Originally Posted by
Michael Drew
Can someone explain to me how to avoid round trip rules? I sold some stocks Feb 23rd that were down over 50%. I originally bought them with some faith in the company and they would grow - but they tanked. Figured I might as well sell them and take the tax loss, then reacquire after 30 days and hold them. But now I'm wondering if I can actually do as I had planned and sill claim the losses on my 2022 taxes? If I buy the same stocks again, say tomorrow, would those buys be considering "round trips", and ineligible for taxes losses?
It sounds like what you are asking about is called a "wash sale."
The wash-sale rule is an Internal Revenue Service (IRS) regulation that prevents a taxpayer from taking a tax deduction for a security sold in a wash sale. The rule defines a wash sale as one that occurs when an individual sells or trades a security at a loss and, within 30 days before or after this sale, buys a "substantially identical" stock or security, or acquires a contract or option to do so.
You should talk to an accountant or your tax preparer before doing this.
Besides February 23rd to March 24th is not 30 days.
jtk
"A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty."
- Sir Winston Churchill (1874-1965)