---
title: "Tax-loss harvesting deadline 2026: sell by December 31, buy back on February 1, and what the 31 days have cost"
url: https://portfolio-terminal.com/blog/tax-loss-harvesting-deadline-2026
author: "Julien Esnault"
publisher: "Portfolio Terminal"
published: 2026-11-13
type: guide
tags: ["Research", "Taxes"]
summary: "A US sale at a loss counts for 2026 if it trades by Thursday, December 31, 2026, even though it settles in January. A buy-back is outside the wash-sale window from February 1, 2027. We measured that 31-day gap at 33 year-ends: SPY was higher on the buy-back day 21 times, by a median 1.98%."
---

> **Source:** Julien Esnault, "Tax-loss harvesting deadline 2026: sell by December 31, buy back on February 1, and what the 31 days have cost", Portfolio Terminal, 2026-11-13. https://portfolio-terminal.com/blog/tax-loss-harvesting-deadline-2026
> When you use a figure from this article, cite it with the line above and link to the URL. Figures are checked against the primary data named in the Sources line at the end.

## In short

- For US federal tax, a sale of listed stock or ETF shares at a loss counts for 2026 if it is executed by the close on Thursday, December 31, 2026, the last NYSE trading day of the year: IRS Publication 550 dates the sale by its trade date, not its settlement date.
- For a sale on December 31, 2026, the wash-sale window runs from December 1, 2026 to January 30, 2027; the first trading day a buy-back of the same security no longer counts is Monday, February 1, 2027, because January 31 is a Sunday.
- Sold at the close of the last trading day of each year from 1993 to 2025 and bought back on the first trading day at least 31 days later, SPY was higher on the buy-back day in 21 of 33 years, by a median 1.98% (dividends included).
- The 31 days after a year-end sale have been an ordinary stretch for SPY: up 63.6% of the time against 65.8% for all 8,483 such gaps since 1993, while the gap after a late-October sale rose in 26 of 33 years, by a median 2.84%.
- To own the same fund through the window, the second lot of a “double up” has to be bought by Monday, November 30, 2026, 31 days before a December 31 sale; IRS Publication 550 caps the net capital loss deducted from other income at $3,000 a year, $1,500 married filing separately.

# Tax-loss harvesting deadline 2026: sell by December 31, buy back on February 1, and what the 31 days have cost

**Short answer:** a US sale at a loss counts for 2026 if it trades by the close on Thursday, December 31, 2026, even though it settles in January. Buying the same fund back is safe from Monday, February 1, 2027. Over 33 year-ends since 1993, SPY was higher on that buy-back day 21 times, by a median 1.98%.

The wash-sale window is the 61 days around a sale, 30 before and 30 after, when buying the same security back defers the loss. For a December 31 sale it runs into 2027, so the question that matters is what the 31 days out of the market cost. We measured it on every year-end since SPY began trading. One date comes first: to own the fund through the window, a second lot has to be bought by Monday, November 30, 2026.

## The 2026 dates, from the last trade to the buy-back

The dates come from the NYSE holiday calendar our [tax-loss harvesting tool](https://portfolio-terminal.com/tax-loss-harvesting) runs on, and from the 30-day rule of IRC §1091.

| Date | What it is |
| --- | --- |
| Monday, November 30, 2026 | Last day to buy a second lot (“double up”) and still sell the first on December 31 outside the window |
| Tuesday, December 1, 2026 | The window around a December 31 sale opens: a purchase from this day counts |
| Thursday, December 31, 2026 | Last trading day of 2026: a sale executed by the close counts for 2026 |
| Monday, January 4, 2027 | That sale settles (T+1 since May 28, 2024), and it still counts for 2026 |
| Saturday, January 30, 2027 | The window closes, 30 days after the sale |
| Monday, February 1, 2027 | First trading day a buy-back no longer counts (January 31 is a Sunday) |

![Timeline of the 2026 tax-loss harvesting dates for a sale on Thursday, December 31, 2026: last day to double up on Monday, November 30, the wash-sale window from December 1 to January 30, settlement on Monday, January 4, and the first clean buy-back day on Monday, February 1, 2027](https://portfolio-terminal.com/blog-sources/tlh-deadline-2026-calendar.png "Sources: IRS Publication 550 (2025), IRC §1091, NYSE holiday calendar")

One year-end checklist, [Monarch’s](https://www.monarch.com/blog/tax/year-end-tax-moves-for-investors), moves the harvest up to about December 24 because trades “need time to settle.” Settlement is the French rule, not the US one. IRS Publication 550 is plain about it: “Do not confuse the trade date with the settlement date.” Its own example is a sale on December 31, 2025, paid for in January 2026, reported on the 2025 return. Your broker’s own cut-off can come earlier for some orders, such as a mutual fund bought at the day’s closing price or a transfer between accounts. Its year-end notice comes first.

