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Stock Sales with Wash Loss

Summit1
Level 4

1120S client has brokerage account in the name of the S Corp. 

Client purchased 300 shares of A Company on 7/7/21. 

Company purchased 300 share of A company on 12/29/22 (sale did not close until 12/30/22)

Company sold 300 shares of A Company on 12/30/22. When completing this transaction client elected FIFO for the sale. 

The 1099 shows the loss as a wash sale. 

I believe the regulation states that you need to wait 30 days after the date of sale to purchase same or similar investment. Is there an exception if you purchased the replacement stock the day before? Is the problem the fact that brokerage company recorded the purchase on 12/30 instead of 12/29?

 

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Accepted Solutions
BobKamman
Level 15

A wash sale occurs when you sell or trade securities at a loss and within 30 days before or after the sale you:

Buy substantially identical securities,

Acquire substantially identical securities in a fully taxable trade, or.

Acquire a contract or option to buy substantially identical securities.

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2 Comments 2
BobKamman
Level 15

A wash sale occurs when you sell or trade securities at a loss and within 30 days before or after the sale you:

Buy substantially identical securities,

Acquire substantially identical securities in a fully taxable trade, or.

Acquire a contract or option to buy substantially identical securities.

Summit1
Level 4

Thank you!