Question

Wash triggered when I sell in my account and purchase win minor account?

Forum|Forum|6 years ago
March 23, 2020
1 reply
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Will I trigger a wash sale if I sell stock YYY in my account for a loss and then purchase the the same stock YYY in a minor’s account within 30 days. Actually my child is 19 and a full time student but we support them.

Seems like I should be able to do this without triggering a wash since my losses cannot apply against any gains in the minor account as far as I know.

Thanks!

KathrynG3

Probably not. This is a gray area and it is ultimately your decision.

While it is not expressly stated that minors could not purchase stock within 30 days following a loss from the sale of the same stock, consider this guidance from IRS Publication 550: Investment Income and Expenses on page 57, middle column:

If you sell stock and your spouse or a corporation you control buys substantially identical stock, you also have a wash sale.

Especially if you are claiming your dependent on your tax return and the dependent has more than $2,200 of unearned income to report, requiring filing Form 8615 for the minor's unearned income, it would imply that identifying the transaction as a wash sale would be appropriate.