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Level 1
posted Apr 1, 2021 11:43:50 AM

wash sales

I purchased and sold 3 stocks within a 30 day period. The first was a gain and the other 2 were losses. If I understand correctly, the1st loss is disallowed and added to the basis of the 2nd loss. I believe the 2nd loss is also disallowed, but what happens to the 2nd loss amount? There were no other purchases of that stock.

0 2 310
2 Replies
Level 15
May 20, 2021 7:16:00 PM

3 different stocks. or 3 purchase sales of the same stock

 

3 substantially different stocks - wash sale rules wouldn't apply

 

3 purchase sales of same stock

1st sale purchase not a wash sale

sale of 2nd purchase is a wash sale due to 3rd purchase. the disallowed loss is added by the broker to the tax basis of 3rd purchase.

sale of 3rd purchase there is no was sale because there was no replacement shares purchase - 2nd purchase has no effect in this situation. 

Level 15
May 20, 2021 7:26:52 PM

if you still hold that third purchase, it's basis is adjusted and you will get credit for tax purposes on the loss when you do sell it, if ever.