Final answer:
Carrying over capital losses allows taxpayers to use unused losses from one year to offset gains in future years. Long-term capital losses have different tax implications and can be used to offset long-term capital gains and ordinary income. Tax strategies related to capital gains and losses involve careful timing and techniques to maximize tax benefits.
Step-by-step explanation:
Carrying over capital losses refers to the practice of using unused capital losses from one tax year to offset capital gains in future tax years. When a taxpayer carries over a capital loss, its character remains the same as the original loss (either short-term or long-term).
Long-term capital losses generally have different tax implications than short-term losses. In the United States, long-term capital losses can be used to offset long-term capital gains, and any excess losses can be used to offset up to $3,000 of ordinary income per year.
Tax strategies related to capital gains and losses involve maximizing tax benefits by carefully timing the realization and offsetting of gains and losses. This can include techniques such as tax-loss harvesting and tax-efficient asset location.