WASH Sale, Rande a note about what you said:
<<and as long as you hold it for 31 days you are entitled to the tax loss, otherwise it is considered a wash sale and you are not.>>
It should be noted that the last words you wrote "you are not" mean "you are not" AT THAT TIME, not, however, "you are not" EVER. There is a lot of misunderstanding of the wash sale rule but if you run afoul of the rule by taking a wash sale, the loss you incur is added to any subsequent transaction in that security. In which case the "loss" is taken LATER, but you still can take the loss, just not at that time.
For detailed discussion of this rule, see some of the tax and investing threads, i.e.,
Subject 5727
And see also Tracy Byrnes fine articles in thestreet.com
thestreet.com
Note especially this section:
<<But there's still one way to claim a loss if you buy back a security before the 30-day holding period is up: You can add the loss to the basis of the repurchased security. Let's say you buy a share at $10, sell it at $8, and buy it back within 30 days at $9. You can add the original $2 loss to your new cost basis, which is now $11. If the stock rises and then you sell, let's say at $12, your taxable gain is only $1. >>
I apologize for any repetition here, but I keep running into traders who have not fully digested all the intricacies of the wash sale rule. |
