Is "Wash Sale" rule applicable to Traditional IRA account?

Forum|Forum|4 years ago
February 20, 2022
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In a typical investment account, if I sell a stock at a loss and buy the same stock back within 30 days, the "Wash Sale" rule is triggered and the loss is not tax deductible.

Is "Wash Sale" rule applicable to Traditional IRA account? I would assume no since the gain / loss is not taxable in a Traditional IRA account anyway. Could someone confirm? Thanks.

Best answer by JohnB5677

You are correct. The Wash sale rule can only apply if the stock basis is a factor. In a traditional IRA account, it is not. The value of the account is a pure dollar value and there is no capital gain adjustment.

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Mike9241

However, it you sell a stock at a loss in a taxable account and purchase a substantially identical security in a tax-deferred account like an IRA then the wash sale rules will apply. a similar rule would apply if you sold a stock at a loss and within the wash sale period your spouse bought a substantially identical security in either her taxable or non-taxable account. these require manual adjustments because the broke won't do it.