1. United States
2. Calif.
3. Letter

I am writing to urge you to support legislation that modernizes the federal capital loss deduction by increasing—and permanently indexing—the $3,000 annual limit on capital losses that may be deducted against ordinary income. The current $3,000 limit has remained essentially unchanged since 1978. Over nearly five decades, inflation has dramatically eroded its value. A deduction that may have been reasonable in the late 1970s is no longer adequate for today's taxpayers or today's investment environment. While taxpayers may continue to carry forward unused losses indefinitely, the outdated annual limitation often forces families to wait years—or even decades—to realize the full tax benefit of legitimate investment losses. The tax code appropriately allows capital losses to offset capital gains without limit, but when losses exceed gains, taxpayers are restricted to deducting only $3,000 of ordinary income each year. This arbitrary cap fails to recognize the realities of modern investing, retirement planning, and market volatility. I encourage Congress to pass legislation similar to the Capital Loss Inflation Fairness Act, which would raise the deduction and index it to inflation so that taxpayers are not forced to return to Congress every few decades for another adjustment. Such a reform would make the tax code fairer, simpler, and more consistent with the inflation adjustments already applied to numerous other tax provisions. This proposal is not a tax loophole or a special benefit. It simply restores purchasing power that has been lost over time and ensures taxpayers receive equitable treatment when they incur genuine investment losses. I respectfully ask you to support and advocate for legislation that updates the capital loss deduction and indexes it for inflation going forward. Tax laws should evolve with the economy, and this long-overdue reform would provide meaningful relief to millions of responsible investors and retirees. American’s need this relief, especially those that have loss carryovers that will never be able to be used in totality given the 3000.00 cap. Thank you for your consideration and for your service to our country.