Noob question. Planning to open a taxable brokerage account to throw in index funds and a couple other things. How does rebalancing work? In my roth IRA there's no taxes so I can just exchange stocks for bonds over time (for example).

How do I rebalance the regular account? Do you just contribute more to the section that you want higher weight? Basically you can't "exchange" shares/funds you can only buy more (without paying taxes)?

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I never rebalance in my brokerage account. I do all rebalancing in my 401k. As you said I will direct future purchases in brokerage based on allocations but never sell, unless I absolutely need $ or if I have lots at a loss. My brokerage is entirely ITOT and IXUS.

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You don’t have to have dividends and capital gains withheld in your brokerage. You’ll get a 1099 at the end of the year with your taxable earnings. You can settle this come tax time, which is what I do. If you pay quarterly, or expect to be outside the IRS safe harbor rule, you may want to withhold or make estimated payments throughout the year.

But the question is about how to rebalance investments and nothing to do with 1099s or withholding. Everything you are saying is accurate but not applicable as far as I understand the question.

You are either tax impacted or just buy more of what you need more of and stop buying what you want less exposure of.

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