Linda, if they sell the bought back batch, and don't buy back for 30 days, the NET loss may be realized. I'll reprint the example from Lasser's. Your example is addressed in step 3.
EXAMPLE:
1. You bought common stock of Appliance Co. for $10,000 in 1981. On June 27, 1996, you sold the stock for $8,000, incurring a $2,000 loss. A week later, you repurchased the same number of shares of Appliance stock for $9,000. Your loss of $2,000 on the sale is disallowed because of the wash-sale rule. The basis of the new lot becomes $11,000. The basis of the old shares ($10,000) is increased by $1,000, which is the excess of the purchase price of the new shares ($9,000) over the selling price of the old shares ($8,000).
2. Assume the same facts as in Example 1 except that you repurchase the stock for $7,000. The basis of the new lot is $9,000. The basis of the old shares ($10,000) is decreased by $1,000, which is the excess of the selling price of the old shares ($8,000) over the purchase price of the new shares ($7,000).
3. Assume that in February 1996 you sell the new lot of stock acquired in Example 1 above for $9,000 and do not run afoul of the wash-sale rule. On the sale, you realize a loss of $2,000 ($11,000 - $9,000).
So you see, you can always eventually realize your net loss if you sell and don't buy back for 30 days. Hopefully your net is a gain. Hope this helps. |
