No. This is considered a "wash sale." This means that if you sell and then buy back the same stock/bonds/options within 30-days, then your economic position has remained unchanged. Basically, the IRS says you are doing this just to claim the loss on your income taxes. If you sold 20 shares and then repurchased 20 shares, this is a total wash. If you sold 20 shares and only bought back 10, then you can claim the loss on the 10 shares you DIDN'T buy back. Example:
You buy 400 shares of XYZ Co stock in 2001 for a total of $20K. In 2006, you sell all 400 shares of $12K and then buy them back within 30 days also at $12K. You are showing a "disallowed loss" of $8K. You can't claim this loss now. You have to wait until you sell them in a non-wash sale. The loss then is calculated by adding this $8K loss + $12K purchase price. This gives you a $20K basis in the stock, same as you had in the beginning. Then if you sold them for $15K, you could claim the $5K loss.
2006-12-02 07:53:53
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answer #1
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answered by beancounter 2
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"beancounter" is correct. The loss on the sale would be disallowed under the wash sale rules.
You can buy it back after 31 days and still claim the loss but not before.
2006-12-02 09:09:52
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answer #2
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answered by Wayne Z 7
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No. You need to wait 31 days to buy it back if you want to claim the loss. Plus you can't buy anything substantially similar either within 31 days.
2006-12-03 13:58:28
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answer #3
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answered by Stu 3
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Absolutely! A sale is final even if you buy it back. There is a tax on income gained. It stands to reason.....they is no tax on income lost.
2006-12-02 07:18:11
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answer #4
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answered by Marvin P 1
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