buying a “substantially identical” security or an option to do so. Buying and selling the same stock would be a clear violation of the wash sale rule, whereas buying and selling different actively managed mutual funds within the same category is.
The wash sale rule comes into play only when you suffer a loss on the sale of shares of stock (including shares of a mutual fund) or securities and purchase, or buy an option to purchase, ''substantially identical'' stock or securities. If you do so within.
There might be transaction costs if he invested through a broker, and the fund might have a redemption fee for short-term holders. Plus, there’s the value of Profits’ time. Also, under the wash sale rules ... two mutual funds have identical returns.
Of course, many clients may wish to sell an asset to realize losses, then turn around and repurchase the same fund ... the wash sale rule. A wash sale occurs when an investor sells an asset at a loss and, within 30 days, acquires "substantially identical.
Those who wish to maintain their market exposure and asset allocations after the sale, and still benefit from the tax losses, must comply with the “wash sale” rule ... for two mutual funds to be determined to be “substantially identical” Note.
THE remaining days of 1994 can be rewarding for mutual ... GNMA Fund (-3.2 percent) for USAA GNMA Fund. The wash-sales rule, which prevents investors from deducting losses when they reinvest the proceeds of a securities sale in substantially identical.
When recognizing tax losses, you do have to be careful that you do not trigger a wash sale ... a reorganization. The rules also apply to short sales. According to IRS Publication 564, mutual funds are not viewed as substantially identical to funds issued.
You can avoid this problem by complying with the "wash-sale" rule, which permits you to sell a stock or mutual fund and buy a replacement stock or fund, as long as the replacement is not considered "substantially identical" in nature. 2. Invest in.
We wrote about whether or not substitute investment funds are "substantially identical" in two prior articles (August ... be satisfied that there is no way around the Wash Sale Rule with alternate accounts. Perhaps someone with a mega-loss and mega-wealth.
If you want to get out of poor-performing stocks or mutual funds ... The wash sale rule could trip you up. A wash sale is when you sell a security at a loss, and--within 30 calendar days before or after that sale--you buy a substantially identical security.