Quote:
Originally Posted by Mr_Tomahawk
Well shit.
What is a wash sale? I have TD.
|
It happens if you violate the IRS tax loss harvesting rules. If you sell a stock at a loss you can claim it on your taxes. You can't have bought the same stock for 30 days prior or after for the loss to count. If you do the loss is "washed" and stuffed back into your basis.
The intention in giving the tax break is that you really moved on and ate the loss. Though thirty days isn't all that long. Obviously everybody would sell anything down and buy it right back if the rule didn't exist