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ETF Specialist

Sell Underperforming Funds With Large Personal Unrealized Capital Gains?

Guidelines to help determine whether to stay put or sell.

Note: This article is part of Morningstar's February 2015 Tax Relief Week special report. An earlier version of this article appeared on Feb. 4, 2015.

The Scenario
Over the past two years, U.S. equities have delivered very strong returns. The one downside is that in both years, you received large capital gains distributions from your U.S. equity fund investment. If you had no personal loss carryforwards, you had to cut a check to Uncle Sam when you filed your 2013 tax returns and will have to do so again for your 2014 taxes.

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