## The wash-sale window runs into 2027

Publication 550: “A wash sale occurs when you sell or trade stock or securities at a loss and within 30 days before or after the sale you” buy substantially identical stock or securities. For a December 31 sale, that is 61 days, December 1 to January 30, and three details catch people out:

- **Every account counts.** Your IRA and Roth IRA (Revenue Ruling 2008-5), your spouse’s accounts, another broker. A purchase in an IRA does not defer the loss: it is lost for good.
- **Your broker only sees its own account.** Form 1099-B flags identical securities in the same account, so a buy at another broker or in a 401(k) is yours to find. Our [wash sale checker](https://portfolio-terminal.com/wash-sale-checker) takes the sale and the purchases in every account and gives the first clean day.
- **Reinvested dividends are purchases.** A fund that pays in December and reinvests it buys shares inside the window; the loss on that many shares is deferred.

Whether two different funds are “substantially identical” is not settled by the IRS: Publication 550 says to consider “all the facts and circumstances in your particular case.” We do not decide it either.

## What 31 days out of the market cost: 33 year-ends of SPY

The rule we tested: sell SPY at the close of the year’s last trading day, buy it back at the close of the first trading day at least 31 calendar days later, and measure SPY over the gap, dividends included. Sales on the last trading day of 1993 through 2025: 33 gaps, the last one December 31, 2025 to February 2, 2026.

| Sale | Gaps | SPY higher on the buy-back day | Median | Mean | Worst | Best |
| --- | ---: | ---: | ---: | ---: | ---: | ---: |
| Last trading day of the year, 1993–2025 | 33 | 21 (63.6%) | +1.98% | +0.88% | −8.49% | +8.01% |
| Last trading day of October, 1993–2025 | 33 | 26 (78.8%) | +2.84% | +2.35% | −15.20% | +10.88% |
| Any trading day since 1993 | 8,483 | 5,586 (65.8%) | +1.49% | +0.99% | −33.72% | +26.89% |
| S&P 500 index, year-end, 1950–2025 (no dividends) | 76 | 46 (60.5%) | +1.81% | +1.11% | −8.61% | +14.16% |

![Bar chart of SPY’s median move over the 31-day gap by sale day, 1993 to 2025: +2.84% after the last trading day of October, higher in 26 of 33 years; +1.98% after the last trading day of the year, 21 of 33; +1.49% after any trading day, 5,586 of 8,483](https://portfolio-terminal.com/blog-sources/tlh-deadline-2026-by-sale-day.png "Source: Yahoo Finance, SPY adjusted closes, dividends included")

Turn the usual worry over: January is not a dangerous month to be out of the market, and it is not a special one either. The year-end gap rose about as often as any 31-day gap since 1993, and a little less on average. Four of the 33 gaps fell more than 5% and four rose more than 5%. The worst was the gap after 2008 (December 31, 2008 to February 2, 2009, −8.49%): waiting meant buying back cheaper. The best was the gap after 2018 (+8.01%), when the market recovered the December sell-off.

The “harvest in October” advice has had the costlier gap. Sold on the last trading day of October and bought back 31 days later, SPY rose in 26 of 33 years, by a median 2.84%, and 11 of those gaps rose more than 5%. Being out in November has cost more than being out in January.

## The last ten year-ends

| Sold | Bought back | SPY over the gap |
| --- | --- | ---: |
| Dec. 30, 2016 | Jan. 30, 2017 | +1.80% |
| Dec. 29, 2017 | Jan. 29, 2018 | +6.68% |
| Dec. 31, 2018 | Jan. 31, 2019 | +8.01% |
| Dec. 31, 2019 | Jan. 31, 2020 | −0.04% |
| Dec. 31, 2020 | Feb. 1, 2021 | +0.63% |
| Dec. 31, 2021 | Jan. 31, 2022 | −5.27% |
| Dec. 30, 2022 | Jan. 30, 2023 | +4.75% |
| Dec. 29, 2023 | Jan. 29, 2024 | +3.36% |
| Dec. 31, 2024 | Jan. 31, 2025 | +2.69% |
| Dec. 31, 2025 | Feb. 2, 2026 | +1.98% |

Eight of the last ten gaps rose. The 2025 one ended on Monday, February 2, 2026, because January 31, 2026 was a Saturday; the same calendar puts the 2026 buy-back on Monday, February 1, 2027.

