What is a wash sale?<\/p>\n
Some of you may be aware of the potential benefits of selling stock\/securities for a loss. (The loss may be used to write-off certain income – I posted about this earlier in the week.)<\/p>\n
The IRS was concerned that people would sell a stock to create such a loss – and then immediately re-purchase the very same stock.<\/p>\n
Essentially, people would be maintaining their position in this stock, while creating this “artificial” loss to take advantage of.<\/p>\n
This is called a “wash sale.”<\/p>\n
In response, the IRS established the “wash sale rule”:<\/p>\n
You cannot purchase the same stock (that you sold for a loss) 30 days before or 30 days after you sold it.<\/p>\n
If you do purchase it, the loss will be disallowed until a later date.<\/p>\n
There are potential options to work around this, but if you are selling stock for a loss, you definitely need to be mindful of this rule.<\/p>\n","protected":false},"excerpt":{"rendered":"
What is a wash sale? Some of you may be aware of the potential benefits of selling stock\/securities for a loss. (The loss may be used to write-off certain income – I posted about this earlier in the week.) The IRS was concerned that people would sell a stock to create such a loss – […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"yoast_head":"\n