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Strategies & Market Trends : IRS, Tax related strategies--Traders -- Ignore unavailable to you. Want to Upgrade?

To: Bruno Galliano who wrote (488)	9/11/1998 1:43:00 PM
From: Colin Cody	Read Replies (1) \| Respond to of 1383

"Second, you can liquidate all positions and take 30 days off at the end of the year. That guarantees that all your losses will be allowed, and you can resume in January with a clean slate as far as wash sales are concerned." . My 1st. question: Does the above solution wipe out all wash sales for the prior 11 months January thru November if everything is liquidated and all trades finished before November 30. Yes this would have that effect. . Similarly if you changed the date above from "November 30" to any date in December it would "wipe out all wash sales", as long as you waited 31 days after that December date to purchase any stock previously held and subject to the wash sale rule. . If I choose to use the Mark to market method for my securities and give up my use of longterm capital gains for securities in my tax return, does this then also mean that I lose my longterm capital gains on property that is sold on contracts etc. You have a mistaken understanding as to MTM. MTM does not cause a taxpayer "to give up Long-Term capital gains" per se. In the example you cited, you would certainly continue reporting long-term gain with regards to the installment sale. . Other than very rare and peculiar circumstances would a Trader electing MTM see a Long-Term TRADE. . More generally and probably 99.9999% of the time a Trader electing MTM would convert Short-Term Gain and Losses into Ordinary Gains and Losses. . Colin