Does a wash sale apply if you offset the loss with a profit within the wash sale period.

Forum|Forum|6 years ago
June 6, 2019
2 replies
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If you make a wash sale and then a profit within the wash sale period, does the wash still apply?

Scenario: You buy 10 shares XYZ at $10/share on day 1 for $100. On day 5, you sell all for $5/share ($50 loss). On Day 10, you rebuy 10 shares of XYZ at $6/share (the loss is now a wash sale). On Day 20, you sell all for $20/share ($200 cash).

Clearly if the second sale took place on Day 32 or after, the cost basis for the sale would be $110 ($60 + the $50 loss). Is this still true for the sale as stated (on Day 20, which is well within the wash sale period)?

Best answer by fanfare

Your basis on Day 10 lot is $11.00 per share. It doesn't matter when you sell if you sell at a profit.

Your loss on the Day 1 purchase is disallowed (Wash Sale).

fanfareAnswer

Employee

Your basis on Day 10 lot is $11.00 per share. It doesn't matter when you sell if you sell at a profit.

Your loss on the Day 1 purchase is disallowed (Wash Sale).

fanfare

Employee

Oops. Typo! your basis on the Day 10 lot is $11.00 not $1.00.

T

taxesarestilltheft

And so why do I have a wash sale on my record when I have never sold a stock for a loss?

Critter-3

@taxesarestilltheft

Since this is your only post on this forum and there is not enough info posted to give an answer. I highly recommend you talk to the broker on your account if you don't understand what is on the 1099-B form they issued.