3 Ways to Rebalance Investments Without Paying Any Tax

Thanks to the the red-hot stock market we've enjoyed over the past several months, there's a good chance your portfolio is up from a year ago. This also means you'll probably owe some amount of capital gains tax this coming tax season if you were to sell any or all of your investments before the year is out.

Below, we'll discuss rebalancing and how to avoid any pesky tax charges in the process.

Rebalancing means bringing your investments back to your original asset allocation. For example, if you started the year with a portfolio comprising 60% stocks and 40% bonds, you might now be staring at a portfolio made up of 70% stocks and 30% bonds. This is mostly due to the stock market's outperformance this year -- as of this writing, the S&P 500 is about 25% higher than a year ago.

Source Fool.com