Posted On: 10/24/2016 3:38:19 PM
Post# of 75384
nobody answered this quite correctly
i'll put down 2 scenarios using ficticious numbers.
sceneario 1:
1. buy 10,000 shares on 10-1-16 of XYZ at 3.00 a share. your cost basis is 30,000.
2. XYZ goes down to 2.00 and you sell it for a 10,000 loss on 10-20-16.
3. you then buy back 10,000 shares at 3.02 on 10-26-16. at a cost of $30,200.
the first sale on 10-1-16 is a wash because you rebought before the 30 day period. you also will fold this loss into the cost basis of the next trade so instead of reporting the 2'cd trades cost basis as $30,200, you get to report it as $40,200 which was made on 10-26-16.
scenario2:
1. buy 10,000 shares on 10-1-16 of XYZ at 3.00 a share. your cost basis is 30,000.
2. XYZ goes down to 2.00 and you sell it for a 10,000 loss on 10-20-16.
3. you then buy back 10,000 shares at 3.02 on 11-3-16. at a cost of $30,200.
the first sale on 10-1 is not a wash because you waited 30 days to repurchase... and so you may report this loss.
the cost basis if the 2'cd trade is 30,200 with no adjustments.
hope that clears things up.
there is a way to get around wash sales rule but you have to change your accounting method to what is known as mark-to-market.
i will PM this to you because this post will probably be deleted.
i'll put down 2 scenarios using ficticious numbers.
sceneario 1:
1. buy 10,000 shares on 10-1-16 of XYZ at 3.00 a share. your cost basis is 30,000.
2. XYZ goes down to 2.00 and you sell it for a 10,000 loss on 10-20-16.
3. you then buy back 10,000 shares at 3.02 on 10-26-16. at a cost of $30,200.
the first sale on 10-1-16 is a wash because you rebought before the 30 day period. you also will fold this loss into the cost basis of the next trade so instead of reporting the 2'cd trades cost basis as $30,200, you get to report it as $40,200 which was made on 10-26-16.
scenario2:
1. buy 10,000 shares on 10-1-16 of XYZ at 3.00 a share. your cost basis is 30,000.
2. XYZ goes down to 2.00 and you sell it for a 10,000 loss on 10-20-16.
3. you then buy back 10,000 shares at 3.02 on 11-3-16. at a cost of $30,200.
the first sale on 10-1 is not a wash because you waited 30 days to repurchase... and so you may report this loss.
the cost basis if the 2'cd trade is 30,200 with no adjustments.
hope that clears things up.
there is a way to get around wash sales rule but you have to change your accounting method to what is known as mark-to-market.
i will PM this to you because this post will probably be deleted.
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