Personal Resource Center

What to know about tax loss harvesting

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Tax-loss harvesting can help reduce your exposure to costly short-term capital gains taxes, which are taxed as ordinary income.

What are the pros and cons of tax-loss harvesting?

While tax-loss harvesting might appear simple, it really has several moving parts beyond the gains and losses of investments. It's best to know the pros and cons so you can speak to your tax and investment professionals to see if tax-loss harvesting is right for you.


  • Potential reduction in capital gains tax liability.
  • The ability to make every part of your portfolio—winning and losing positions—work in your favor.
  • Ability to use sale proceeds to diversify and rebalance your portfolio to your target asset allocation.



Should you use tax-loss harvesting?

While this strategy can potentially help you both reduce your tax bill and exposure to risk, taxes shouldn't be the only reason for a financial decision. The best investment and tax strategies involve a regular review of your portfolio with your financial advisor to ensure that your investments are in sync with both your short-term and long-term goals.Talk with your Synovus financial advisor to discuss if tax-loss harvesting is an option for you.

Important disclosure information

This content is general in nature and does not constitute legal, tax, accounting, financial or investment advice. You are encouraged to consult with competent legal, tax, accounting, financial or investment professionals based on your specific circumstances. We do not make any warranties as to accuracy or completeness of this information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of this information.

  1. Tax Policy Center, "Elements of the U.S. Tax System: How are capital gains taxed?" updated May 2020, accessed November 30, 2021. Back
  2. IRS.gov, "Publication 550 (2020), Investment Income and Expenses," accessed November 30, 2021. Back
  3. IRS.gov, "Publication 550 (2020), Investment Income and Expenses," accessed November 30, 2021. Back
  4. Ryan Furhmann, "Cost Basis 101: How to Understand It," Investopedia, updated August 29, 2021, accessed December 1, 2021. Back