Thanks for bringing attention to these obscure, but important rules for TLH.
There's an exception to the 6-month exempt-interest dividend rule, such that it doesn't apply for funds that accrue dividends daily. Most Vanguard mutual funds (but not ETFs) fall into this category, so I'm more comfortable using them for TLH.
Thanks for bringing this up. I initially thought only the $1 money-market-like funds accrued daily, but I see now that there are a number of mid and long term funds that do as well, which makes the exception very relevant.
Thanks for bringing attention to these obscure, but important rules for TLH.
There's an exception to the 6-month exempt-interest dividend rule, such that it doesn't apply for funds that accrue dividends daily. Most Vanguard mutual funds (but not ETFs) fall into this category, so I'm more comfortable using them for TLH.
There's some more details on the bogleheads wiki: https://www.bogleheads.org/wiki/Tax_loss_harvesting#Fine_points_about_tax_loss_harvesting
Thanks for bringing this up. I initially thought only the $1 money-market-like funds accrued daily, but I see now that there are a number of mid and long term funds that do as well, which makes the exception very relevant.
Great explanation!