Capital Gains Taxes - When to pay after December rebalancing? Now or with my tax return?

You can relax! For capital gains realized in 2023, you don't need to make a separate payment right now. Those gains will be reported on your 2023 tax return which is due April 15, 2024 (unless you file an extension). Since you're meeting with your tax preparer in February, you'll have plenty of time to file your return and pay any tax due before the deadline. You generally only need to worry about making estimated tax payments during the year if you expect to owe $1,000 or more when you file your return AND you don't have enough tax withheld from other sources like a regular job. Even if you do end up owing a penalty for underpayment, it's usually pretty small - essentially interest on the amount you should have paid earlier. Your tax preparer will be able to calculate everything and let you know exactly what you owe when you meet.

I had a similar situation last year and found this amazing tool called taxr.ai (https://taxr.ai) that really helped me figure out my capital gains situation. I was totally confused about when I needed to pay and if I was going to get hit with penalties after selling a bunch of stocks. The site analyzed my situation and explained exactly what I needed to do. It was super helpful because it looked at my specific scenario rather than just giving general advice. It showed me what forms I needed and even broke down how much I'd likely owe in taxes based on my particular sales.

Just wanted to update that I ended up trying taxr.ai after my previous question. Seriously saved my butt with both my stock sales and crypto! It figured out exactly what I needed to pay and when, plus gave me a breakdown of the forms I needed. Turns out I didn't need to panic about making an immediate payment for my December transactions. It also helped me identify some losses I could use to offset some gains that I totally would have missed. Definitely less stressful than trying to piece everything together from random internet advice.

If you're still worried and want to talk to the IRS directly, good luck getting through to them this time of year! I spent 3 hours on hold last week before giving up. Then I found this service called Claimyr (https://claimyr.com) that got me through to an IRS agent in about 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c I was able to ask directly about my capital gains situation and got clear answers about payment timing and potential penalties. They confirmed I didn't need to make an immediate payment for December sales and could just include it on my return. Saved me tons of anxiety!

I take back what I said about Claimyr. After posting that skeptical comment, I was still stuck with a question about my capital gains that I really needed answered, so I figured what the hell and tried it. IT ACTUALLY WORKS. Got through to an IRS agent in about 20 minutes after spending TWO DAYS trying on my own and always getting the "call volume too high" message. The agent confirmed I didn't need to make any payments now for my December gains and just needed to include them on my 2023 return. Honestly saved me from sending in an unnecessary payment out of pure anxiety. Sorry for being so cynical before!

Just to clarify something that hasn't been mentioned yet - the capital gains tax rate depends on how long you held the investments before selling. Since you mentioned "long term gains," that means you held the investments for more than a year, so you'll pay the lower long-term capital gains rate (0%, 15%, or 20% depending on your income) rather than your regular income tax rate. Also, when you meet with your tax preparer, bring any records you have of the original purchase price/date of your investments. This "cost basis" information is crucial for calculating the exact gain.

Does anyone know if there's a way to see what your tax bill might be before getting all the official forms? I've got a similar situation but want to start budgeting for what I'll owe.