Quora Answer: Does a Gain in One Brokerage Account Balance a Loss in Another Brokerage Account for Tax Purposes?

The following is my answer to a Quora question: “Does a gain in one brokerage account, and a loss in another brokerage, balance each other out for tax purposes?”

Firstly, the accounts have to be owned by the same entity or natural person, the same tax resident.  If they are owned through different vehicles, and not directly, it does not apply.

Secondly, this applies to realised losses or gains, not paper loss or gains.

Finally, you cannot manipulate the system by selling the same instrument or derivative from one account, at a loss, and buying it at another account.  That transaction will be discounted.

The gains and losses, otherwise, will cancel each other out.