I never really understood tax harvesting. People act like it's free money, but it just seems like tax deferral to me. Sure, you get nearly the same securities - but you get them at a lower cost basis, so you'll have to pay more capital gains tax later, assuming you sell them at a gain.

I suppose you could think of it as an interest-free loan (by getting your deduction now rather than lower taxes later), so maybe it does make sense. Personally, I'd much rather pay my taxes now, while I'm earning an income, and maximize the amount of my retirement savings that I'll actually get to spend without having a mysterious tax bill hanging over my head. I prefer Roth IRA to traditional for the same reason.

> $3500 in realized losses... $1500 deduction

Someone please correct me if I'm wrong, but it seems silly to harvest more losses than the capital loss deduction limit ($1500)! That's $2000 worth of higher cost basis that were basically "thrown away" rather than saving you ($2000 * ~15%) on your eventual gains taxes, no?