Vanguard & 2012 1099-B

thanks Tom , excellent examples - and thanks to everyone else for their time, patience, and input -

I've come up with another example and explanation just to see if I'm understanding things correctly - please give me your feedback :

At t=0 I buy 100 shares of mutual fund A for $5,000 ( $50/share) At t` days I buy 100 shares of A for $1000 ( $10/share) At tp days I sell all 200 shares of A for $5000 ($25/share)

Total Loss = $1000 ,(i.e. $6000 - $5000)

Now , looking at it another way and incorporating the wash sale rules :

the first 100 shares are bought at $5000 & sold at $2500 for a $2500 disallowed loss due to the wash sale invoked by the 2nd 100 shares bought.

however, the cost basis of the 2nd 100 shares bought at $1000 increases to $3500 and then these shares are sold for $2500 as part of the fund closeout.

and we get the same $1000 Loss ( i.e. $3500 - $2500) as shown above & this can now be entered on Schedule D.

Reply to
Don
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To quote Henry Higgens -- By George, I think you've got it!

Just don't buy any new shares before t0.

Reply to
Barry Margolin

This will be my last post on this thread.

Using FIFO - You have no wash sale Using LIFO - At the end of day 70, once all 200 shares are sold, you have no wash sale. I will repeat, for the last time, if you have no shares on 12/31, you have no wash sale. If during the year, you actually had an actual wash sale, and not a convoluted attempt at one, but by year end have no shares, the wash sale that actually occurred is still of no consequence, as, let me see, you have no shares by 12/31.

Reply to
JoeTaxpayer

Thanks Barry , great forum !!!!!

Reply to
Don

Unless there is a loss sale in December, and a new buy early enough in January (to be within 30 days). But if you're out of the stock for the full calendar month of December, there is (effectively) no wash sale.

Seth

Reply to
Seth

Correct! The 30 day rule spills into the next year and my using 12/31 as a magic cutoff was ignorant to say the least.

Reply to
JoeTaxpayer

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