’s ten-year cumulative losses equal the published endpoints of 50% (long only), 145% (130/30), and 433% (200/100) of contributed capital. Additions are modeled as arriving monthly and each dollar harvests on its own schedule from its arrival date. Tax rates use the 2026 federal schedules (Rev. Proc. 2025-32) with the standard deduction for your filing status, the 3.8% net investment income tax on investment income above $250,000 of modified adjusted gross income for joint filers, $200,000 for single filers and heads of household and $125,000 for married couples filing separately, and each state’s 2025 schedule including capital-gains exclusions, preferential caps, and surtaxes. The rates are the average marginal rates across the capital gains entered, stacked on top of ordinary income. Short-term losses are assumed to be 0% of the total for long-only, 35% for 130/30, and 50% for 200/100, valued at ordinary rates, which treats them as offsetting short-term gains; if the gains you enter are long-term, short-term losses are worth only the long-term rate, and the 130/30 and 200/100 figures would be lower. Each year’s tax saved is capped at the capital gains entered for that year: losses beyond them carry forward and are valued in the first later year whose gains have room, and any left at year ten are shown as losses not yet used, with no value assigned. Not modeled: strategy costs (management fees, financing and borrow costs and tracking error, all materially higher for long/short extensions; they reduce these figures and can exceed the additional tax a long/short version saves), the federal deductibility of state taxes, local income taxes, the alternative minimum tax, the annual deduction of up to $3,000 of net capital loss against ordinary income, and the lower cost basis harvesting leaves behind.
Results vary. Every figure changes with each input you enter, and the same inputs would produce different figures as tax law and markets change. Actual harvesting depends entirely on market behavior that no one controls. The tax tables are a point in time: the 2026 federal schedules and each state’s 2025 schedule, applied unchanged to all ten years, with the same income, gains and additions every year. Results vary with each use and over time.
Investments considered. The calculator compares three strategy types, not specific products: a long-only tax-managed portfolio and two long/short extensions of it, 130/30 and 200/100, which add borrowed long positions and short sales. It does not consider, select or recommend any specific investment, fund, manager or portfolio, and it does not use Aspirean’s portfolios. Other investments and approaches not considered may have similar or superior characteristics.
Hypothetical. The outcomes shown are hypothetical. The loss curves come from simulated results, which do not reflect actual trading, and nothing shown is a prediction of what any account will realize. Real results will differ, possibly by a lot, and losses harvested in any single year can be far below these averages, including zero.
Definitions
Realized loss
A loss that counts for tax because the investment was actually sold, as opposed to a decline on paper.
Cost basis
What you paid for an investment, adjusted over time. Gain or loss is the sale price minus the basis.
Wash sale
A sale at a loss followed, within 30 days either side, by a purchase of the same or a substantially identical security; the loss is postponed.
Capital loss carryforward
Net loss you could not use this year, carried to later years to offset future gains.
Long/short (130/30, 200/100)
A portfolio that holds more stock than its capital by borrowing, and sells other stocks short, to create more harvestable losses while keeping roughly the same market exposure.
Frequently asked questions
What is tax-loss harvesting?
It is selling an investment that has fallen below what you paid, realizing the loss for tax purposes, and buying something similar so the portfolio stays invested. The realized loss offsets capital gains taken elsewhere, and a limited amount of ordinary income. Done systematically across many positions, it turns ordinary market movement into a supply of losses that can absorb gains from a sale or a rebalance.
Is a harvested loss worth anything if I have no gains to offset?
Very little at first. Beyond a small annual deduction against ordinary income, a harvested loss does nothing until there is a realized gain for it to absorb. Unused losses carry forward indefinitely, so the value is deferred rather than lost, but a household that rarely realizes gains may wait a long time to collect it. The calculator counts a loss only once a gain you entered absorbs it, and is most useful when a sale, a diversification plan or steady rebalancing will produce gains.
What is the wash sale rule?
If you buy the same or a substantially identical security within 30 days before or after selling it at a loss, the loss is disallowed for now and added to the cost of the new position. The rule looks across your accounts, including IRAs and a spouse’s accounts. Harvesting programs avoid it by buying a similar but not identical holding, then waiting out the window.
Does tax-loss harvesting save tax or only defer it?
Mostly it defers. Harvesting lowers the cost basis of what you own, so more gain is waiting when you eventually sell. The deferral is still worth having, because the tax money stays invested in the meantime, and it becomes a permanent saving if the holdings pass at death with a stepped-up basis or go to charity. A loss used against short-term gains or ordinary income also saves at a higher rate than the later gain costs.
What are 130/30 and 200/100 strategies?
They are long/short versions of a harvesting account. Alongside the ordinary long holdings, the account borrows to buy more stocks and sells others short, keeping overall market exposure near that of the long-only portfolio. The extra positions create more losses to harvest per dollar invested, at the price of higher fees, financing cost, complexity and tracking risk. The calculator shows the harvesting difference; the cost and risk are a conversation.
Meet with us
Numbers this size deserve a second set of eyes.
If the ten-year figures are material to your exit, the right next step is a conversation about whether the strategy fits, not a bigger spreadsheet.
