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Level 1
posted May 9, 2025 6:40:18 AM

Active trading

How is active trading of an ETF handled for tax purposes as far as wash sale rule is concerned? Say I trade the QQQ ETF several times per month thereby triggering wash sale rules. Will I incur short term capital gains on just the difference between gains and losses or will the losses not be allowed to offset the gains? Will TurboTax import all the transactions from Charles Schwab while accounting for this?

Thanks

Rich

0 1 6025
1 Replies
Level 12
May 9, 2025 6:57:08 AM

See https://www.irs.gov/taxtopics/tc429

 

In short, you would either need to be a dealer in securities or a trader with a mark-to-market (MTM) election in order to avoid the wash sale rule.