Income Taxes and Record Keeping ( tax ) Message Board

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Strategies & Market Trends : Income Taxes and Record Keeping ( tax )

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To: Kaye Thomas who wrote (2283)	9/14/1999 6:50:00 PM
From: Richard Forsythe	Read Replies (1) of 5810

Hi Kaye, Was wondering if selling BRK.B and buying BRK.A would be covered as a wash sale of the Bs. Your wonderful site says: Sometimes people want to play games with this rule. You may own stock in a company that's about to be acquired by Bigco. Just before the merger you sell your stock and buy shares of Bigco ? shares you would have received in the merger if you hadn't sold your original shares. If you're thinking this isn't a wash sale because you bought shares in a different company, you're wrong. The rule about stock in different companies not being substantially identical isn't hard and fast. If two different stocks are linked together in such a way that any change in the price of one will be reflected in the price of another, they're likely to be treated as substantially identical securities for purposes of the wash sale rule. This suggests that the sell B/buy A would NOT avoid wash rules. Correct? What are the references in the tax code on this? Richard

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