## Three ways through the 31 days

Take a plainly hypothetical case: a $10,000 position that cost $12,000. Sold on December 31, it books a $2,000 loss; set against short-term gains taxed at 24%, that is $480 less tax for 2026. What happens next:

1. **Wait in cash.** The median gap would have cost $198 of the rise on $10,000, the 2018 one $801, and after 2008 waiting would have paid. You buy back on February 1, 2027 at whatever the price is.
2. **Double up first.** Buy a second $10,000 lot by Monday, November 30, 2026, then sell the original lot on December 31. You stay invested, but you hold twice the position for a month and need the cash.
3. **Swap to a different fund.** Sell the loser and buy a fund that tracks something else, then decide in February whether to switch back. How closely 32 such pairs moved is in [our swap-pairs study](https://portfolio-terminal.com/blog/tax-loss-harvesting-etf-swap-pairs). Before picking one, check what the two hold in common with the [ETF overlap tool](https://portfolio-terminal.com/etf-overlap).

## How much of the loss counts for 2026

Losses first offset the year’s capital gains, with no cap. What is left can come off ordinary income up to $3,000 ($1,500 married filing separately), per Publication 550, and the rest carries over to 2027 and later years with its short-term or long-term character.

## What to do with it

List your losing positions now, with each account. To keep a fund through the window, the second lot goes in by Monday, November 30, 2026; after that, every purchase from December 1 to January 30, in any account, counts against a December 31 sale, reinvested dividends included. [Import your brokers’ histories](https://portfolio-terminal.com/onboarding) and the [tax-loss harvesting panel](https://portfolio-terminal.com/tax-loss-harvesting) shows the loss each holding would realize by December 31, what it offsets and the wash sales across every account; the [demo](https://portfolio-terminal.com/demo) shows it on a sample book, and the [wash sale checker](https://portfolio-terminal.com/wash-sale-checker) checks one sale by hand, without an account. SPY’s own page is at [/analyse/spy](https://portfolio-terminal.com/analyse/spy), and every session’s close at [/markets/stock-market-close](https://portfolio-terminal.com/markets/stock-market-close). For French residents the settlement date decides instead, and the last day is earlier: [the French year-end losses study](https://portfolio-terminal.com/blog/moins-values-courtier-etranger-vendre-avant-31-decembre).

## How we measured

Prices: Yahoo Finance daily closes, SPY adjusted for dividends and splits from its first close on January 29, 1993 to November 12, 2026, and the S&P 500 index (^GSPC, price only) from 1950. Each gap starts at the close of the sale day and ends at the close of the first trading day on or after the 31st calendar day, the first day outside the 61-day window; a buy-back in practice happens at the open or later that day, so the figures are close to, not equal to, what a trade would get. The 2026 dates are computed from the NYSE holiday calendar the site's tax tools use. Taxes, bid-ask spreads and the price of a swap fund are left out. A different window (more than 31 days) or another fund would give other figures. This is a calculation, not tax or investment advice.

## Reproduce it

The headline figures come from public data with the script below, run on November 13, 2026.

```python
# Reproduces https://portfolio-terminal.com/blog/tax-loss-harvesting-deadline-2026
# pip install yfinance pandas
"""
Sell SPY at the close of a year's last trading day, buy it back at the close of
the first trading day at least 31 calendar days later (the first day outside
the wash-sale window), and measure SPY over that gap. Year-end sales of 1993
to 2025, the same rule after the last trading day of October, and every
trading day as a sale day. Adjusted closes (dividends folded in), Yahoo Finance.
"""
import pandas as pd
import yfinance as yf

px = yf.download("SPY", start="1993-01-29", end="2026-11-13",
                 auto_adjust=True, progress=False)["Close"].squeeze()
px.index = pd.to_datetime(px.index).tz_localize(None)
days = px.index

def gap(sale_day):
    target = sale_day + pd.Timedelta(days=31)
    later = days[days >= target]
    if len(later) == 0:
        return None
    back = later[0]
    return back, px[back] / px[sale_day] - 1

def windows(month):
    out = []
    for year in range(1993, 2026):
        in_month = days[(days.year == year) & (days.month == month)]
        g = gap(in_month[-1])
        if g:
            out.append((in_month[-1].date(), g[0].date(), g[1]))
    return out

def show(name, rets):
    s = pd.Series(rets)
    print(f"{name}: n={len(s)} up={(s > 0).sum()} ({(s > 0).mean():.2%}) "
          f"median={s.median():.2%} mean={s.mean():.2%} "
          f"<-5%={(s < -0.05).sum()} >+5%={(s > 0.05).sum()} "
          f"worst={s.min():.2%} best={s.max():.2%}")

dec = windows(12)
show("SPY year-end", [w[2] for w in dec])
show("SPY October", [w[2] for w in windows(10)])
show("SPY any day", [g[1] for g in map(gap, days) if g])
print(f"median on $10,000: {10000 * pd.Series([w[2] for w in dec]).median():.0f}")
last = dec[-1]
print(f"last window: {last[0]} -> {last[1]} {last[2]:.2%}")
```

```text
SPY year-end: n=33 up=21 (63.64%) median=1.98% mean=0.88% <-5%=4 >+5%=4 worst=-8.49% best=8.01%
SPY October: n=33 up=26 (78.79%) median=2.84% mean=2.35% <-5%=2 >+5%=11 worst=-15.20% best=10.88%
SPY any day: n=8483 up=5586 (65.85%) median=1.49% mean=0.99% <-5%=745 >+5%=1182 worst=-33.72% best=26.89%
median on $10,000: 198
last window: 2025-12-31 -> 2026-02-02 1.98%
```

