Wash sale rules in different accounts

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sp226
Posts: 126
Joined: Sat May 16, 2015 8:33 am

Wash sale rules in different accounts

Post by sp226 »

How does wash sale work when a fund is sold in one taxable account, and a similar fund is purchased in a different taxable account?
GTBuzz
Posts: 206
Joined: Wed Apr 01, 2015 2:06 pm

Re: Wash sale rules in different accounts

Post by GTBuzz »

Your 1099's won't show it as a wash sale, but it is still your obligation to report it as one when doing your taxes.
livesoft
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Joined: Thu Mar 01, 2007 7:00 pm

Re: Wash sale rules in different accounts

Post by livesoft »

It works exactly the same way as if there was only one single account and the transactions had occurred in the same account.

So, for what the OP wrote: Not a wash sale if the fund purchased was merely similar to the fund that was sold for a loss. The two investments have to be "substantially identical." They could be substantially similar and as long as they were not substantially identical, then there would be no wash sale.
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Nate79
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Location: Delaware

Re: Wash sale rules in different accounts

Post by Nate79 »

Which accounts count and which don't is certainly a debated topic around here. IRA's are definately included. Popular opinion is that 401k and HSAs are not included but you have to make your own decision because authoritative guidance is lacking.
rkhusky
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Joined: Thu Aug 18, 2011 8:09 pm

Re: Wash sale rules in different accounts

Post by rkhusky »

Wash sales caused by purchases in taxable accounts are different than when caused by purchases in tax-advantaged accounts. In the latter case, the loss is permanently disallowed, while in the former, the loss is only temporarily disallowed.

Wash sales are reported on IRS Form 8949.

The wash sale statute does not differentiate different types of accounts. The IRS has specifically mentioned wash sales caused by purchases in your own accounts, your spouse's accounts, your trust accounts, and your corporate accounts. The IRS has yet to exempt any type of account over which the taxpayer has control.
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