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  • Deferring capital loss from 2021 to 2022?

    From MZB@21:1/5 to All on Thu Jan 6 10:18:27 2022
    OK, let's say in late December, 2021, you buy 1000 sh. of XYZ at 10 and
    sell it at 9, so you lose $1000. Furthermore, suppose you do this 5
    times, so you have $5000 in losses for 2021 all accrued in late December.

    Now suppose for some reason you don't want to claim this loss in 2021.

    So, if you buy/sell XYZ in early January, 2022, will the wash sale move
    that loss into 2022?

    Mel

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  • From Stuart O. Bronstein@21:1/5 to MZB on Thu Jan 6 12:15:23 2022
    MZB <[email protected]> wrote:

    OK, let's say in late December, 2021, you buy 1000 sh. of XYZ at
    10 and sell it at 9, so you lose $1000. Furthermore, suppose you
    do this 5 times, so you have $5000 in losses for 2021 all accrued
    in late December.

    Now suppose for some reason you don't want to claim this loss in
    2021.

    So, if you buy/sell XYZ in early January, 2022, will the wash sale
    move that loss into 2022?

    The whole purpose of the wash sale rule is to disallow a loss (it
    doesn't apply to gains) from the sale and acquisition of the same
    stock within 30 days. So no, you can't move the loss to 2022. In
    fact the wash sale rule would prevent you from recognizing the loss
    at all within that time period. You may be able to recognize the
    loss in 2022 if you wait more than 30 days.

    But you're actually talking about something else - shifting income or
    a loss to another year. People have tried that in many forms - they
    call them stradles. Some have been successful, but for the most
    part, as I recall, they are not allowed.


    --
    Stu
    http://DownToEarthLawyer.com

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
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  • From ira smilovitz@21:1/5 to MZB on Thu Jan 6 12:40:42 2022
    On Thursday, January 6, 2022 at 10:18:44 AM UTC-5, MZB wrote:
    OK, let's say in late December, 2021, you buy 1000 sh. of XYZ at 10 and
    sell it at 9, so you lose $1000. Furthermore, suppose you do this 5
    times, so you have $5000 in losses for 2021 all accrued in late December.

    Now suppose for some reason you don't want to claim this loss in 2021.

    So, if you buy/sell XYZ in early January, 2022, will the wash sale move
    that loss into 2022?

    Mel

    --

    Yes, you can push a loss forward by triggering a wash sale and not selling the replacement shares until the new year. What you can't do is push a gain forward. Once you have a realized gain, it must be recognized (that is, included on the current tax
    return.)

    Ira Smilovitz, EA
    Leonia, NJ

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

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  • From Stuart O. Bronstein@21:1/5 to ira smilovitz on Thu Jan 6 13:51:28 2022
    ira smilovitz <[email protected]> wrote:
    UTC-5, MZB wrote:

    OK, let's say in late December, 2021, you buy 1000 sh. of XYZ at
    10 and sell it at 9, so you lose $1000. Furthermore, suppose you
    do this 5 times, so you have $5000 in losses for 2021 all accrued
    in late December.

    Now suppose for some reason you don't want to claim this loss in
    2021.

    So, if you buy/sell XYZ in early January, 2022, will the wash
    sale move that loss into 2022?

    Yes, you can push a loss forward by triggering a wash sale and not
    selling the replacement shares until the new year. What you can't
    do is push a gain forward. Once you have a realized gain, it must
    be recognized (that is, included on the current tax return.)

    I defer to Ira. Thanks.


    --
    Stu
    http://DownToEarthLawyer.com

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

    --- SoupGate-Win32 v1.05
    * Origin: fsxNet Usenet Gateway (21:1/5)
  • From MZB@21:1/5 to ira smilovitz on Thu Jan 6 13:51:51 2022
    On 1/6/2022 12:40 PM, ira smilovitz wrote:
    On Thursday, January 6, 2022 at 10:18:44 AM UTC-5, MZB wrote:
    OK, let's say in late December, 2021, you buy 1000 sh. of XYZ at 10 and
    sell it at 9, so you lose $1000. Furthermore, suppose you do this 5
    times, so you have $5000 in losses for 2021 all accrued in late December.

    Now suppose for some reason you don't want to claim this loss in 2021.

    So, if you buy/sell XYZ in early January, 2022, will the wash sale move
    that loss into 2022?

    Mel

    --

    Yes, you can push a loss forward by triggering a wash sale and not selling the replacement shares until the new year. What you can't do is push a gain forward. Once you have a realized gain, it must be recognized (that is, included on the current tax
    return.)

    Ira Smilovitz, EA
    Leonia, NJ


    Well, I did try it and I think it worked. I bought XYZ say at 10. But my
    cost shown on Ameritrade is higher, enough to push the loss taken away
    last year into this year.

    Mel

    --
    << ------------------------------------------------------- >>
    << The foregoing was not intended or written to be used, >>
    << nor can it used, for the purpose of avoiding penalties >>
    << that may be imposed upon the taxpayer. >>
    << >>
    << The Charter and the Guidelines for submitting posts >>
    << to this newsgroup as well as our anti-spamming policy >>
    << are at www.asktax.org. >>
    << Copyright (2011) - All rights reserved. >>
    << ------------------------------------------------------- >>

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    * Origin: fsxNet Usenet Gateway (21:1/5)