• LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

Wash sale rule: year-end tax strategy

by on
in Small Business Tax

Naturally, you might sell off stock losers now to offset capital gains realized earlier in the year. But if you think a stock will rebound, you might want to reacquire it shortly after selling it.

Strategy:
Watch out for the “wash sale” rule. This rule says you can’t deduct the loss from a sale of securities if you buy “substantially identical” securities within 30 days of the loss sale. Instead, the loss is added to your basis in the new stock.

You can avoid the wash sale rule by waiting at least 31 days before you buy back the same stock. Keep an eye on the calendar to secure a loss for 2009.

Alternatively, you might use the “double up” strategy: Keep the stock and buy more shares of the same stock now. Then wait at least 31 days to sell the original block of shares. By using this technique, you acquire the new shares at a low price and preserve a tax loss for the old shares.

Like what you've read? ...Republish it and share great business tips!

Attention: Readers, Publishers, Editors, Bloggers, Media, Webmasters and more...

We believe great content should be read and passed around. After all, knowledge IS power. And good business can become great with the right information at their fingertips. If you'd like to share any of the insightful articles on BusinessManagementDaily.com, you may republish or syndicate it without charge.

The only thing we ask is that you keep the article exactly as it was written and formatted. You also need to include an attribution statement and link to the article.

" This information is proudly provided by Business Management Daily.com: http://www.businessmanagementdaily.com/27381/wash-sale-rule-year-end-tax-strategy "

Related Articles...

    No matches

Leave a Comment