Setting off Long-term Equity Loss

Vikalp Agarwal wants to know if we can set off long term equity loss against debt or any other instruments


Can long-term capital loss from stocks or equity mutual funds be set off against long-term capital gains from debt funds or instruments?
- Vikalp Agrawal

Long-term capital loss can be set off only against long-term capital gain. Since long-term capital gain of equity (including equity mutual funds) is exempt from tax, a long-term capital loss arising from equity is not allowed to be set off, neither from long-term capital gain of debt nor from long-term gain of equity.

Long-term capital loss from equity cannot be set off but long-term capital loss from debt can be set off against long-term capital gain of debt. Here again, it cannot be set off against long-term capital gains of equity since they are exempt from tax.



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