Après-Tax
Work the numbers.
A calculator for the arithmetic of after-tax return.
10 worked lessons. Enter your own figures and watch the arithmetic.
Après-Tax
A calculator for the arithmetic of after-tax return.
10 worked lessons. Enter your own figures and watch the arithmetic.
Educational illustration of a mechanism. Hypothetical model output, not advice, and not a record of any actual result.
Lesson 01
Time-weighted strips out deposit and withdrawal timing; money-weighted keeps it, grading the cash-flow decisions too.
Lesson 02
Interest at the ordinary rate; qualified dividends and realized gains at the long-term rate. Simplified: gains and losses net across the window, not by tax year.
Lesson 03
Nothing is realized during the hold, so pre-liquidation equals the gross return. The year-10 sale taxes the embedded gain at the 24% long-term rate, the correct character for a decade-long hold.
Lesson 04a
Harvesting lowers cost basis, so assuming prices appreciate, the gain at sale is bigger by exactly the loss taken. What that loss is worth is set by the net gain it absorbs, not by its own character: a short-term loss meeting only long-term gains is used at the long-term rate. The gap is that rate less the rate paid at sale, so the long side runs from a wash up to the full spread, and never below one.
Lesson 04b
Covering at a loss and re-shorting higher raises proceeds, so assuming prices fall, the gain at the final cover is bigger. A short’s gain is always short-term (26 CFR §1.1233-1(a)(3)). An investor pays at the short-term rate no matter what the loss offsets. At best there is no gap to keep, and offsetting long-term gains makes it negative.
Lesson 04c
| Loss absorbed by | Repaid short-term | Repaid long-term | Repaid never |
|---|---|---|---|
| Net short-term | wash | positive | positive |
| Net long-term | negative | wash | positive |
| No net gains | eventual | eventual | eventual |
A loss is worth the rate of whatever absorbs it, not the rate its own character implies. Netting under 26 U.S.C. §1222 is mandatory and ordered: short-term meets short-term first, long-term meets long-term first, and only the two survivors are crossed, so a harvested loss never meets a gross gain. With no net gains left, §1211(b) allows only $3,000 a year against ordinary income and the remainder carries forward with its character intact. “Never” is a basis step-up at death (§1014) or a gift of the appreciated position to charity (§170).
Lesson 05
Measured pre-liquidation: the sleeve pays tax on its deferred gain only at sale (Lesson 03).
Lesson 06
A harvested loss is worth the rate of the gain it offsets: nothing, long-term, or short-term, plus state. 2025 rates, single filer.
Lesson 07
Wash Sale: Repurchasing substantially identical securities within 30 days of sale disallows the loss today but adds it to the replacement cost basis, keeping the basis at $100,000 and avoiding extra tax at sale. The holding period tacks (IRC §1223).