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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: Peter V who wrote (35402)	5/8/1999 10:01:00 PM
From: Sword	Read Replies (1) \| Respond to of 122087

<OT-Wash Sales> you know the wash sale rule, if you sell a long position and then buy it back within 30 days, the IRS treats it like if never occurred, and you don't get to take the tax loss (assuming there is a loss). Incorrect. See Message 8984265 for an explanation. In summary, their purpose is to prevent claiming intermediate capital losses for positions that you intend to keep from one reporting year to the next. The IRS doesn't want you to report the loss until you really are intent on closing it out. They define this period of definition as 30 days before and 30 days after the trade. But if I trade IBM 1500 times in and out during the year (it's a hypothetical example, work with me) and close it out for 30 days sometime before Jan 31st of '00, I don't even bother reporting the wash sales for '99. There is no material effect on the capital loss that you report on your taxes in '99. And wash sales only apply to capital losses. -Sword

To: Peter V who wrote (35402)	5/8/1999 11:31:00 PM
From: Barronio	Respond to of 122087

The wash sale rule only covers losses, the moment you close a position at a gain (using your basis adjusted for any previous wash sales losses) then you owe tax, even if you buy the stock back 10 minutes later. Also, short sales are always result in short-term capital gains or losses, you can't get long-term status from a short no matter how long you hold it.