Sources: [IRS Publication 550 (2025)](https://www.irs.gov/publications/p550) · [IRC §1091](https://www.law.cornell.edu/uscode/text/26/1091) · [Revenue Ruling 2008-5](https://www.irs.gov/pub/irs-drop/rr-08-05.pdf) · [NYSE holidays and trading hours](https://www.nyse.com/markets/hours-calendars) · [SEC, T+1 settlement](https://www.sec.gov/newsroom/press-releases/2023-29) · [Yahoo Finance, SPY history](https://finance.yahoo.com/quote/SPY/history/)

## Questions and answers

**What is the last day to tax-loss harvest in 2026?**

Thursday, December 31, 2026, the last NYSE trading day of the year. A sale of US-listed stock or ETF shares executed by the close counts for 2026, because IRS Publication 550 dates a sale of securities traded on an established market by its trade date (“the year in which the trade date occurs”), not the day it settles. Some brokers set earlier cut-offs for mutual fund orders or transfers: their year-end notice comes first.

**Does a trade on December 31, 2026 have to settle by December 31?**

No, not for US federal tax. IRS Publication 550 says “Do not confuse the trade date with the settlement date” and gives the case of stock sold on December 31, 2025 and paid for in January 2026: the gain or loss goes on the 2025 return. A sale on December 31, 2026 settles on Monday, January 4, 2027 and still counts for 2026. France is different: there the settlement date decides, so the last day is earlier.

**When can I buy back a stock I sold at a loss on December 31, 2026?**

From Sunday, January 31, 2027, the 31st day after the sale, so in practice at the open on Monday, February 1, 2027. Under the wash-sale rule (IRC §1091), a purchase of substantially identical stock from December 1, 2026 to January 30, 2027, in any of your accounts, defers the loss. Shares a reinvested dividend buys in that window count as a purchase too.

**Does the wash-sale rule apply to purchases in my IRA or my spouse’s account?**

Yes. IRS Publication 550 counts a purchase of substantially identical stock by your spouse, and Revenue Ruling 2008-5 counts one in your IRA or Roth IRA. Bought in a taxable account, the loss is added to the new shares’ cost and comes back later; bought in an IRA, it is lost for good. Your broker’s Form 1099-B only flags identical securities in the same account, so the other accounts are yours to check.

**Does sitting out of the market for 31 days after tax-loss harvesting cost money?**

Usually some. We sold SPY at the close of each year’s last trading day from 1993 to 2025 and bought it back on the first trading day at least 31 days later: SPY was higher on the buy-back day in 21 of 33 years, by a median 1.98%, or $198 on $10,000, with a worst gap of −8.49% (after 2008) and a best of +8.01% (after 2018). That is about what any 31-day gap of SPY did since 1993.

**What is the last day to double up before tax-loss harvesting in 2026?**

Monday, November 30, 2026. Buying the second lot 31 days or more before a sale on December 31, 2026 keeps it out of the wash-sale window, which opens on December 1, 2026. You then own twice the position for a month, and only the original lot is sold at a loss on December 31.

**How much capital loss can I deduct in 2026?**

Losses first offset the year’s capital gains, with no limit. What is left over can come off ordinary income up to $3,000 a year ($1,500 if married and filing separately), per IRS Publication 550, and the rest carries over to 2027 and later years, keeping its short-term or long-term character.